Paua farmers tap rich demand

By LIAM DANN



Paua meat exports are about to get a boost with the expansion of an aquaculture operation at Silverdale, north of Auckland.

Silverdale Marine Hatchery, owned by Stuart McFarlane and Robyn Hope-Johnstone, which has been focused on paua pearl production until now, is to establish 10 new growing units that will eventually produce more than 100 tonnes of meat a year for export, mainly to Asia.

McFarlane was a pioneer of the aquaculture industry in New Zealand and was involved with the development of the mussel farming industry in the 1960s.

His partner, Hope-Johnstone, said the international demand for paua meat had promoted the move to increase production.

Instances of paua poaching in the past year had highlighted the huge demand for the meat.

Farming the meat provided a solution that would benefit the economy and the wild paua stocks.

Paua farms have so far proved difficult to run profitably but Hope-Johnstone believes the company's system overcomes the problems.

"There has been a few started around the country that have not been successful, but with every one of them you can put it back to weather conditions or filtration problems," she said.

The closed recirculating seawater system developed by Silverdale Marine Hatchery doesn't rely on coastal water conditions.

Sea water is trucked into the plant once and is then recycled.

The temperature and nutrients are all controlled by the farmer and the farms can be located anywhere.

"There's no reason why this system can't go to Taihape or somewhere," she said.

Eventually the company would look to sell the system around the country, but for now it was concentrating on increasing its own production.

Worldwide abalone supply has been dropping since 1960.

"We know we can sell the meat for $120 a kg - in Auckland its selling for $195 a kg retail," Hope-Johnstone said.

"It's the Asian countries driving demand as they get richer. Abalone is like caviar is to Europeans."

Despite those prices Silverdale Marine is basing its expected returns on price of $85 a kg. It is about to seek investors for the expansion and will have a prospectus ready to go in the next few months.

The company is also setting up a joint farm in Malaysia.

"They are absolutely starved of Abalone over there," Hope Johnstone said.

The best way of selling New Zealand paua is live. Asian chefs cook them in the shell, the colour of which makes them a novelty.

"That is part of the marketing attraction," she said.

The downside is that New Zealand paua meat is darker, so Asian markets need to be educated.

Chinese customers are not overly concerned about the difference in colouring, but it is not popular with Japanese consumers.

Despite doing no advertising the paua farm already struggles to keep up with demand for its meat.

"We have people now coming and buying what we have frozen and taking it out of the country," Hope-Johnstone said.

The first phase of the expanded operation should be operational in six months.

From there it is just a matter of growing the paua and exports of small cocktail paua should be underway within 18 months of the plant being commissioned.

That size is popular in the American market, but it is the larger shellfish that earn big money. They can take up to five years to grow to lengths of about 10cm, but can fetch up to US$20 ($33) each in Beijing.

BEHIND THE QUOTAS

* New Zealand's paua fishery is managed by strict quotas. The Total Allowable Commercial Catch was set at 1221 tonnes for the 2000-2001 fishing year.

* Restrictions on size and harvesting method also apply to wild paua: they must have a minimum shell length of 12.5cm and can only be harvested by free-diving - the use of underwater breathing apparatus is not permitted.

* Total exports of paua in the year ended December 2000 were worth $66 million.

* Nearly all New Zealand paua is exported to the western Pacific Rim. Singapore and Hong Kong together take over 80 per cent of all exports.