BC's Only Land Based Salmon Farm on Target

Vancouver Sun

B.C.’s only land-based salmon farm on target
By Randy Shore, Vancouver Sun February 16, 2015

VANCOUVER — North America’s only land-based Atlantic salmon farm is on track to meet its production cost targets next year, according to the CEO of Kuterra, the business set up to run the project.

As technical fixes are implemented and the facility ramps up to full production with each successive group of fish entering the facility, Garry Ullstrom projects a production cost in the neighbourhood of $7 per kilogram HOG (head on, gutted).

That leaves a tidy profit margin when wholesaler Albion Fisheries pays about $9 per kilogram for a product the firm markets as premium and sustainable.

The $9.5-million Kuterra facility near Port McNeill was built on Namgis First Nations land with a combination of philanthropic donations and government grants to make an economic case for a land-based salmon farming industry.

Now that the technical issues have been resolved, Ulstrom estimates it would cost about $6 million to replicate the facility. That’s still higher than the capital cost of a net-pen farm, but closed-containment aquaculture answers many of the pressing environmental issues that the ocean-based industry is wrestling with, including Atlantic salmon escapes, chemical controls for sea lice and the spectre of disease transfer to wild fish.

And proponents point out that when conditions in the tanks are carefully controlled, fish grow faster with less feed and draw a higher price in the market. Atlantic salmon in closed-containment systems grow to market weight in 12 to 15 months, compared with 21 to 24 months in ocean-based net pens.

While the first cohort of 20,000 fish experienced wildly fluctuating conditions as the facility’s filtration and heating systems were built around them, costs began to stabilize and drop with successive cohorts, Ullstrom said.

The electricity cost per kilogram of finished salmon is down almost 60 per cent since the first smolts entered the facility in March 2013.

“What we saw in the second cohort was much more stable growth and by the fourth cohort growth started to take off as water quality improved,” Ullstrom said. “It’s all about providing optimal conditions.”

Determining just what those conditions are will be expedited by the work of Colin Brauner, a professor of zoology at the University of British Columbia.

A three-year $600,000 grant from the Natural Sciences and Engineering Research Council of Canada will allow Brauner to determine the conditions of day length, temperature and salinity that promote the fastest growth, the best flavour and texture and the optimal feed conversion (how much feed is required to produce a kilogram of finished salmon).

“When you rear fish in the ocean, you get what you get in terms of weather and temperatures the fish experience,” said Brauner. “In closed containment you can control those things and tweak the system to get the best product and the best return (on input costs).”

Brauner’s lab can grow seven separate cohorts simultaneously under a variety of conditions and even change conditions, such as the salinity of the water, as the fish mature.

Salmon blood has only one-third the salinity of ocean water so the fish expend energy balancing electrolytes to maintain internal salinity during their time in the ocean and in fresh water, Brauner said. Salmon may grow better and faster under conditions of reduced salinity and then spend the last few weeks before harvest in water closer to ocean-like salinity to ensure the flavour is correct.

“We can work directly with Kuterra to resolve their most pressing questions,” said Brauner. “Science can be a slow process … each experiment lasts nearly a year, but we can test several different conditions at once.”

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