China’s aquaculture production will be flat in coming years, but there will be growth in premium species like eels and croaker, according to the head of a top Chinese feed firm in the country.
Hansen Lee, vice president of Coland Holdings Co. (also known as Coland Group and by the Mandarin name Gao Long), said a previous surge in aquaculture production of species such as crayfish, catfish, and tilapia now looks to be on hold.
In interior areas of the country, such as Hubei Province, land is cheaper, but an environmental crackdown and changing governmental priorities appear to be quashing growth in aquaculture, Lee told SeafoodSource.
“We don’t see any increase in aquaculture … in the future due to resources limitations,” he said.
The coronavirus has exacerbated preexisting issues with China’s aquaculture sector, according to Lee. There’s now a “big problem” in delayed pond cycles and deep uncertainty is leading many to steer away from further investments at all levels, he said.
However, Lee predicted demand for aquaculture would grow in coming years, as China’s government is encouraging investment in specialty, premium seafood products including eel and yellow croaker. Eel farmers are moving into mountainous areas of Fujian Province – Coland’s home base – to avail themselves of better water conditions and incentives offered by local governments, according to Lee.
Aquafeed currently represents 10 percent of total feed produced in China, but Lee said production totals will rise as demand grows for premium species like crustaceans and carnivorous fish, such as grouper. Offshore aquaculture – a small but rapidly growing sector in China – has potential to increase feed demand even more, but not for several years, Lee said.
“Not now,” he said. “it needs time to prepare.”
Coland exports feed to Japan and South Korea, but the company won’t be shipping large volumes to key southeast Asian aquaculture powers like Indonesia or Vietnam due to governmental incentives giving strong preference to local producers. But the company may consider investing there, and is also looking at Iran and South Asia for investment opportunities, Lee said. But it must be the right opportunity – for now, there’s plenty of profits to be made at home in China, he said.
“China is already a good market for us, we are in a good area and have much room to expand,” he said. “Now is the time to develop production, as later it will be more and more difficult [given increasing competition].”
Coland’s membership in IFFO, the trade group for the marine ingredients industry, has been a boon to the company in that it offers access to the organization’s research, Lee said. For instance, Lee said the company has closely studied research on the impact overfishing of juvenile fish for use in fishmeal has been having on the food security of local populations in Africa. Lee said the issue of illegal fishing and overfishing in West Africa, where sourcing for ingredients for use in Chinese fishmeal production has been rising, can be solved by implementing management plans similar to that in place in Peru.
Lee also said a better use of byproducts created by freshwater processing factories in China could be a way of getting around imbalance between supply and demand in fishmeal and fish oil.
“Sometimes it can’t take the place of seawater fish meal one hundred percent, but it partly can,” Lee said.
