Could king salmon become "as big as dairy" for New Zealand? Pattrick Smellie investigates.
Norwegian aquaculture technology provider AKVA is developing fully submersible farms.
We are tearing across a fjord near Stavanger on Norway's North Sea coast in a high-speed launch and New Zealand King Salmon managing director Grant Rosewarne is frustrated.
He had specifically asked that we be taken to see an invisible salmon farm, but we've run out of time.
Planes are waiting to take a large group of New Zealanders — from the fishing industry, iwi, leading environmental groups and one hanger-on journalist back to New Zealand after a whirlwind introduction to the vast and fast-growing Norwegian salmon-farming industry.
Dotted throughout the cold, tide-swept fjords of Norway is an industry that country's government is investing in heavily, punting that fish — both wild-caught and farmed — will be one of the main industries to take up the slack as the rich bounty of North Sea oil and gas declines.
Norway breeds the Atlantic salmon species, whereas New Zealand's comparatively tiny salmon-farming industry farms Pacific King salmon — a breed acknowledged to produce a richer, more delicious fish.
The New Zealand salmon have no need for antibiotics in their rearing and, unlike their Nordic cousin, are not molested by sea-lice, a major issue for Norwegian aquaculture.
The effort is worthwhile for Norway. At current oil prices, three Atlantic salmon are worth roughly the same as a barrel of oil.
NZ King Salmon's Rosewarne is extracting even more value from king salmon, grown at nine sites in the Marlborough Sounds.
A biochemist by training and fast-moving consumer goods branding maestro by reputation — he was behind the transformation of the unremarkable Moccona instant coffee brand into a drink that "heft mehr MMM" — Rosewarne and his Nelson-based team have done what some said was impossible: convinced high-end restaurants from Auckland to Shanghai to New York to place his salmon on their menus under a brand name: Ora King Salmon.
"It's both a breed and a brand," he says over breakfast one morning in Stavanger, where fish-farmers from around the globe gathered last month to track the latest trends in aquaculture.
So-called "wild" fisheries are under such pressure worldwide from over-fishing that almost half of all seafood eaten by humans every year is farmed, and that proportion will continue to rise.
In New Zealand, aquaculture is still some distance from that balance.
The Ministry of Primary Industries' latest Situation and Outlook for Primary Industries report, published last month, showed total aquaculture production is around 120,000 tonnes, compared with around 450,000 tonnes from wild fisheries.
However, farmed seafood commands a forecast average price of $10.25 per kilogram, almost twice the $5.50 per kg expected from seafood taken by traditional methods.
Three main species make up the aquaculture export total. Green-lipped mussels account for 71 per cent, salmon are 23 per cent, and Pacific oysters bring in 6 per cent of the total.
At a projected $1.8 billion this year, total seafood exports are still a distant fifth by value, trailing dairy at $16.6b, meat and wool at $9.4b, forestry at $6.4b, and horticulture at $5.5b, according to the MPI forecasts.
But it needn't be that way, says Rosewarne, who believes king salmon could be "as big as dairy" for New Zealand in 30 years' time, taking up a tiny area of "surface hectares" compared with the thousands of hectares required for land-based farming, and producing protein whose value per kg blows land-based farming out of the water.
Of the 17 surface hectares his company farms in the Marlborough Sounds, Rosewarne says "four of it is outstanding, four is reasonable, and nine is terrible".
"So the whole company, all 500 people, all those jobs rely on four surface hectares, which is crazy," he explains. "And we can earn somewhere between $20m and $30m per surface hectare, depending how good the position is.
"Nothing can come close to that on land. Dairy is like $1200 a hectare. Kiwifruit is the most valuable, but it's only in the thousands per hectare, sheep and beef in the hundreds."
Of course, that is partly because fish-farming occurs in three dimensions. A surface hectare discounts the depth of the structure the fish are kept in. That said, the argument that aquaculture has a small physical and environmental footprint compared to land-based farming still holds.
However, to achieve even a fraction of his ambition, Rosewarne needs somewhere to grow the fish.
NZ King Salmon's Marlborough Sounds farms stir high emotion and its attempts to gain resource consents for new sites produced a landmark Supreme Court decision in 2014 that found "outstanding natural landscapes" were a reason to turn down six of nine proposed new sites.
In its report on the company's application to move several of its farms to sites that would give better production and environmental outcomes, a highly experienced board of inquiry "agreed that none of us have ever experienced the level of vitriol that was palpable in the hearing room" for these proposals.
"Intemperate language", allegations of corruption, false claims of unprofitability, objections to NZKS being part-owned by foreign investors and highly exaggerated claims about environmental impacts were the norm.
"We find it difficult to understand how excessive claims of disastrous effects from this proposal can be made by those criticising it, when they have either not read, or do not give any weight at all to" expert and conservative evidence, its report said. "These excessive assertions … cease to have any real significance."
