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Aquacultures –
What’s the catch?

A closer look at the sustainability of fish farming

For generations, the fish stocks of our oceans were seen as an inexhaustible resource. But state-of-the-art fishing fleets are now overfishing our waters and fish populations are dwindling rapidly. Fish farms can offer an alternative, but also bring problems of their own.
The world’s population is growing. At present, our planet is home to around 7.5 billion people but by 2025, this figure could climb as high as nine billion. All of these people will need to be fed, and fish is an important food resource. But population growth is not the only factor in this equation. Rising prosperity has also led to an increase in consumption. Annual fish consumption per capita has gone up from 15 kilograms in 1980 to 23 kilograms in 2016. The deep-sea and river fishing industries are already exploiting wild stocks to the maximum and many species are overfished. Farming fish in aquacultures could alleviate this problem and fill the existing demand gap. Fish farms could help feed the global population whilst also protecting the rich biodiversity of our oceans. Around 3,000 years ago, farmers in ancient China developed methods of growing fish in artificial ponds. Much has changed since then. The aquacultures industry is one of the fastest-growing areas of food production. Almost half of the global food fish supply originates from aquacultures. In concrete terms this means that nearly 50 million tonnes of farmed fish and seafood per year is produced in controlled environments. But aquacultures also entail risks for the environment, animals, people and ecosystems.


An increasing proportion of the fish we eat is reared in fish farms

China is one of the main users of aquacultures
An increasing proportion of the fish we eat is reared in fish farms

Intensive farming under water

The majority of fish reared in aquacultures are kept in open systems, i.e. the farm enclosure is directly connected with its natural environment. In most cases, these systems are floating open-net pens set up in coastal waters. This farming style allows antibiotics, chemicals, feed residues and fish excrement to spread to the surrounding sea and contaminate the ecosystem. Fish feed and faeces also sink down and contaminate the seabed below the enclosure. Paradoxically, fish farmers still need to go out and catch smaller types of wild fish in order to feed it to their farmed fish. The intensive farming conditions in small enclosures are not appropriate for the species of fish reared in aquacultures and are detrimental to animal welfare. And there is more: Keeping large numbers of animals in a confined space allows diseases to spread more quickly. For consumers, this means that the antibiotics given to fish stocks to ward off diseases end up on their plates, which, in turn, exacerbates the problem of antibiotic-resistant strains of human diseases. Moreover, aquacultures also pose a risk to biodiversity. Fish grown in these systems are highly robust and can withstand most environmental influences. If farmed animals escape into the natural environment, they can disturb the balance of the local ecosystem and pose a threat to other types of wild fish.


Use of antibiotics in salmon farming

Comparison between Chile and Norway
 
Use of antibiotics in salmon farming

Shrimp farms often cause issues from the onset

Shrimp farms are an extreme example of unsustainable practices in marine farming. They are typically located in tropical regions of Africa, South America and Asia. Shrimps are best grown in shallow water, so these farms are often set up in areas occupied by mangrove forests, which are of great ecological importance as well as being endangered. According to reports by the World Wide Fund for Nature (WWF), two thirds of all mangrove forests in the Philippines alone have been cut down to make way for shrimp farms. Estimates of the Food and Agriculture Organisation of the United Nations (FAO) suggest that around 3.6 million hectares of mangrove forest have been destroyed since 1980 – in many cases to make way for shrimp farms.

 

Salmon farm in Norway
A salmon farm in the waters of the Norwegian Lofoten archipelago.

#Salmon farming in Norway

With a market share of around 20 per cent, salmon is the most popular fish eaten in Germany and 90 per cent of the supply originates from large aquacultures in Norway.

The country‘s waters are home to more than 2,000 salmon farms that grow around 400 million fish in net pens.

Visiting a fish farm in Norway

In June 2017, Duy Ton, a portfolio manager in the Sustainability and Engagement team at Union Investment, travelled to Kjeahola near Stavanger in Norway to visit a fish farm operated by Marine Harvest (MHG). His assessment after the visit was that “Marine Harvest is a food company that is moving in the right direction in terms of sustainability”. The Norwegian company is the biggest salmon farming enterprise in the world, with operations in Norway, Scotland, Chile, Canada, Japan and many other countries.

