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B.C. missing the boat on aquaculture opportunities

Fish farming industry willing to invest more than $1 billion in B.C., if governments wanted it
Damon Rampanen, Cermaq Canada assistant manager in Tofino, is one of the many First Nations people who work in B.C.’s fish farming sector | BC Salmon Farmers Association

Nearly half of all the seafood consumed in the world – 46% – is farmed, and it is expected to account for 59% by 2030, according to the recent United Nations Food and Agriculture Organization’s State of Fisheries and Aquaculture report.

There is huge potential in Canada – B.C. in particular – to become a significant player in a global industry that is valued at $344 billion, and growing.

But B.C. is missing the boat, thanks to provincial and federal government policies that have lately taken an antagonistic turn towards one segment of the aquaculture industry: open-net salmon farms.

Despite a growing demand, B.C.’s share of global farmed salmon production has been falling since 2002, not growing.

“Investment in aquaculture is at a stagnant point where we’re doing what we call care and maintenance because people are just saying no,” said John Paul Fraser, executive director of the BC Salmon Farmers Association. “There doesn’t appear to be a lot of security or certainty or stability.”

In an economic analysis commissioned by the association, economics consulting firm RAIS Inc. says B.C. salmon farming companies are poised to invest $113 million in B.C. in 2021, and $684 million by 2030, in things like new hatcheries and recirculating aquaculture systems. In total, the industry could invest $1.4 billion over the next 40 years.

“Investment through 2050 would create almost 10,000 new jobs, add cumulative $44 billion in new economic activity,” the report states.

But those investments may not happen, as long as a huge unwelcome mat that the Trudeau government laid on B.C.’s doorstep remains in place.

Both the Trudeau and John Horgan government have signalled intentions to see open-net salmon farming phased out in B.C. and replaced with land-based systems.

In the last federal election, Prime Minister Justin Trudeau pledged to phase out open-net salmon farms, but only in B.C.

After his re-election, Trudeau ordered his fisheries minister to develop a plan to phase those farms out by 2025.

Earlier this year, the federal government issued a report suggesting land-based aquaculture systems – recirculating aquaculture systems (RAS)  – are ready for prime time.

“Land-based RAS and hybrid systems are the two technologies ready for commercial development in B.C.” the federal government’s State of Salmon Aquaculture Technologies states.

In 2017, Premier John Horgan and his agriculture minister, Lana Popham made it clear that their government also thinks open-net fish farms should be phased out.

Acting on the Cohen Commission’s recommendations, which suggested moving open-net fish farms out of wild salmon migration pathways, the Horgan government established a timetable requiring fish farms operating in the Broughton Archipelago to vacate the area over the next few years. Re-establishing them elsewhere would require getting First Nations’ consent. Some of the leases and tenures expire two years from now.

“As of June 2020, the salmon farming industry in B.C. has not received any information on the tenure renewal process that is now only two years away,” the report states.

That kind of uncertainty doesn’t give investors much confidence, which explains why investments in B.C. fish farming industry are lagging behind other countries, like Chile and Norway.

“No one’s going to put in hundreds and hundreds of millions of dollars of additional investment, particularly in new technology and alternate practices, in the absence of knowing … that there’s going to be, decades down the road, an ocean in which to do business,” Fraser said.

Salmon farming in B.C. is vigorously opposed by some First Nations, particularly in the Broughton Archipelago. But both levels of government could also run into problems with First Nations that are involved in fish farming, because, as some First Nations leaders point out, reconciliation isn’t always just about the right to say “no” to an industry – it can also be about the right to say “yes.”

The Tlowitsis First Nation in Campbell River, for example, has an arrangement with Grieg Seafood (FRA:GR8) , in which it collects about $750,000 annually in rent payments on three salmon farm operations in its territory. It hopes to become an owner of a fourth.

“We’re going to own the site, and they’re going to rent the site off us,” said Tlowitsis Chief John Smith.

Several Port Hardy-area First Nations are also involved in fish farming.

“We do have a processing plant here in Port Hardy that processes Atlantic salmon, so that employs a lot of Indigenous and non-Indigenous people in our community,” said Port Hardy Mayor Dennis Dugas.

Meanwhile, land-based fish farming systems require huge amounts of capital, and their economic viability is questionable.

Some small land-based systems have been built in B.C., but have struggled to make a profit. According to the Raising Opportunity report, Golden Eagle Enterprises, which raised coho in Agassiz, has ceased its operations.

“After six years of production and market development, Golden Eagle Enterprises, a land-based coho facility in Agassiz, B.C., found that the market was unwilling to pay the premium price necessary to make its land-based production profitable,” the report states.

Even if land-based systems do become commercially viable, Dugas worries that they won’t be built in communities like Port Hardy.

“We’ve been told that we don’t have the land base here,” Dugas said. “It takes considerably more land to have a farm on land than in the water, and we just don’t have the land base to even support that in our community.”

Recent sanctioning decisions by major fish farming companies seem to bear out his concerns. Major investments are being made in large land-based systems, but they are being made in the U.S., which makes sense because that’s where the biggest market for Atlantic salmon is.

“Given their distance from major farmed salmon markets, B.C. land-based systems would face a significant competitive disadvantage,” the report states.

“Therefore, if salmon farming companies adopted closed containment systems, it is likely that they would have to relocate their operations nearer to their primary markets. With their departure, First Nations and coastal communities would lose a key contributor to their economic survival, and B.C. would lose a $1.6 billion industry.”

“There’s two things you need,” said RAIS president Doug Blair. “You need to be close to the market and you need to have access to huge amounts of fresh water. If governments truly are signalling that they want to move all net-pen salmon farming to land-based closed containment, it’s never going to happen in B.C.” 

The main opposition to open-net salmon farms is the concern that they transmit sea lice and viruses to wild salmon.

The industry has improved its management of sea lice outbreaks over the years, however, and at the end of September, Fisheries and Oceans Canada released findings of several scientific studies of nine pathogens, including the piscine orthoreovirus, and concluded that they pose “minimal risk” to wild salmon. 

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