Danish tilapia, black tiger shrimp farmer DanMarin aiming for expansion in West Africa
Dronninglund, Denmark-based aquaculture firm DanMarin A/S – part of the Kangamut Group – has one of the best-organized pond-based aquaculture farms in West Africa, where it grows tilapia and shrimp. DanMarin A/S CEO Rajiv Banerjee talked to SeafoodSource about the company's goals in Africa and the outlook for West Africa's aquaculture sector.
SeafoodSource: What is your experience of the African aquaculture market, and what opportunities do you see for international private investors in it?
Banerjee: I am a trained fishery professional who has been associated with global fisheries for 24 years, including fish-trading and aquaculture operations across continents although West Africa has always been at the center of my career.
I do see a huge investment opportunity for the international private sector. Aquaculture projects all over Africa are healthy and safe business models that support the region’s economies and generate rural employment, in addition to providing affordable high quality protein for the local markets.
SeafoodSource: Can you describe the pond-based farm that you operate in Ghana?
Banerjee: The aquaculture sector in Ghana is well-established. However, to my knowledge, almost all the organized tilapia farms are cage-based, mostly in the Lake Volta region. In 2008 and 2009, I was a part of this revolution in cages. When I got the opportunity to develop a new farm in 2014, I had to think of a better model that was more sustainable, and I realized then the future belongs to the land-based farms because they are more advantageous compared to cage-based fish farming.
Our farm in Ghana is under constant expansion and currently we have 100 acres under production. Under normal conditions the farm is designed to produce more than 600 metric tons [MT] of tilapia and slightly over 120 MT of black tiger shrimp, although we are flexible and can adapt to market demand by growing more shrimps by allocating more ponds and adding more species using the same infrastructure.
However, the past two years have been challenging, such as in 2019 when Ghana’s aquaculture segment was hit by disease, a situation that continued to 2020. The situation worsened in 2020 when fresh fish markets had to close for three to four months due to outbreaks of COVID-19. Despite these challenges, we are optimistic 2021 will see stability of production and witness a bounceback of Ghana’s aquaculture market.
SeafoodSource: Do you have similar or related operations elsewhere in Africa?
Banerjee: I have also been involved in Nigeria and India, but I guess comparing these markets can be difficult because the basic parameters in the performance of each aquaculture market differs from country to country. For example, in Nigeria, consumers prefer catfish, while in Ghana, there is a preference for tilapia. Also whereas Nigeria allows importation of foreign species/strains, Ghana has banned importation of fingerlings and instead supports local development of the required strains through selective breeding. Overall, there is scope for growth of West Africa’s aquaculture market despite each country having unique drivers and constraints.
SeafoodSource: What are some of the factors that support similar pond-based farms in Ghana and elsewhere in West Africa?
Banerjee: Currently, to my knowledge, we are the only natural earthen pond-based organized tilapia and shrimp farm in Ghana. A pond-based farm such as ours has some distinct advantages, such as being environmentally friendly, high on biosecurity, and a better FCR supported by our implementation of good farm practices and good water management practices. Additionally, we do not exchange water in the whole production cycle but only top-up the evaporation loss. We recycle and reuse our pond water, and hence have a very low intake of new water. Furthermore, we use probiotics, which is the base of our natural farming practices, for healthy gut and to clean the pond bottom. We use the same brackish water for tilapia and shrimp, hence giving a unique advantage in the taste, texture, and color of the tilapia. It is a natural branding for us.
SeafoodSource: What are some of the constraints that you see that should be tackled to encourage growth of aquaculture in Ghana and West Africa?
Banerjee: Every country in West Africa has their own unique bottlenecks. In Ghana, we appreciate the government policy opposing indiscriminate imports of foreign species/strains. However, we request the government allow direct importation of superior strains of different species that can then be supplied to responsible farmers for production. This will greatly help the aquaculture industry to be more productive and evolve in a responsible manner. Moreover, although most West African countries have banned the importation of frozen tilapia, cheap imports of tilapia somehow find their way to the markets. This makes developing thriving tilapia/catfish farming difficult, hence the need for enforcing an absolute ban on imports of these farmed fishes.
Across West Africa, the sector requires streamlining of tax and levy payments by, for example, setting up a single clearance window for transparency and enabling investors predict what to expect in their tax obligations. Investors can also be supported to bring down the cost of production in aquaculture if governments in West Africa allowed duty-free imports of key inputs such as equipment, specialized feed, probiotics, and water-testing kits.
Financing of aquaculture enterprises is also a challenge, as getting credit facilities is not easy. For example, despite our company having a successful project on ground, we find it extremely difficult to get an overdraft facility from banks. The market needs policies that support short-term, safe financial packages to meet urgent cash-flow obligations of the fish farmers.
SeafoodSource: Are you growing the tilapia and black tiger shrimp for the Ghanaian market or are you targeting the international market?
Banerjee: Ghana is our market for the tilapia and shrimp, with the tilapia market being the biggest. Currently, we have about 5 percent share of the tilapia market while the limited production of shrimp is all consumed in the domestic market. There are also interested buyers of our farmed tiger shrimp that come from Togo and Benin.
SeafoodSource: What sort of potential do you see in Ghana and West Africa’s tilapia and tiger shrimp market over the next five to 10 years?
Banerjee: We see tremendous potential with both the tilapia and shrimp, with tilapia currently being a staple diet providing high quality protein, food security, jobs, and an alternative to food imports. West Africa is just entering into shrimp aquaculture, but there is immense opportunity to grow production under modern, disease free and sustainable models. Furthermore, integrated farms with multiple species, like our farm, define the future of aquaculture. An integrated multispecies farm develops a unique natural synergy. This approach allows for spread risk and gives us the possibility to simultaneously target the domestic and also the export markets.
SeafoodSource: What are some of the short- and medium-term goals for your Ghana project? Do you have plans to expand to the rest of Africa?
Banerjee: The most important goal was to set the strong core values based on biosecurity, sustainability, being environment friendly, and CSR. We have also successfully achieved our short term operational goal by stabilizing the production matrix of tilapia and shrimp in a new brackish-water farm. Our hatchery has also developed third-generation brooders from the disease infected lots which produce seed that are more resistant to the current disease. We now have 100 acres under production with own strong distribution network and an online app for retail sales.
With some support from the government of Ghana and institutional partners, we would like to develop this multi-species integrated farm to about 1,000 acres in the next about five years, producing 5,000 MT of tilapia and 500 MT of shrimp. In addition, our long-term plan is to have a factory for value addition as we wish to export our high-quality shrimp.
Photo courtesy of DanMarin A/S