By Brian Kingzett*
British Columbia produces Pacific Oysters, Manila Clams and Japanese Weathervane scallops, and Blue and Mediterranean (Gallo) mussels of very high quality. New species include the highly valuable geoduck clam, and potentially the fast growing native basket cockle and local sea cucumbers.
Shellfish farming with its reliance on pristine water quality provides an inherent environmental ethic and increasingly important, a source of sustainable seafood protein with a low carbon footprint. BC’s enviable position on the Pacific rim provides transportation linkages and it enjoys high quality food safety oversight and good business practices. Even though first attempts at farming oyster in the province were made as early as 1882, achieving anything close to the biological potential of the industry has, however, remained elusive.
In 2012, the province’s production had a farm gate value of CDN$21.9 million and CDN$41.1 million wholesale, just a drop in the bucket compared to approximately CDN$400 million for the aquaculture of salmon in the Province. Shellfish production has been relatively static for the last decade. This is troubling when compared to the rate of growth in other jurisdictions globally, but in particular to countries such as New Zealand with similar regulatory regimes that had similar levels of production in the 1980’s but now 10-fold more production. The BC industry has been largely made up of small family farms with 327 companies operating more than 500 sites but only occupying about 6 km2 of marine tenures in 2012. To put this in context, at 200 metres wide this would occupy 18 km or less than 0.01% of BC’s coastline. Additionally most farms are operating well below production capacity.
Any discussion of why the industry has not yet reached the potential of its optimistic cheerleaders inevitably leads to a long list of factors. These include the regulatory burden of federal regulation which historically has handled aquaculture as the “bastard child” of the Departments of Fisheries and Agriculture, both bearing responsibility but neither completely willing to acknowledge it. But also good R&D support, access to large sites, technical expertise within the industry, access to risk capital, unresolved issues around aboriginal (First Nation) rights and title to marine lands and simply being too small to be efficient or capture large market opportunities.
The last decade has been difficult for the industry. At the same time that North America has been experiencing a long overdue oyster renaissance, the BC industry has faced a high Canadian dollar exchange with the US, shortages of oyster seed due to ocean acidification and more pressures from coastal conflicts in the existing areas in which it operates and, inevitably, some consolidation and fragmentation within the industry. Scallop farming in the warming Strait of Georgia has been plagued by mortality and the success of new species such as geoducks and sea cucumbers has been held up by lack of licensing policy.
During this time however, some have been able to reinvent themselves often by carving out their own niche within the value chain. Examples include small farms like Paradise Oysters, Holliewood Oysters and Sawmill Bay Shellfish all of which have been able to take advantage of the trend of micro-branding and the exploitation of the oyster “merroir” trend. Stellar Bay Shellfish developed the tumbled and uniform “Kusshi” oyster which has singlehandedly raised the bar for oyster quality and is now extremely well known throughout North America. Taylor Shellfish Farms, the now 5th generation family-owned Washington State shellfish company, has made significant acquisitions in BC and brought with them stability and confidence. Ultimately, it should never be forgotten that Vancouver Island grows some damn fine oysters.
The regulatory burden of aquaculture, necessary to justify public confidence, is not going to go away anytime soon and BC’s regulatory climate is still much better than some. It will be interesting to see whether the small BC farms, many of whose operators are approaching retirement age, will be able to continue forward without more capitalization and increased production as business costs increase. This unfortunate consequence has a parallel in BC where there were once more than 100 salmon farming companies. Production issues, narrow margins dictating production efficiencies, lack of government support and increasing regulation were among some of the issues that forced consolidation to the handful of companies that remain. Arguably, the survival and then success of the BC salmon farming industry was the influence of patient Norwegian capital that saw the light at the end of the tunnel when no one else would.
Moving forward, will this repeat itself in the BC Shellfish industry? A number of factors suggest that the industry is poised to advance and that at the very least an industry with a more diverse scale of companies could emerge. Firstly, the industry is starting to follow other shellfish areas and get more efficient and capital intensive. Educational institutions like Vancouver Island University (VIU) and North Island College are offering aquaculture training at the post-secondary level. VIU in particular, through the Centre for Shellfish Research, Deep Bay Marine Field Station and Institute for Coastal Research has been establishing platforms for R&D support. New hatcheries are being built in BC that should help with seed shortages. Exchange rates have become more favourable and government support is slowly improving.
The most significant game changers are starting to emerge: BC First Nations and the influence of Asian capital. More than 21 First Nations have been exploring shellfish aquaculture opportunities but have typically been undercapitalized. To date, the K’ómoks First Nation (Pentlatch Seafoods) with their excellent Komo Gway oysters have been leading this group. Shellfish culture in China is now worth more than USD$9 billion and requiring more production. A number of Chinese investors are now looking to, or establishing, operations in BC. Access to sites with scale to support significant operations has more chance of success if they partner with First Nations who can control access. Will Asian patient capital be to the shellfish industry what the Norwegians were to the salmon industry - except in partnership with First Nations? One example that has emerged is Coastal Shellfish in Prince Rupert that may represent the future: Ownership by North Coast First Nations; local as well as technical expertise from the Chilean scallop industry; social venture capital and Chinese Investment. After 10 years of R&D this company just closed the loop and began its first harvest of “Great Bear Scallops”.
*Brian Kingzett, M.Sc., is the Manager of the Vancouver Island University Deep Bay Marine Field Station. He has worked in the B.C. shellfish industry, from clam digging to conducting research, since 1986.