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Nothing fishy about the global aquaculture industry’s performance
Overfishing across the world’s oceans is becoming an increasingly serious problem, causing fish stocks around the globe to become depleted. Furthermore, fishing fleets are estimated to be two to three times larger than is necessary, causing further unsustainability in fish stocks. Fishing rights disputes have also become increasingly common; as a result aquaculture is becoming increasingly important as a solution to sustainability in the fish industry.
This is reflected in the global aquaculture industry’s growth of 5.4% in 2013, to reach a value of $121 billion (with almost 60 million tonnes of farmed fish produced), representing a compound annual growth rate (CAGR) of 7.9% for the period spanning 2009-2013.
The industry is dominated by the Asia-Pacific region which was responsible for almost 80% of the total value of global sales. This was fuelled by China which was responsible for almost 70% of revenues in the Asia-Pacific region during 2013. China’s appetite for seafood is in part because of its dynamic economy and growing middle class, but also due to seafood being a traditional part of South East Asia’s diet.
Another surprising bright spot in the aquaculture industry is the European market which demonstrated a CAGR of 7.4% for the 2009-2013 period, fuelled by Norway which was responsible for almost half of Europe’s revenues.
As the aquaculture industry continues to grow and develop, it is likely to consolidate under large vertically integrated global companies such as Norway’s Marine Harvest and Canada’s Cooke Aquaculture. There are niche operators such as the US’ Blue Ridge Aquaculture which is the world’s largest indoor tilapia producer, or Egypt’s Wadi Group which operates fish farms in the desert.
As it currently stands, the industry is highly fragmented with a significant number of players in each market. As the focus inevitably turns to aquaculture in the wake of increasing difficulties with fisheries, companies in a position to consolidate their assets will turn to acquiring the smaller companies that show the most promise. In the meantime, the number and diversity of aquaculture companies will remain high for some time.
For more information, click here for MarketLine’s Aquaculture Profiles