magazine for sustainable sourcing and market intelligence48 bangladeshsourcing update13 added water to frozen shrimp25 will digital disruptionﬁnally hit the global shrimp industry?high prices for large sizes#3 September 2018innovating the shrimp industry: a broad perspective Powered by©2018 Stichting Seafood Trade Intelligence Portal (STIP). ShrimpTails is an STIP (www.seafood-tip.com) publication and has four issues per year.25 September 2018disclaimerLimitation of liability: STIP is not responsible for any errors in or accuracy and availability of the infor-mation provided through ShrimpTails magazine or its Platform. The information provided through ShrimpTails magazine or its Platform is for informational purposes only and not intended to serve as the sole source of information for User to make a business, trading or investment decision. 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In no event shall the liability of STIP exceed the fees paid in the twelve months preceding the event causing damages.Editor-in-Chief Willem van der Pijl / STIP (NL)Editorial Assistant Sander Visch / STIP (NL) Editors Annette van Tits, Jo Hamilton-Bilijam, Josanne Blokker & Ursula Beer / Editors Collective Amsterdam (NL)Contributors Jasmijn Venneman / STIP (NL), Adeyemi Ademiluyi / STIP (NL), Christos Rallis / STIP (NL), Nikki den Boon / STIP (NL), Alban Caratis / Fresh Studio (VN), Lida Soeda Pet / Hatﬁeld International (ID), John van Herwijnen / Open Europe (ES), Moin Uddin Ahmed/ Solidaridad (BD), Liris Maduningtyas / Jala (ID), Mazhab Uddin / Consultant (BD), Shameem Ahmed / Solidaridad (BD) & Aquaconnect (IN)Graphic & Illustrative design Marnix de Klerk & Nina Mathijssen / Detour (NL)Website support Mathijs van de Venne / Everweb (NL)Support Bram Verkerke / Solidaridad (NL)Photo credits Cover photo, p. 26 by This FishAdvertising and sales Jasmijn Venneman / STIP firstname.lastname@example.org t +31 6 40 81 33 61 silver membersShrimpTails and Seafood Trade Intelligence Portal are powered by Solidaridad Network. contents05 editorial 60 southern europe62 online b2b platforms in the seafood industriesfailure or success?06 brighter days waves of optimism on redesigning shrimp aquaculture10 introduction to sourcing updates42 smart tech sensorstransforming the Indonesian industry45 tracing shrimp with blockchain51 buying directly from the sourcerisks and rewards58“a shrimp story”Thai Union drives ﬁrst ASIC shrimp into the US market67shrimp farmingclose to the market72the geography of innovation53 from ﬂy to vannameiﬂy larvae as new high-protein source74new wave foodsalgae-based shrimp18 machine vs manual peeling of warmwater shrimpa future for Asia?25 will digital disruption ﬁnally hit the global shrimp industry?27 geneticssilently pushing the shrimp sector forward35 growing out of the old, diving into the newthe future of precision farming 56 introduction to market updates22 vietnam64 north-western europe70 united states32 india48 bangladesh40 indonesia16 ecuador13 added water to frozen shrimpand EU labelling regulationcolumnsourcing updatesmarket updatesin-depth tailsinterviews04shrimptails | editorialIndonesian farmer using sensors.Photo by JALA 05shrimptails | editorialAs we ﬁnalize this edition of ShrimpTails, I realize once more that you – in the shrimp industry – are dealing with such an intense dynamic that whatever we have written is outdated before you have even read it. Nevertheless, with this third edition, we provide you with another must-read analysis of the global supply and market situation, whether to give you new insight, conﬁrm what you’ve already noticed or shed light on pressing matters.As this quarter wraps up, let’s take a moment to reﬂect on the bumpy ride that we’ve just had, and which continue into the next quarter. In July and August, farm gate prices were driven up by competition among exporters for the remaining harvests. It was not until the end of August that prices had recovered to such a level that farmers were motivated to take on production again. The fact that farmers in Vietnam and India have stocked late, at lower densities, or not at all, is expected to contrib-ute to a global shortage of Paciﬁc white shrimp from September until early November. By mid-November, however, India’s second harvest will come to the market. As US retailers will have made their purchases by then, it remains to be seen which players on the market will jump in. If by that time supply is higher than demand, global shrimp prices may be disrupted once more. As many have said in recent months, low shrimp prices may be the new reality for the industry. The only way forward in this new reality is through innovation. Innovation to make production more eﬃcient (e.g. by improving farm and feed management), to better monitor pond conditions (e.g. by using sensors) and to meet consumer demands regarding sustainability (e.g. by replacing ﬁshmeal with insect meal) and traceability (e.g. by digitalizing processes in