AVAILABILITY OF FISHMEAL AND

FISH OIL AND IMPLICATIONS

FOR AQUACULTURE

C.J. SHEPHERD

MASS BALANCE OF MARINE

INGREDIENTS PRODUCTION 2010

IFFO estimates

Total 18,515

Whole Fish 13,886

By-Products 4,629

888 4,166

Water Steam 13,461

LANDED VOLUMES

(GREATER THAN

200K TONNES) OF

FISH SPECIES USED

FOR REDUCTION

(AVERAGE OF 2001-

2006) CLASSIFIED

BY THEIR DEGREE

OF ACCEPTABILITY

AS HUMAN FOOD

INDUSTRIAL GRADE FORAGE Landings tonnes

Gulf menhaden (Brevoortia patronus) 479,000

Atlantic menhaden (Brevoortia tyrannus) 212,000

Sand-eel (Ammodytes spp.) 486,500

Total 1,175,000 tonnes of which 100% converted

FOOD GRADE FORAGE

Peruvian anchovy (Engraulis ringens) 8,468,000

Japanese anchovy (Engraulis japonicus) 1,567,000

South African anchovy (Engraulis encrasicolus) 228,000

Sprat (Sprattus sprattus) 262,000

Blue whiting (Micromesistius poutassou) 678,500

Capelin (Mallotus villosus) 958,500

Total 12,162,000 tonnes of which an estimated 90% was converted

PRIME FOOD FISH

Atlantic herring (Clupea harengus) 656,500

European sardine (Sardina pilchardus) 639,000

Chilean jack mackerel (Trachurus murphyii) 1,870,000

Japanese jack mackerel (Trachurus japonicas) 320,000

Chub mackerel (Scomber japonicus) 1,403,500

Californian sardine (Sardina sagax caerulea) 556,000

South African sardine (Sardina sagax) 263,000

Total 5,708,000 tonnes (average landings 2001 – 2006) of which an unknown percentage

was converted after Wijkström, 2011

RAW MATERIAL FOR GLOBAL

MARINE INGREDIENTS PRODUCTION

2000-2010

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2000 2005 2010

Raw material sources for fishmeal

By-products

Whole wild fish

IFFO estimates

0

1000

2000

3000

4000

5000

6000

7000

8000

ton

ne

s ,0

00

Fishmeal

Fish Oil

GLOBAL FISHMEAL AND FISH OIL

PRODUCTION

1964-2010 (TONNES X 103)

IFFO data

El Niňo

IFFO data

FISHMEAL AND FISH

OIL PRODUCTION

SHOWS SLOW

DECLINE BUT

CONTINUES TO BE

DOMINATED BY

PRODUCTION IN

SOUTH AMERICA.

PRODUCTION IN

EUROPE HAS

CONTINUED TO

DECREASE

CHANGING USES OF FISHMEAL

1960 TO 2010

Aquaculture 73%

Chickens 5%

Pigs 20%

Others 2%

The estimated use of fishmeal by sector 2010

IFFO estimates

ESTIMATED USE OF FISHMEAL BY

SECTOR IN 2010

TREND IN WEEKLY PRICE RATIO OF

FISHMEAL TO SOYABEAN MEAL

1993 TO MARCH 2012

IFFO data

CHANGING USE OF FISH OIL FROM

HYDROGENATED FAT TO AQUACULTURE

AND DIRECT HUMAN CONSUMPTION

80%

20%

1960

Hardened Edible

Aquafeed

Industrial

Refined Edible

Changing uses of fish oil

Clockwise from the top

IFFO estimates

2%

71%

3%

24%

2010

59%16%

20%

5%

1990

FISH OIL USAGE (TONNES X 103)

2005-2011*

IFFO & GOED data * 2011 is an estimate

0

200

400

600

800

1,000

1,200

2005 2006 2007 2008 2009 2010 2011

Other uses

Crude Oil human consumption

Aquaculture

SOURCES OF REFINED OIL 2011

79.4%

6.8%

5.8% 3.0%

4.0% 0.4% 0.1% 0.0%

Anchovy/Sardine Cod Tuna Salmon Algae Krill Yeast Plant

Source GOED Note over 95% comes from fish

SOURCES OF REFINED OIL 2011

VOLUMES OF SALMON FEED ARE

INCREASING

0

500

1000

1500

2000

2500

3000 19

85

198

6

198

7

198

8

198

9

199

0

199

1

199

2

199

3

199

4

199

5

199

6

199

7

199

8

199

9

200

0

200

1

200

2

200

3

200

4

200

5

200

6

200

7

200

8

200

9

2010

2011

E

North America

UK

Chile

Norway

,000 tonnes

CHANGING COMPOSITION OF SALMON

FEEDS OVER TIME WITH SUBSTITUTION

OF FISHMEAL & FISH OIL

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

1995 2000 2005 2010

Fish meal Alternative proteins and starch Fish oil Vegetable oils

Fish oil

Alternative proteins and starch

Fish meal

N. Alsted pers. comm.

INCREASING AQUACULTURE DOES NOT USE

MORE MARINE INGREDIENTS

0.00

0.50

1.00

1.50

2.00

2.50

3.00

3.50

0.0

5.0

10.0

15.0

20.0

25.0

30.0

35.0

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Global Aquaculture Production with fishmeal and fish oil usage 2000-2010 tonnes millions

