Rising Tide of Aquaculture

By Joseph L. Murphy

There is a rising tide of aquaculture in farm country, and Iowa farmers have the opportunity to increase their profitability while leading the way in seafood production.

Salmon, tilapia, shrimp and other aquatic species are finding a home in Iowa and farmers that typically raise soybeans, corn and livestock are finding a niche in new business opportunities. Jackson Kimle, the vice president of business development for Inland Sea, is one example of a young farmer and businessperson that is jumping into the world of aquaculture. Inland Sea is an Iowa business set to build a state-of-the-art salmon aquaculture system near Harlan.

“Iowa is an advantageous location for salmon production for a variety of reasons,” Kimle says. “The major input for salmon, like any animal protein, is feed and clean water. Iowa is one of the lowest cost feed ingredient locations in the world.”

The executive team at Inland Sea is hard at work acquiring financial investors to build the aquaculture facility. The current design allows for two large state-of-the-art one-acre tanks. When it is completed the $29 million Inland Sea facility will produce approximately 5.3 million pounds of salmon annually.

Kimle and others at Inland Sea believe that salmon offer a significant opportunity because of its broad market appeal and supply constraints in both wild-catch and seaside aquaculture. “There is a global need to increase and shift salmon production to scalable, sustainable methods,” he says.

Shrimp

J&J Drydock Shrimp in Forest City is filling a niche with their farm-raised saltwater Pacific White Shrimp. Jeff & Julie Tegland with the support of a growing group of shrimp and aquaculture growers started raising the shellfish in a renovated outbuilding on their acreage. The couple says they had a learning curve in starting the business, but learning from trade groups and friends have made their new business payoff.

“I love shrimp, and agriculture in Iowa has always interested me,” Julie Tegland says. “We toured several farms, and I became the driving force for us to get started. All of the local shrimpers attend the Shrimp Academy (in Ridgeway) to get information and learn from speakers. I have fun with it.” The Teglands raise their shrimp using a partial soy diet and sell the shrimp locally, allowing the consumers the opportunity to purchase fresh seafood directly from them.

“Our business has grown through word of mouth, and we have a waiting list of people wanting shrimp. We have found that people want shrimp for Christmas, New Year’s Eve, Valentines and even through the summer grilling season,” she says.

J&J Drydock currently has three grow out tanks housing about 2,000 to 3,000 shrimp per tank. They also have a nursery tank and are fully permitted by the Iowa Department of Natural Resources (DNR). They receive the shrimp at 12 days old and grow them to market weight, about 25–30 in a pound, within five months.

“Right now we are maxed out on tanks in this facility,” Tegland says. “Our hope is to expand to a raceway system. So we will need to find another building or build a new facility on our farm.”

An attractive choice for some in the industry has been renovating old commercial business properties and even former school houses into aquaculture farms.

Networking and help

Brian Waddingham with the Coalition to Support Iowa Farmers (CSIF) receives calls on a weekly basis from farmers that are interested in testing the waters of aquaculture production.

“We’ve seen a lot of interest from potential aquaculturists that are looking for a niche market,” Waddingham says. “Between the Inland Sea project and VeroBlue farms, there are some opportunities. Aquaculture is a way for farmers to diversify and grow, especially at a time when commodity prices are low, and land costs are still relatively high.”

CSIF held an aquaculture conference in November to provide farmers information about Iowa’s newest livestock industry. The event included a broad range of relevant topics for farmers to consider such as opportunities in aquaculture, the role of cooperatives, rules and regulations for fish farms, permits needed to buy and sell fish and shrimp, how to develop a business plan for the farm and how to structure the business.

“We took a close look at forming cooperatives during the aquaculture conference. The limiting factor right now for many is being able to purchase in volume,” Waddingham says. “Like any new startup livestock business, you have to have a market, and you have to have a price point to be competitive. There are some exciting things happening with aquaculture in Iowa because the demand is there.”

Waddingham says that there is a lot of homework to get started with an aquaculture business. And that is why they brought together experts in the industry to help those interested in starting.

Bill Lynch, a yellow perch farmer from Ohio, was the keynote speaker at the CSIF aquaculture conference. Lynch is a believer in cooperative systems to pool resources. He also offered advice to prospective growers.

“One of the things I have been trying to advocate for is the formation of aquaculture cooperatives around major urban centers,” Lynch says. “If you have 40 or 50 farmers involved then you can buy in bulk. Maybe the cooperative has a processor involved in it combined with a person that is hired to market the fish.”

He went on to say that the market is there for aquaculture, but farmers need to discover those niches and work together to build an economy of scale.

“The first thing people need to do is educate themselves about aquaculture,” he says. “They need to develop a business plan, and they need to think about where they want to go (with the business) and choose the right species.”

For Lynch, pond aquaculture filled with yellow perch has been a high-end niche market for him. He is profitable, but is quick to say that it depends on your definition of profitability.

“I have five acres of water, and you can’t raise a family of four on five acres of water,” Lynch says. “But we have no car or truck loans and the boys’ education is paid for. So it is icing on the cake when you can find niche markets in aquaculture.”