Agrimarine, a Canadian salmon firm with Pacific salmon farms in China, has decided to focus on sales of live fish in the country's northern provinces. The firm was unable to supply the volumes sought by Japanese retailer Ito Yokado and now sell to wholesale markets in cities Dalian and Shenyang, near its aquaculture base in northeast China, according to the company's former CEO and head of operations here Richard Buchanan.
Significantly, the firm is closing its Beijing office and passing full control of the Chinese production base to Chinese staff. Buchanan said he sees the handover as a sign of success and believes the operation will meet a target of one million fish per year, twice the current output.
Agrimarine is currently getting an average RMB 45 (USD 7.35, EUR 5.35)/kg for its salmon — that compares to RMB 70 (USD 11.44, EUR 8.32) it charged to retailer Ito Yokado (which sold the salmon at double that figure). Each of three stores sold on average four to five 25kg cases of Agrimarine salmon per week, said Buchanan, and Agrimarine's in-store surveys showed householders opted for the Pacific fish due to its price (40 percent cheaper than imported Norwegian salmon) while the smaller sizes allowed some consumers to take home a whole fish. He said he sees advantages in switching to being the smaller size of the live fish: "Asian consumers like a 700g fish sold live."
However one challenge of selling Pacific salmon varieties like chinook in live form is the lively nature of the species: "they're not docile, they don't sit in tanks very well." Buchanan said he sees long-term potential in barramundi (often labelled Asian seabass in China) in the Chinese market. One drawback of the firm's RAS system is the fish flesh tastes muddy.
Agrimarine, which has taken investment and loans from Dundee Agricultural Corp, had sought investors for expansion of its China operations. Would-be investors wanted to wait to see positive cash flow and results out of China before committing investment, said Buchanan. "Others were concerned the technology was too advanced for Chinese farms." Chinese investors meanwhile were keen to get access to the firm's considerable land bank (10,000 square meters) in Benxi while also exercising control over the operation. "Ultimately the investment has gone into Agrimarine in Canada," he said.
