After a decade of trying to be China’s top local producer, China’s salmon farming pioneer has sold its assets to a state-owned conglomerate.
Shandong, China-based Oriental Ocean has gotten CNY 226 million (USD 31.6 million, EUR 29.3 million) for its “salmon-raising facilities” in the Dajijia industrial zone, near the city of Yantai on China’s east coast, according to a company letter to investors. The buyer is a new joint venture controlled by state-owned behemoth holding company Qingdao Guoxin Development (Group) Co. The new firm, Qingdao Guoxin Oriental Recirculation Aquaculture Co., is 70 percent controlled by Guoxin, with Oriental Ocean holding the remaining 30 percent stake through a subsidiary.
Listed on the Shenzhen Stock Exchange, Oriental Ocean made a decade of attempts to cash in on China’s growing taste for salmon. It vowed to replace imports with local salmon cultured using land-based tanks and fry from Norway. It also partnered with the Ocean Research Institute of the Chinese Academy of Science in a breeding program that supplied the finished fish live to retailers including the JUSCO supermarket (a subsidiary of Japan-based AEON), which retail the fish in water tanks – a format long preferred by Chinese consumers wary of freshness in buying fish.
“Capital and technology is required to truly realize the potential of salmon business,” Oriental Ocean explained in its note to investors. The company will retain and expand its other businesses, which include processing and sea cucumber cultivation, it said.
This is not Qingdao Guo Xin Development Group’s first foray into aquaculture. Last year, hired China State Shipbuilding Corp (CSSC) to build a 100,000-ton aquaculture platform to be docked in the Yellow Sea. Additionally, the firm has been constructing artificial coral reefs and inserting aquaculture cages into the waters off Qingdao as part of a USD 1 billion (EUR 926.2 billion) investment that will include hatcheries, cold-chain logistics, and a related tourism projects on adjacent islands off the coast of Qingdao.
And the company expects to continue to invest in the sector, it said in its note to investors – it plans to target other near-shore and offshore aquaculture opportunities in coming years.
Seafood will become a new driver of profitability for his group, Guo Xin CEO Wang Jian Hui told Qingdao TV news late last year, as the firm unveiled plans for aquaculture and seafood-related health and medicinal products through its new venture.
Photo courtesy of Sorbis/Shutterstock
