Demand spurs paua expansion

By LIBBY MIDDLEBROOK

A small New Plymouth abalone farm is planning a $700,000 plant expansion to satisfy increasing demand for the shellfish from Asia, the United States and within New Zealand.

Rainbow Abalone Pearl Farm wants to triple the size of its 500-water tank operation this year after failing to meet domestic and export orders for baby paua, abalone pearls and meat for about six months.

Demand for the pearl, which takes up to six years to grow, is also on the rise in the United States, with Rainbow expecting to export more than 6000 blue and green pearls by January.

"Demand for seed and meat has been far in excess of what was produced in New Zealand this year," said Rainbow's general manager, Rodney Ewin.

He set up the land-based operation near the New Plymouth port about seven years ago, after running another paua farm.

"Five years ago we were all hobby farmers and it was a pretty difficult business to be in. All of a sudden our situation's reversed. We've got a couple of large farms looking to sign reasonably long-term contacts to buy paua seed."

Rainbow, which is searching for an outside investor through a Wellington-based merchant bank, wants to boost the size of its hatchery and meat-growing plant to equal the size of its pearl operation, which makes up most of the business.

Thereare no instant profits to be made in abalone pearl production because of lengthy growth cycles.

Rainbow's colourful individual half-round pearls eventually retailat between $30 and $900 depending on quality and size.

Baby paua have shorter growth cycles and

Mr Ewing said the company had not been able to fill orders for meat and paua seed because customers wanted regular weekly supplies rather than large, infrequent deliveries. prompting the expansion plansnteThe firm's 180,000 annual adult paua operation, which attracts returns of about $130 a kilogram in New Zealand, is expected to grow to 840,000 adult paua each year.

"The biggest limitation right now is many of the [order] inquiries require regular supplies," said Mr Ewing. "They want an air freight container every Monday.

"At this stage we're unable to supply that sort of volume. We need more scale.

"We want to spread our risk across the three aspects of our business, too, rather than just concentrating on pearls."

Mr Ewing holds a 25 per cent interest in the company. A small group of Taiwanese businessman own the remaining 75 per cent of shares.

Rainbow's annual turnover is expected to grow from $500,000 to $2.5 million over the next five years.