shrimp factories). With a great network of innovators around the world, the shrimp industry should brace itself for the exciting, and perhaps bumpy, ride ahead. Let ShrimpTails inspire you about the thrilling times to come.Willem van der PijlDirector Seafood Trade Intelligence Portaleditorial 06shrimptails | brighter daysbrighter days waves of optimism on redesigning shrimp aquaculture07shrimptails | brighter daystom prins, dealflow manager at impact investment fund aqua-spark, shares his story, giving us an insight into all the amazing innovations which could disrupt the shrimp industry he comes across in his daily life.According to the Food and Agri-culture Organisation, feeding a world of 9.1 billion people in 2050 will require 70% more food. But our oceans, of which two thirds of the world depends on for proteins, are being depleted. Aquaculture is the way forward. It’s the fastest growing food system on the planet and, in order to feed a growing world population, we will need to triple the output of the industry. But we need to get it right. I am optimistic about the future of sea-food, but it’s crucial that we im-prove practices and transform the industry towards healthier, more aﬀordable, and more environmen-tally responsible production.Since late 2015, I ﬁnd myself looking for solutions that make the aquaculture industry more eﬃcient. As dealﬂow manager I am part of the investment team at Aqua-Spark, a global investment fund focused on investments in sustainable aquaculture. We make investments in SMEs across the value chain, in companies that will transform the industry into a more sustainable one while bring-ing returns comparable to today’s traditional industry. In this posi-tion, I am constantly surrounded by the future of aquaculture and the people at the forefront of change.I am motivated to shine a big bright light on what’s possible – on the opportunities that are all around us to make a controver-sial industry more sustainable. Because yes, it is controversial. There are major challenges the industry will need to solve. But what fascinates me, what inspires me, is that there are practical and often viable solutions for all these challenges. We are living in a day and age where we have the tools to completely redesign the way we produce our food. Including shrimp. Today, I share with you my observations on digitalization in the industry, shrimp health, nutrition and new production sys-tems, and what I think that means for tomorrow’s shrimp farming. digitalization A major challenge for shrimp farmers today is a lack of farm data and, as a result, poor farm man-agement. Operators’ key decisions are often made with a blindfold on, leading to major losses every year. There still is a signiﬁcant tech-nology gap in aquaculture, partic-ularly in shrimp farming. Many processes are still very manual, such as record keeping of water quality parameters, sampling and the visual inspection of animals. A general lack of aﬀordable tech-nology has historically kept many farmers from moving towards precision aquaculture and making better decisions.The good news is that combined these challenges make for the per-fect innovation cocktail ready to be served – from the larger indus-try players launching cloud-based analytics platforms to support farm-wide decision making, to disruptive start-ups developing Internet of Things (IoT) devices that can solve speciﬁc on-the-ground challenges such as improv-ing feeding practices. One of our portfolio companies is using com-puter vision and machine learning to count and characterize small aquatic organisms. In the case of shrimp, this provides us with Year founded 2014Founders Mike Velings and Amy NovogratzAssets under management roughly $75m Mission A world where everyone has access to healthier, aﬀordable, and environmentally responsible ﬁsh through aquaculture. Scale Aqua-Spark invests in scaling sustainable aquaculture and build-ing an ecosystem of 60-80 compa-nies across the value chain, as well as across species and geographies. Shrimp-related investments Xpert-sea, Calysta and eFishery, amongst others. Through HATCH also Aqua-Connect and Jala, amongst others.We are living in a day and age Where We have the tools to completely redesign the Way We produce our food”08exceptionally accurate informa-tion throughout the larval stages that can be used to optimize how we feed and grow shrimp, even beyond those early stages.From my position at Aqua-Spark and being a part of some of these developments, but also as an ob-server of these developments, I see that we are on the verge of com-pletely revolutionizing the way farm operations are being run and farm decisions are being made.Interestingly, it turns out that a wide variety of groups are looking to attend the party. New players that were historically not bothered with shrimp farming are starting to pay attention – investors, tech-nology developers and companies that have traditionally focussed on other species, such as