Every Christmas Eve – before the pandemic struck – Australians would descend on big city seafood markets in their tens of thousands buying up salmon, prawns and almost every type of edible fish traders had to offer.

The traditional roast turkey dinner, once so beloved of 1950s British migrants, disappeared long ago in a country that swelters under temperatures of 35O°C or more in December.

What most of those fish addicts probably didn’t realise is that almost half of what they bought over the festive period was farmed.

Yes, Australia is a major player in aquaculture, although most of what it produces stays at home. And it is now poised for huge growth according to recent studies..

It is not just a recent development. Australia’s indigenous people have been cultivating eels and crayfish for centuries.

Because the country is so far away and so vast, we in the northern hemisphere tend to overlook it as a producer, but the recent takeover battle involving the Tasmanian salmon farmer Huon brought its importance sharply into focus.

The growth of Australian aquaculture has been driven largely by increased production of salmonids and a declining trend in wild-caught production.

More recently the aquaculture sector has been broadening the composition of species produced – with increased emphasis on prawns, abalone, oysters and finfish varieties including barramundi and kingfish.

However, the effects of Covid-19 have brought a temporary setback. During the past 18 months tough restrictions on movement mean Australians have almost been prisoners in their own homes and the pandemic has led to the first annual contraction in aquaculture for 60 years.

Plans for growth

Aquaculture now accounts for more than 45% of seafood production. According to a recent report by broadcaster ABC, Australians consume 350,000 tonnes of seafood a year – or 15kg (33lbs) for every man, woman and child.

The industry was worth AUS $1.4bn in 2018 and its most popular products were salmon, tuna, oysters and prawns. Now the federal government wants to double that figure over the next six years although given the continuing presence of Covid that might be a little ambitious.

According to the Australian Bureau of Agricultural and Resource Economics and Science (ABARES), fisheries and aquaculture is forecast to recover slowly but steadily at 1.6% average annual growth to $3.21bn over the next four years.

Compared with the previous ABARES forecast in early 2020, this estimate represents a cumulative reduction in Gross Value Product (GVP) of $1.9bn over the period 2020/21 to 2024/25. That means about two-thirds of a year of GVP value will have been lost over the five-year projection period due to the range of external shocks impacting the sector between 2019 and 2020. ABARES says the forward projection for the industry is uncertain in the medium term because of unknowns regarding global economic growth.

Much of the farmed fish produced in Australia is eaten by Australians. The ABARES report says exports of salmonids have traditionally been low because most production has been targeted at the domestic market.

However, higher production volumes, rising global demand and greater market diversification are all expected to contribute towards increased exports over the forecast period.

In the year up to the pandemic in early 2020 salmonid exports were the highest on record (up over 60% in volume and value terms compared with 2018/19), despite a reduction in international freight due to global COVID-19 travel restrictions. This increase has been attributed to a notable increase in production, a decline in domestic demand from the food services sector and diversification into various export markets. Prices should also start to rise in the next year or two.

Much of the focus by farming companies will be on exports, with Japan and Southeast Asia the main targets. However, British consumers can also expect to see Australian salmon in the shops following the new trade deal with the UK.

Deteriorating relations between Canberra and Beijing over Australia’s decision to build nuclear submarines, among other issues, means China can probably be ruled out, at least in the medium term.

Australian exports of salmonids have traditionally been low because most production has been targeted at the domestic market. Despite this, in the 12 months before Covid struck (2019/20) salmonid exports were the highest on record (up over 60% in volume and value terms compared with 2018/19).

ABARES says higher production volumes, rising global demand and greater market diversification are all expected to contribute towards increased exports over the forecast period.

Tasmania leads the way

Australia’s two largest fish farming states are Tasmania (salmon) South Australia (tuna) , with Queensland and New South Wales (prawns) coming up on the rails. The federal and Tasmanian governments recently agreed to work together on a framework that could see the development of offshore aquaculture in the state.

Project Sea Dragon, a plan by the Seafarms group to build the world’s largest prawn farm in the Northern Territory, is expected to progress despite setbacks as a result of Covid. The project has been hailed by government leaders as a game-changing booster for the Territory’s ailing economy.

As in most other parts of the world, aquaculture down under has its critics. Broadcaster ABC says there are mixed views on sustainability, especially following the publication of Toxic, a book by acclaimed author Richard Flanagan, which argues that salmon farming is not as clean or green as claimed by the industry, but is in fact environmentally damaging.

Billionaire and mining magnate Andrew Forrest opposed the takeover of Huon by Brazilian meat processing giant JBS on environmental grounds.

The arguments will probably intensify, but it will not stop millions of Australians heading for the fish markets on Christmas Eve.

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