The Future of Fish: Investors Get Into Sustainable Aquaculture
Farmed or wild? Local or imported? Organic? Or some certification you've never heard of?
Anyone who has tried to be an eco-conscious seafood consumer—or seen headlines about plummeting wild fish stocks or antibiotic-laden seafood from farms in China—has faced these questions.
There are many more. Take farms, whether inland or in the ocean. So much depends on the particular operation. Are antibiotics used to fight disease in overcrowded pens? What's the feed made from, and is too much provided? How much waste do the fish create? Are the currents strong enough to disperse all of that? What is the ocean floor like? Are the fish native?
"With fish, people come in and debate," said TJ Tate, director of the Sustainable Seafood Program at the National Aquarium in Baltimore. "Consumers want to see a tag, a label, a box, something they can feel confident about, and grab it and go."
"A lot of labels are private or secretive or changing or flexible," said Marianne Cufone, executive director of the Recirculating Farms Coalition. Some are more respected than others, and it's hard for the average consumer to know the difference. While Canada and the EU have organic seafood standards, the U.S. does not.
Now, entrepreneurs, investors, and some environmentalists are beginning to coalesce around aquaculture as a potential long-term solution to the depletion of the oceans and the world's increasing appetite for this healthy protein. A 2016 report from the United Nations found that 31.4% percent of the world's stocks were overfished and another 58.1% fully fished. Meanwhile, aquaculture surpassed wild-caught fish as a source of seafood for human consumption in 2014. Many see it as the next frontier in sustainable food production.
"We're eating more seafood globally, which is a good thing because it's healthy, but we're taking more than the ocean can naturally replenish," said Amy Novogratz, managing partner of Aqua-Spark, a Netherlands-based investment fund focused on sustainable aquaculture businesses. "Aquaculture is known a little bit for its bad reputation, and some of it is deserved," she said, referring to issues like China's use of antibiotics and fish feed made from wild-caught species. "But it's a young enough industry that you can go in and rebuild it a little, so as it grows, it grows more sustainably."
Aqua-Spark invests all along the aquaculture supply chain, from Calysta, a Menlo Park, California, company making feed from methane-eating microbes, to eFishery, a developer of feed delivery machinery in Indonesia, to Matorka, an Icelandic land-based Arctic char farm, and one of its latest portfolio additions, Love the Wild, of Boulder, Colorado.
Love The Wild
Love the Wild sells frozen, single-serving, boxed fish filets that come with sauce, parchment paper, and cooking instructions, so user-friendly that even a novice in the kitchen could make them. Each box includes the name of the farm, its location, managing partner, and any certifications it has earned. In March of 2016, the products were available in only two stores in Colorado. Now they're sold in nearly 700 stores in 33 states, at major retailers like Whole Foods, Wegmans, and Price Chopper, as well as smaller single stores and co-ops. Leonardo DiCaprio has signed on as an investor and advisory board member.
The company offers five products, each a different species from a sustainable fish farm, like Barramundi with Mango Sriracha Chutney, and Catfish with Cajun Creme. The barramundi is raised in an open ocean net pen in Vietnam, while the catfish comes from pond systems in Alabama and North Carolina. The farms are scattered around the world and use different systems and technologies, but they have a similar ethos. And while Chief Executive Jacqueline Claudia is proud of the sustainable practices each employs, she admits there is plenty of room for improvement. "We'll never feel our products are sustainable enough," she said.
On top of rigorous third-party audits, Claudia visits each farm frequently to make sure it is living up to her standards—for example, that the feed minimizes the use of primary-catch wild fish to avoid taking them out of the ocean, and that the fish meals the farms do use come from processing waste that would otherwise be used as fertilizer anyway or end up as garbage. The company is actively working to reduce reliance on marine proteins, using soy and other grains instead. "We want to move towards microbial, insect, and algae-based feeds," Claudia said.
The company also looks at the aquaculture systems' management practices, including the way waste is handled, the site of the farm and density of its fish stocks, and the treatment of the workers.
As for escapes, a major problem in open ocean aquaculture, some are inevitable. Predators, like sharks and seals, will try to chew through the pens, oceans are unpredictable, and human error is a risk. The strategy is to minimize the impact they can have.
"Pen technology should be suitable for the area where it's located. Sometimes that means double or triple layer," Claudia said. "And we only work with species that are considered native or indigenous to the area where they're raised. If one gets out, it's not introducing something new." Love the Wild's catfish is raised in ponds and its trout in raceways, artificial channels that have a continuous source of water flowing through them.
"Jacqueline is very detail-oriented," said Tate, of the National Aquarium, who endorses Love the Wild, and has no financial interest in it.
Proponents of land-based aquaculture systems say these can be a better option because there is no escape risk or waste discharged into the oceans. "Water is constantly being recirculated in our systems, so there is no waste runoff," said Cufone, of the Recirculating Farms Coalition. Claudia says her inland farms also have no waste runoff—the ponds are contained with a clay bottom and the raceways use a filtration system that cleans the water before it is discharged into the river.
"We worry about open ocean aquaculture," said Patty Lovera, assistant director of Food & Water Watch, a consumer and environmental advocacy group. "It depends on how big and where. A huge question is what you feed those fish." She added, "It's hard to know unless you're going to get on a boat and go out and look at it."
Other environmentalists see an opportunity in open ocean aquaculture, even if it isn't risk-free. "Whether from terrestrial plants or animals, the production of protein will use land, freshwater, and energy," said Aaron McNevin, director of markets and foods at the World Wildlife Fund. "The open oceans represent a very remote area with the ability to naturally process wastes in the vast waters much beyond the capacity of our freshwater systems to process agricultural runoff."