salmon or even terrestrial animals. By driving value and reducing risk, I see this increased diversity in the industry as a crucial part of the innovation equation. The increased produc-tivity that has taken place over the past decades in more mature agriculture sectors will be repli-cated in aquaculture and will be sped up by enhancing diversity and innovation.shrimp health To me, shrimp health is a category ready for complete disruption. Be-cause shrimp lack an adaptive im-mune system it has been virtually impossible to make them immune to certain diseases by vaccination, as with other farmed species. This has led to wide usage of antibiotics across shrimp producers globally in order to ﬁght oﬀ pathogens. Un-fortunately, as increasing demands continue to put pressure on farms to produce more and at higher stocking densities, more stress is put on the system, making it more vulnerable to disease outbreaks. We see plenty of companies look-ing to completely redesign shrimp production from a health manage-ment perspective. This, I believe, is fuelled by synthetic biology as a rapidly growing domain due to the strong reduction in the cost of DNA sequencing and synthesising as well as improved bio-engineer-ing techniques. It’s a promising ﬁeld that will bring revolutionary solutions to the industry – such as the oral delivery of RNAi technol-ogies to silence or knock-down key genes of speciﬁc viruses (like the white spot syndrome virus), or the usage of bacteriophages as a natural alternative to antibiotics in taking down bacterial diseases such as Early Mortality Syndrome (EMS).nutrition From an impact perspective, one of the key issues that Aqua-Spark has been looking to solve is the industry’s de-pendency on ﬁshmeal. We strive for an aquaculture industry that’s non-reliant on natural marine resources. Looking at sheer vol-ume, the vast majority of ﬁshmeal consumed in the aquaculture industry is used in shrimp pro-duction, which is a major environ-shrimptails | brighter daysWe are on the verge of completely revolution- izing the Way farm operations are being run”mental burden. It is, therefore, exhilarating to see some ﬁshmeal alternatives being commercial-ized. Aqua-Spark is also involved in some of these initiatives: last year the results of trials using the Single Cell Protein (SCP) meal of one of our portfolio companies were present-ed. Shrimp that was fed a diet that included the SCP meal had similar or higher survival and growth rates compared to shrimp fed a standard ﬁshmeal-based diet. We’ve also seen very promising results in replacing ﬁshmeal with insect meal, with better growth performance whilst decreasing feed conversion ratios (FCRs). It will only be a matter of years before sustainable alternatives to ﬁshmeal in shrimp feed will be the new standard of the industry. From innovative ways of formu-lating larval feeds, to new nutri-tionally dense micro-algae strains, to functional ingredients such as essential amino acids and immu-nostimulants – exciting advance-ments are being made throughout the entire feed spectrum, plenty of them providing interesting invest-ment opportunities. production systems An interesting development happening on the production site – albeit still on a very small scale – is to move production closer to the market. Asia and Latin America are brought close to or even into North American and European metropolitan areas through fully controlled indoor systems. Pro-ducing shrimp indoors, in a closed and a recirculating aquaculture system (RAS) environment, allows for better water and waste man-agement and is less exposed to outside pathogens. Whilst it cer-tainly decreases the risks involved in farming shrimp as well as the environmental footprint, there still seems to be a long way before this form of production is compet-itive to more traditional produc-tion systems elsewhere, as capital requirements and operational costs are still high. the future of a fast-moving industry As transformative innovations continue to spur the shrimp indus-try, I get more entrenched in what’s possible. It also makes me prouder every day to be a part of this fast- moving, self-renewing and innovat-ing industry. I hope that in the not too distant future, shrimp produc-tion can provide stable livelihoods for many, and many more, with major advancements in farm man-agement tools and health solutions with a steep reduction in risks for farmers. This should open the door for every producer – includ-ing smallholder farmers – to full biomass insurance at low to reason-able premiums, and it will form the base of farm-level data to increase transparency levels throughout the supply chain. I fully believe the future of shrimp farming is bright and that major changes are about to happen. I can’t wait to witness it all and be a part of it.09shrimptails | brighter daysWe’ve also seen very promising results in replacing fishmeal With insect meal”Next >
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