How to break the salmon farming industry

How some people would like to see salmon farming in B.C. end up.
How some people would like to see salmon farming in B.C. end up.

There are several groups of people who would like to see salmon farming in B.C. die a quick death.

Anti-salmon farming activists, obviously, who oppose it for a variety of emotional reasons.

But the real opposition comes from groups with economic clout. Groups who don’t necessarily want salmon farming to die, but want to find some way to “break” it so they can secure their own financial future.

Before we explain, let’s look at some numbers.

There’s a great big market out there worth billions of dollars, at home and abroad. Who wouldn’t want a piece of it.

But the problem is, people in the grocery store are mostly concerned about availability, nutrition and price.

Is farmed salmon available? Year-round, check. Is it nutritious? Check. Is it affordable? Check.

Alaskan marketers have done a brilliant job in the last decade of marketing their fish as a premium product, selling the image and wild feeling of Alaska rather than what is, which is, quite honestly, a not-very-tasty piece of frozen-at-sea pink salmon.

But still, most people in the grocery store couldn’t care less if there’s a picture on the package of a rugged fisherman holding up a salmon like Rafiki the monkey holds up Simba in the Lion King. If it’s not affordable, they ain’t gonna buy it.

Wild salmon marketers need to be smart. And here’s how they can break the B.C. salmon farming industry, putting it in a place subservient to their own interests.

Follow the example of Canadian beef

In 2002, Canadian beef was worth $1.4 billion in trade (value of exports over imports).

In 2011, that value had plummeted to $42 million.

What happened? Mad cow disease.

On May 20, 2003, a lab in Britain used as a reference lab by the OIE confirmed that one cow in Northern Alberta had BSE, an animal disease which may have a connection with Creutzfeldt-Jakob Disease in humans. Within hours of the confirmation, the USA closed the border to all Canadian beef. In retrospect, this was pure opportunism. The cow never entered the food supply, and the Americans’ downplaying of their own BSE cases a year later was hypocritical in comparison.

The ensuing fiasco had a ripple effect, which continues to affect the Canadian beef industry nearly 10 years later.

“Canada with all its natural, quality and production benefits is at risk of becoming a net importer of beef,” the Canadian Agri-Food Policy Institute reported in September this year. “The cattle cycle is presently experiencing lower production numbers but there is also no apparent strategy to regain valuable domestic market share.”

And the export market doesn’t look much better.

On the export stage, the Canadian industry is extremely reliant on one market — the USA, a market that accounts for 85% of Canada’s beef and cattle trade. The good news is the US generates $1.8 illion in total sales for Canada (nearly $1 billion in beef exports and over $800 million in cattle exports). The bad news is Canada is “backfilling” the US market; that is, by relying on Canadian cattle and beef supply, the US beef industry is expanding its exports and taking advantage of higher value and margins. And the Canadian industry appears to be content to let that happen.

The road to ruin

B.C. farmed salmon producers could find themselves in the same position, if they’re not careful. The path is already laid out for this to happen.

Factor one: wild salmon marketers have spent the past decade trying to convince people wild salmon is so much better than farmed.

Factor two: it’s only a matter of time before ocean aquaculture comes on line in the USA. Once it does, B.C. farmers had better have a plan to deal with it.

Factor three: B.C. is already “backfilling” the US market, providing cheap, nutritious farmed salmon available year-round to American customers while wild marketers work on expanding their markets and their profit margins by convincing people it’s worth paying more for a fish that was caught farther away and frozen at sea.

All it would take is a crisis in confidence, e.g. hysteria over ISA as prompted by anti-aquaculture activist Alexandra Morton, to motivate the USA to close the border to Canadian salmon, like it did for beef.

If that happened, who would profit? Wild salmon marketers, who would be able to increase their prices to meet demand, prices they haven’t enjoyed since the glory days of the 1980s when Alaska met nearly half of the world’s demand for salmon.

Would B.C.’s salmon farmers recover from something like that? Probably not.

Hopefully B.C. salmon producers, and Canada’s politicians, are not content to let this happen.


2 thoughts on “How to break the salmon farming industry”

  1. Hi

    Theres a typo in your latest article�.

    Factor one: wild salmon marketers have spent the past decade trying to convince people wild salmon is so much better than wild.

    All the best

    Chris Hyde Managing Director

    OceanTools Aquaculture Ltd

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s