Fisheries Committee on Nov. 24th, 2011

[Ryan Cleary, NDP, St. John's South—Mount Pearl, NL]

Thank you again, Mr. Chair.

Mr. Holder, you mentioned that you began your career in Bay d'Espoir, which is my neck of the woods in Newfoundland, and you've always worked in closed containment aquaculture. I heard you say that, right?

[John Holder]

I did start my career there. I had already been in the business for 12 years. I went there in 1985. I was the manager of the hatchery. I designed it and ran it for three years. But I haven't worked in the net-pen field.

[Ryan Cleary, NDP, St. John's South—Mount Pearl, NL]

Here's my question. For an area like Bay d'Espoir, which has an open-pen industry that employs a fair number of people in Bay d'Espoir, what kinds of opportunities are there for your technology and for this closed containment aquaculture? What kind of opportunities are there for a rural area like Bay d'Espoir, which already has an open-pen industry?

[John Holder]

Well, unfortunately, with Bay d'Espoir, they're doing Atlantic salmon, and the margins aren't as high on Atlantic salmon as they are with coho. The one advantage I can see for Bay d'Espoir is that we would have a controlled environment. I've designed closed containment farms for Bay d'Espoir for farmers in the past, but they just couldn't get the capital to do it, and the difference in market price wasn't warranted.

[Ryan Cleary, NDP, St. John's South—Mount Pearl, NL]

I have one quick question. You mentioned a 100-mile diet. I'm sorry, but I haven't heard that before. Can you expand. What does that mean?

[John Holder]

Maybe that's a B.C. thing. People now are starting to say that we have to eat things that are produced within 100 miles of ourselves to cut down our carbon footprint. It's a movement. I'm not sure if it started in B.C., but it gets a lot of press where I am.

For these rural farms, transport and energy are going to be big things in the future. If we can have our food produced within 100 miles of a major city, you're going to save a lot of money in freight and of course the freshness of the product.

[The Chair, Conservative, Rodney Weston]

Thank you very much, Mr. Cleary.

Mr. Allen.

[Mike Allen, Conservative, Tobique—Mactaquac, NB]

Thank you very much, Mr. Chair.

Mr. Holder, thank you very much for being here.

I have a few clarification questions. On the technology that you've actually developed for coho, can you give us a brief comparison? How does that compare to the 'Namgis facility? Are you aware of that facility and the technology they're using? How does yours compare with that?

[John Holder]

Yes. Actually, I was the first consultant who designed the 'Namgis facility. I designed three different biofilter systems: the fluidized sand bed, the moving bed bioreactor, and the microbead filter.

The cheapest was the microbead filter. But unfortunately with the 'Namgis, politics got into it, and Tides Canada and Save Our Salmon and whatever are funded by fairly large organizations like the Gordon and Betty Moore Foundation, and Tides Canada has gone into partnership with the Freshwater Institute so they decided to use their technology.

The difference is that they were going to use the fluidized sand bed and now they're going to do the microbead biofilter. Their project is going to produce a little over 300 tonnes a year for $7 million. I'm going to produce 1,000 tonnes for $8.5 million. I'm going to use half the power. So I just have to shake my head.

[Mike Allen, Conservative, Tobique—Mactaquac, NB]

Thank you.

[John Holder]

When politics gets into it, it's bad.

[Mike Allen, Conservative, Tobique—Mactaquac, NB]

I guess that's why we don't want to get government money in it, too.

I have a question on the Montana facility. You told Mr. Kamp you had a two-acre facility in Montana, a covered facility of 160 tonnes. How large a building do you have to cover that? How big is that footprint?

[John Holder]

It's 100 feet wide and 250 feet long. Fifty feet of that is the processing plant, so basically the plant went into a hundred by two hundred feet--half an acre.

[Mike Allen, Conservative, Tobique—Mactaquac, NB]

Would that be scalable up to larger sizes or would you have to build on new modules?

[John Holder]

Every farm is different. That was designed for 160 tonnes. So to scale it up, they could build another facility right beside it or from scratch and they could do 500 tonnes or 1,000 tonnes. We would have a slightly different layout, but it's totally scalable. I can do 10 tonnes, 50 tonnes, or 10,000 tonnes.

[Mike Allen, Conservative, Tobique—Mactaquac, NB]

Can you quickly go back...? You mentioned the differences between the coho and the Atlantic salmon, with the Atlantic salmon being a commodity product and also having a higher cost. You indicated $1.97 a pound for the coho, and I can see this on one of your slides. What did you say the Atlantic salmon was? You didn't see a situation where you could get it under $2.50 a pound...is that what you were saying?

[John Holder]

No. It sells for around $2.50 a pound at the lowest market value. I think the cost was around $2.17 a pound, so it's pretty close. There are specialty markets where you may get a premium price for the Atlantics, but right now it would be hard to do, I think, because a dollar is a dollar and most people will not spend that premium. But for the coho market, for Whole Foods, Wild Oats, whatever, that type of grocer will spend the extra money for the coho.

[Mike Allen, Conservative, Tobique—Mactaquac, NB]

Okay. You've taken me to the competitive market, then. That's one of the things I've always wondered about. If we were to bring the Atlantic salmon into closed pen and look at that cost factor, it appears to me that for a lot of the other countries we're competing against, if they don't do the same thing, we're going to be out of that commodity market.... Does coho have a special market niche so that you don't see that competition from other countries?

[John Holder]

Chile does coho, but they're thousands of miles away from the market.

Go back to the 100-mile diet. We can set up close to the markets, which is going to cut down our transport cost. We're not producing 100,000 tonnes. In B.C., we're only producing possibly 10,000 tonnes. In Japan, there's interest in building 10,000-tonne farms. In China, three or four people are interested in doing 10,000-tonne farms.

In B.C. we do 80,000 tonnes, so we're not trying to out-compete the Atlantic market. We're trying to find another market for coho, which is a very good fish.

[Mike Allen, Conservative, Tobique—Mactaquac, NB]

Do you see--

[John Holder]

So yes, it's going to be hard if we legislate our net pens on land.

[Mike Allen, Conservative, Tobique—Mactaquac, NB]

Do you see any issues with moving this into less rural areas and closer to populations? Do you see a situation where...? Are there going to be extra waste water treatment loads with the facility when you do that or do you see that as being a problem?

[John Holder]

No, I don't see it as a problem, because the technology is there now such that we can handle that waste. Waste is money as well. There are different streams we can use: fertilizers, composting, and constructed wetlands.

Now, that 75,000 square feet or two acres did not include the hydroponic section or constructive wetland. The constructive wetland would be another half acre. But all that water would go back to ground, so we don't need sewage treatment plants or landfill facilities to take the waste. The feces can be composted and used as garden fertilizers or in silviculture. The guts, the offal, can be rendered down for pet foods and for mink food. There is also money in waste. The CO₂ from the fish can be sequestered into the hydroponics--algae growth.

And we can control all this. This is the nice thing about it. With net pens, you can't control it.

[Mike Allen, Conservative, Tobique—Mactaquac, NB]

Thank you, Mr. Holder.

[The Chair, Conservative, Rodney Weston]

Thank you very much.

Mr. MacAulay.