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While the supply of natural-water fish declined over the past year, demand continued to rise.
Overfishing in the oceans has damaged ocean ecosystems and increased pollutants. Rising salmon prices are one reflection of a growing desire for sustainably produced, healthy sources of protein, and new technology has been developed to meet the demand.
Land-based recirculating aquaculture systems (RAS) use technological solutions to farm fish in controlled, environmentally friendly tanks, which conserve more water. With COVID and the Ukrainian war drawing attention to the fragility of supply chains, a shift toward locally sourced solutions in America is expected as the U.S. currently imports 90% of its seafood.
Some companies are beginning to make the change. One is AquaBounty Technologies Inc. (NASDAQ: AQB), an Atlantic salmon fishing company with RAS system farms in America and Canada. AquaBounty recently started a $290 million-plus farm in Ohio, predicted to bring in over 100 jobs.
A similar company is Blue Star Foods (NASDAQ: BSFC). Blue Star uses RAS to focus on premium seafood, such as salmon and soft-shell Atlantic crab. It has the longest continuously existing RAS salmon farm in America.
Both of these companies focus on premium fish, while another company produces RAS that it says is great for farming more affordable options like tilapia or catfish, although it’s also suitable for many types of fresh or seawater fish.
A significant problem for the industry is that farming salmon is a high risk and high investment operation, and does not provide an easy solution to the overall food crisis. Even at the demographic level, fish like salmon aren’t king — most minority ethnic groups in the US eat catfish and tilapia. Even now after COVID, prices of catfish and tilapia are catching up to salmon due to a variety of factors. US-raised catfish filets are reportedly priced around $8.99 a pound, possibly presenting a seriously large opportunity for companies looking into farming them.
Bringing Together Efficiency And Affordability?
Nocera Inc. (NASDAQ: NCRA) is a Taiwan-based aquaculture company focused on sustainable and local fishing practices that is bringing RAS technology to America. Nocera believes that RAS is the future of fish farming because of its sustainability and it believes the affordability of its systems will overcome the hesitancy that many U.S. fish farmers currently feel.
One element of the RAS that Nocera praises is its lack of dependence on both large water sources and inclement weather conditions. The RAS allows control of fish health and can be housed at almost any site. All this while, its efficient system - recycling 90% of the water it uses - uses fewer resources than traditional pond or river farming.
Unlike many of its competitors, Nocera is an engineering, procurement and construction (EPC) company, meaning that it not only designs its RAS technology but also procures and constructs these systems on-site. Nocera says it is the only total-solution RAS company in Taiwan.
It also argues that its cost-effective materials make it a cheaper and simpler option than what its competitors offer, all without sacrificing the quality of the product — and it concentrates on fish that are resilient and easy to farm like catfish and tilapia, that have historically been overlooked but now have highly attractive margins.
Nocera touts the simplicity of the RAS design, which allows easy construction. Any RAS system can be installed by five workers in less than six hours, and it is designed to be used multiple times - meaning it can be dismantled and relocated to another site with relative ease.
The affordability of the tanks, when matched with their simplicity of construction, is part of Nocera’s mission to empower smaller farms with opportunities that make them competitive.
A recent article argued that RAS is often not profitable, partly because of the generally high up-front costs farmers must pay for the system. However, Nocera prides itself on the affordability of its RAS tanks, which start at $35,000. These tanks can hold up to 80 times more fish than traditional farms, which Nocera says makes them a preferred option for small farmers.
Nocera increased its profits for 2021 by 733% year-on-year, with revenues for the year coming in at $9.9 million.
“Fiscal 2021 saw strong growth in our construction services division,” Nocera CEO Jeff Cheng said. “We expect there to be continued strong demand for our recirculating aquaculture systems as well as construction services.”
To learn more about Nocera Inc., visit its website.
Nocera, Inc. is an engineering, procurement, and construction (EPC) company that designs, builds, and installs equipment for the fish farming industry, as well as provides technical assistance to fish farm operations. Our Recirculating Aquaculture Systems (“RAS”) help preserve the environment by reducing pollution from over concentration of fish as often occurs in fish farms based in natural inland waterways or bodies. Nocera’s RAS tanks can produce 20,000 – 30,000 lbs. of fish annually.
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Christine Petraglia - TraDigital IR