“We have been working with this company for almost ten years,” says Duy Ton. He confirms that significant improvements have taken place over the course of this period. For instance, the company has largely stopped using antibiotics and has phased out their use altogether at its farms in Norway. It has also enhanced its efficiency in the use of fish feed. To produce one kilogram of fish meat, the company needs 1.13 kilograms of feed and it is steadily increasing its use of alternative types of fish feed. Wild fish is supplemented with algae and other proteins, which has brought the amount of wild fish required to produce one kilogram of salmon down to 0.77 kilograms. “A few years ago this proportion was still significantly higher,” Duy Ton recalls. MHG produces around 75 per cent of its feed in-house. It also uses fresh water from the mountains, which is recycled after use and fed back into the ocean.

“We definitely welcome the progress that has been made in all of these areas. But there are still a few challenges remaining that we will continue to address,” Duy Ton concludes. These include, for example, the use of chemicals in the production of fish feed to extend its shelf-life. It is a handy thing to do from a production point of view, but there are significant downsides for the environment and personal health. “MHG should increase the proportion of organically reared fish relative to its total production volume significantly, not least because there is corresponding demand on the buyer side,” suggests Duy Ton. The company’s fish farms in Norway largely follow sustainable practices, but in Chile there are MHG aquacultures that still require significant improvement. These farms continue to use antibiotics, for example. Part of the issue here is, of course, that Chile’s coastal waters are densely packed with fish farms. “If neighbouring farmers use antibiotics, there is little that MHG can do,” Duy Ton admits. “Nevertheless, we are urging them to stop. In addition, MHG should work towards making its fish feed even more sustainable and intensify its efforts to find viable alternatives.”

Dr. Philipp Kanstinger

In conversation with Dr Philipp Kanstinger, expert for seafood certification at WWF Germany

Union Investment wants to know more

Dr Kanstinger, why should investors pay attention to sustainability aspects in relation to fish farms?

If fish farms take sustainability concerns into account and develop their business accordingly, they gain three major competitive advantages. First of all, they will see a fall in their resource consumption and costs, because they will use less fish meal and new automated feeding systems are more fuel-efficient. Secondly, all fish farms – with the exception of recirculation systems, which make up less than 3 per cent of global production – depend on ecosystem services of the local environment (e.g. clean water, buffer capacity of the relevant body of water, etc.). The only way for companies to remain viable and successful in the long run therefore lies in the preservation of the ecosystem in which they operate, i.e. avoiding damage to their local environment through the discharge of waste water, excessive use of fertilisers or deforestation. And finally, environmental requirements in relation to fish farming have been tightened in nearly all fish-producing countries. Only companies that are already addressing this issue and gaining experience with sustainable practices can be sure that they will be able to retain their licence in future.

The WWF has played a key role in the foundation of the Aquaculture Stewardship Council (ASC), which has been a recognised eco-label for conventional fish farming since 2010. How many companies in the industry have been certified as compliant with this standard?

The WWF is one of many ASC stakeholders. 577 fish farms around the world have now been ASC-certified. That is equivalent to approximately 6 per cent of the total aquaculture production.

What measures is the WWF planning to take in order to encourage even more companies to get certified?

The WWF promotes ASC certification in three ways. We are supporting several pilot projects with small farmers in emerging markets. We have also developed quality control standards as part of our cyclical reviews of standards. And last but not least, we actively engage in informing and advising consumers and merchants. These three areas of activity all help generate momentum for ASC certification.

#International WWF Centre for Marine Protection

Through its International WWF Centre for Marine Protection in Hamburg, WWF Germany strives to support efforts to put at least 10 per cent of our oceans under permanent protection


“Companies need to do it right”

In the face of the challenge of having to supply fish to a growing global population whilst also reducing the level of overfishing in the oceans, the importance of fish farms cannot be overstated. We have reached a stage where the market can no longer cope without this additional source. But companies need to do it right. There are many little adjustments that companies can make to improve the sustainability of their business models and to do their bit for society and the environment in the process. A look at many of the aquacultures in Norway shows that it is perfectly possible to operate a competitive fish or seafood farming business based on sustainable practices. Environmental requirements in the country are very strict. The Norwegian authorities have introduced a traffic light system that flags up negative impacts on the environment and helps to manage approved capacities. Red means that there is a threat to the environment and that capacities need to be reduced. Amber is a neutral marker and a green light means everything is in order and production capacities can be increased. Companies with global operations such as MHG should use the insights gained in Norway and push for fish farming to be made more sustainable in other countries as well.

Duy Ton
Duy Ton

Portfolio Manager in the Sustainability and Engagement Team at Union Investment

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