Fed Aquaculture

Fish meal in aquaculture

Fish Oil in aquaculture

Data FAO & IFFO

CHANGING EPA/DHA CONTENT IN

NORWEGIAN SALMON

2002-2012

2002 2012 % of total oil in salmon feed 35% 35%

% fish oil* in added dietary oil 100% 33%

% dietary fish oil contribution via fish oil within fishmeal 5% 1.5%

% fish oil in total diet 35% 12.6%

% EPA+DHA of dietary oil (if fish oil contains 20% EPA+DHA) 20% 7.2%

EPA+DHA in 140g portion of salmon fillet containing 15% oil ** 4200 mg 1512 mg

No. of days of EFSA requirement met by 1 portion (250 mg/day) 16.8 6.0

No. of days of UK/SCAN requirement met by 1 portion (450 mg/day) 9.3 3.4

No. of days of WHO requirement met by 1 portion (500 mg/day) 8.4 3.0

* Assumes fish oil mix of approx. 50% Peruvian anchovy and 50% North Atlantic sources * *Assumes EPA & DHA levels in salmon fillet are the same as the oil in the feed

SO BY 2017 WE NEED:

Approximately 400,000 tonnes of crude oil for refining for human consumption Approximately 400,000 tonnes for salmonid feed At least 200,000 tonnes for other aquaculture Fish oil production is predicted to remain at around 1 million tonnes Conclusion: we urgently need more sources of LC Omega 3

• Algae

• Krill

• Genetically Modified oil seeds

POSSIBLE SIGNIFICANT SOURCES

FOR 2015

• Two mains types of production: – Fermentation: investing companies include

DSM Martek and Lonza

– Sunlight: Aurora and Algae Biosciences

• A lot of development on the back of biofuel research e.g. Cellana in Hawaii

• Most still in the start up phase

ALGAE

• Ratio’s of EPA & DHA and concentrations vary from species to species and growing conditions

• Generally concentrations of LC Omega 3 in the oil are higher than in fish oil

• Using a 30% EPA/DHA equivalence production was around 5000 tonnes in 2011 and likely to be around 30,000 tonnes by 2017

ALGAE

• Antarctic krill biomass estimated to be 200 - 400 million tonnes

• Managed by CCAMLR who have set a TAC of 5 million tonnes with a trigger level of 620,000 tonnes

• Current catches only around 200,000 tonnes per annum

• Aker Biomarine have obtained MSC certification for their harvests

KRILL

• Aker Biomarine world’s largest harvester of Antarctic Krill

• They represent about 50% of current harvests

• High value but volumes are still small and oil yields low

• Growth is rapid but total volumes likely to be under 5000 tonnes of oil by 2017

KRILL

• There is no commercial production of plant based EPA & DHA production

• The two species closest to market are soy and rapeseed (canola)

GENETICALLY MODIFIED OIL

SEEDS

• Soymega from Monsanto with high SDA is expected to get regulatory approval in the US this year

• An EPA product is still a few years away and DHA is over the horizon

GM SOY WITH LONGER-CHAIN

OMEGA-3 IS CLOSE

• Dow AgroSciences & DSM are working on producing DHA in canola

• Cargill and BASF announced in November 2011 that they were working on producing EPA and DHA from canola

• A commercial product appears several years away

EPA & DHA FROM CANOLA ARE

BEING WORKED ON

Conclusion: There is no EPA & DHA from land plants available today. Unlikely to be significant volumes on the market in 2017. But the potential to increase rapidly once developed means that in ten years volumes could be considerable

• Continuing move to precautionary fishery management as well as to using fish for direct human consumption instead of fishmeal production

• Increasing trend towards use of certification by marine ingredients producers to reassure value chain on sustainability/responsible stock management

• At most a static supply of marine ingredients (~ 5 M tonnes pa fishmeal + 1 M tonnes pa fish oil) going forward but with an increasing proportion of fishery by-products

• Continuing switch to greater added value use (eg to aquaculture for fishmeal instead of agriculture; and direct human consumption products for fish oil)

• Increasing focus on micronutrients in fish raw materials to extend their availability and usefulness and create new added value products

• Continuing growth in demand for aquaculture feed, but accompanied by a continuing trend towards substitution of marine ingredients and to their use as strategic ingredients being restricted to critical stages in the life cycle

LIKELY TRENDS IN SUPPLY AND USE OF

FISHMEAL AND FISH OIL GOING

FORWARD

• Emergence of new sources of raw material - It is unlikely that LC omega-3 demand will be met by GM crop expression in next 5 years, but algal oil is already entering human nutrition & pharmaceuticals

• From 2000 to 2010 the FIFO ratio for fed aquaculture has fallen from 0.6:1 to 0.3:1 - even so-called ‘carnivorous’ fish will increasingly be commercially farmed to yield a net production of fish protein and oil

• It seems unlikely there is a ‘fishmeal trap’ meaning that aquaculture growth will not be limited by the availability of marine ingredients

• In other words there’s enough fishmeal for aquaculture going forward but fish oil could become limiting, pending availability of new sources

• Increasing fish oil demand for direct human consumption will mean reduced availability for aquaculture resulting in lower LC omega-3 levels in aquaculture products – but also in higher omega-6 levels

• Increasing differentiation of salmon products by retailers is likely and failure to meet international recommendations may become an issue

• Taking a global view, there are still areas for improvement, especially the use of low value/trash fish fed raw to aquaculture in S E Asia

LIKELY TRENDS IN SUPPLY AND

USE (CONTD.)

THANK YOU

DRCJSHEPHERD@AOL.COM