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"Aquaculture, not the Internet, represents the most promising investment opportunity of the 21st Century."

- Peter Drucker, Management Expert & Economist


A pivotal week in the development of land-based salmon farming

The drum beat has been getting louder over the past year: Land-based salmon farming, once dismissed as an economic non-starter, is now commercially viable, and this week marks a leap forward in taking the sector mainstream.

With experienced salmon farming industry analysts at major lenders including DnB and Pareto showing production costs in some cases well below conventional net-cage levels, producers now have the third-party justifications they were looking for to bring more investors into the fold, and two companies just announced their intentions to make their long-time visions a commercial reality.

First was AquaBounty, developer of AquAdvantage genetically modified salmon, which announced it has acquired its first US commercial production facility - a RAS system formerly owned by Bell Fish Company. By moving to a commercial phase, AquaBounty can now prove both the economics and the market acceptance for land-based farmed salmon using GM technology. It's got a perception hurdle to overcome, but with some signs pointing to more consumer acceptance for GM, the company's broodstock may play a critical role in making landbased salmon systems far more affordable, and thus far more prevalent.

Atlantic Saphire expansion

Elon Musk of land-based salmon farming, Johan Andreassen, announced that his company, Atlantic Sapphire, plans on raising more than $100 million to finance two phases of its land-based operations in Miami and Denmark. Not only that, but an IPO on the Oslo Stock Exchange is on the schedule.

Without capital, land-based systems can't thrive, and without patient and faithful investors, they can't be sustained. Investors in Atlantic Sapphire and AquaBounty have already put a lot of money into the projects - the fact that they're willing to put even more in shows their belief.

So, welcome to the future, and an entirely new dynamic in the farmed salmon industry.

Key sucess factors for landbased farming

Pareto Securities Senior Analyst Henning Lund, who was the keynote speaker at the IntraFish Seafood Investor Forum in NYC 2017, broke down the possible cost of each farming method, and the math showed land-based salmon farming is suddenly becoming a very real alternative.


Production Cost/kg €

Capex/kg €

Ocean grow-out



Land-based, full cycle



Land-based big smolts



Traditional (landbased smolt, Ocean grow-out)



He said the US fresh market is supplied by trucking salmon in from Canada and air freighted salmon from Chile and Europe. However, EU and Chilean producers add 0.89-1.30 € in air transportation costs to the United States and Asia.

One key to land-based farming is to have high density," he said, offering the comparison of an OPEX of about 11.60 € per kg at 10 kg biomass/m3 versus an OPEX of about 3.60 € per kg at 80 kg biomass/m3.

However, there are several difficulties to overcome with land-based farming, Lund said. "There is a steep learning curve here." He added the two main factors are management and operational experience. Another factor is smolt size, which today is about 100 grams, but he predicted that to double by 2020 and possibly reach about 500 grams long term. Moving from 100 to 500-gram smolt is about an 8 percent volume growth, or 5 kg in harvest weight. "There is a lot of investments and initiatives right now, especially in Norway, to increase that size," he said.

Inspirational sources: Intrafish, UnderCurrent & The Fish Site. Photo: Jesper Heldbo

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