InvestSA

Aquaculture

Overview

Aquaculture is the fastest growing food production sector in the world, at an annual rate of increase of 8% to 10% a year for the past two decades and contributing half of global fisheries products. In South Africa, however, aquaculture is an underdeveloped sector, contributing a small fraction to the country’s GDP. The sector is divided into marine and freshwater farming. Marine aquaculture is capital and technology intensive and is seen as a source of high-value fishery products for export. Freshwater aquaculture is mainly viewed as a potential source of food security for rural communities in coastal areas.

Value proposition

Nascent it may be, but aquaculture in South Africa holds enormous potential as a sustainable form of food protein, given global and local demand. Traditional fishing alone will not meet increasing demand for fish, and aquaculture can help reduce pressure on wild fish stocks. Because of its demonstrable potential, the government has, under its Operation Phakisa, targeted aquaculture as a key growth area. Hence moves are being made to streamline regulation to overcome an uncoordinated legal framework and overregulation, and introduce initiatives to fund support, increase the skills pool, raise awareness and improve access to markets, among other things.

Opportunities

The main opportunities have been in the Western Cape, the outstanding province in the number of fish farms and production, with an estimated turnover of R400 million and strong growth prospects. Abalone farms which export to China are the reason for the Western Cape dominance. South Africa supplies an estimated 21% of the global market for farmed abalone.

The abalone farms are an example of marine aquaculture, which contributes more than half the volume but almost all the value of aquaculture production, with the focus on high-value species such as abalone, seaweed, mussels and oysters. With the introduction of finfish (as opposed to shellfish) farming, mariculture production is expected to increase substantially.

Freshwater fish farming has not thrived, with demand and price low for all but trout, but this should change thanks to industry and government interventions. The market for tilapia is especially promising, with exports to the rest of Africa more than tripling in value to R11 million from 2015 to 2016.