Yet, to Rosewarne's intense frustration, the board gave weight to such submissions, based on the depth of emotion from submitters.
"Despite public surveys that tend to show otherwise, there is a substantial body of deep-seated resentment in the public arena," it said. "The salmon farming industry is almost certainly going to find its pathway into the future frustrated by continued deeply felt opposition."
Further development in the Sounds would be "hotly contested".
The board recommended investigating whether "alternatives might exist whereby this industry can continue and potentially expand in a sustainable way at locations where such division in the community can be avoided".
Says Rosewarne: "They admit they're captive to a minority, noisy group, then they conclude 'yes, they should get what they want'."
Which brings us back to that scoot across a Norwegian fjord to inspect an allegedly invisible salmon farm.
Norway produces most of the 2.4 million tonnes of salmon sold annually around the world. By comparison, NZKS produces just 8000 tonnes of king salmon, of which only 20,000 tonnes is grown worldwide, despite its higher value than Atlantic salmon.
By 2050, Norway intends to be farming 5 million tonnes a year of salmon and the global market will have grown to around 10 million tonnes, says Rosewarne. Of that, 10 per cent will be at the top end of the market, where NZKS plays.
As the manager of a premium brand that can't meet demand on current production, Rosewarne sees an "unrealised, massive premium segment of unknown size", with New Zealand well-placed because of almost exclusive specialisation in the most valuable salmon species.
In Norway "they don't see salmon farming as being mutually exclusive with a high tourism area or beautiful landscapes or environment".
On the other hand, the policy director for the Environmental Defence Society, Raewyn Peart points out that Norway has thousands of kilometres of coastline suited to salmon farming. There are few such areas in New Zealand.
One is the Marlborough Sounds, and that is "full", she says, with pressure on NZKS to move out altogether.
Rosewarne agrees. "Inshore, we certainly don't have any plans to obtain more space."
There are possible sites on Stewart Island, but local government studies have found against them and Peart reckons both landscape issues and the presence of rare, breeding sea-lions would stymie development.
Parts of Fiordland might work, and the Southland Regional Development Agency wants to explore that option. However, Peart says a salmon farm in a national park is a non-starter. Again, Rosewarne agrees, saying: "Fiordland is not a possibility".
And even in Norway, there is growing opposition to expanding coastal salmon farms.
As a result, the industry is developing new fish-farm technologies that would take farms both underwater and out to sea.
This is where Rosewarne is pinning his hopes for expanded king salmon farming in New Zealand, with big plans for the often-wild waters of Cook Strait.
Presentations by Norwegian aquaculture technology provider AKVA suggest that farms capable of riding out storms by being fully submerged, and with feeding occurring by submerged pipes from a nearby barge could revolutionise both the economics and acceptability of salmon farming in New Zealand.
AKVA says the technology is only six months from deployment, although NZKS would not want to be a guinea pig and would first put an empty sea-pen in the Strait to test it.
Realistically, offshore salmon farming is at least four to five years away, Rosewarne says.
Offshore pens for 10,000 tonnes of production might cost $30 million at most, and by 2050 as much as 100,000 tonnes of salmon could be produced in Cook Strait.
That kind of build-up is "within the capacity of the existing balance sheet and the return from the fish can handle that sort of cost because it's not an order magnitude different from what we're doing".
EDS's Peart is positive about the potential for offshore, submerged technology.
"If you want to expand the industry, and it is certainly in global terms pretty small in New Zealand, we need to be looking at going offshore.
"There would need to be careful investigation of appropriate sites that are not going to interfere with our wildlife, but I could see a lot of benefits. It clearly deals with the issues of water flow, dispersion and benthic (seabed) impacts if you're in essentially deep, fast-flowing areas."
If invisible from shore, there would be "far less landscape conflicts," Peart says.
Rosewarne is not counting any chickens, or perhaps more accurately smolt, before they hatch.
The current Government has yet to express more than generic support to the sector and Fisheries Minister Stuart Nash is months off a decision on re-siting farms in the Marlborough Sounds.
However, with a growing list of sunset industries — Rosewarne cites the end of offshore oil and gas exploration, Greens leader James Shaw's suggestion that red meat consumption needs to decline, and a desire to move away from low-value tourism — "there has to be a sunrise to offset some of these sunsets".
"You're not going to find a primary industry that has the capacity to become as large as the dairy industry with such a benign effect on the environment and adding so many jobs."
His greatest fear remains the potential for opponents to oppose offshore farming through the RMA, which applies out to the 12 mile nautical limit.
"The RMA is an amazing tool for stopping things," he says. "I wouldn't like to think that people would use it to take up issues because they are simply opposed to salmon farming."
● Pattrick Smellie travelled to Norway as a guest of New Zealand King Salmon.