Western Australia scraps planned yellowtail nursery after agreement with Huon Aquaculture falls through

The state government of Western Australia has reportedly canceled its plan to build an AUD 10 million (USD 6.6 million, EUR 6.1 million) yellowtail kingfish nursery in Geraldton, with the government claiming a lack of commitment from Huon Aquaculture. 

The hatchery, first announced by the state government in 2019, was originally planned to support Tasmania-based Huon Aquaculture’s efforts to build new farms in the region, the Australian Broadcasting Corporation reported. The government decided to build the facility itself after rejecting two separate proposals from private firms.

Now, however, the Australian Broadcasting Corporation is reporting plans for the hatchery have been scrapped after Huon Aquaculture failed to make a commitment to expanding in Geraldton. 

'Without that project, we don't really have any demand for a finfish nursery," Western Australia Fisheries Minister Don Punch told the media. "They haven't told us that they are definitely not coming, but they have not provided any information at all, despite requests that they are going to proceed with that at this point, so we will be talking with them about the future of the lease."

The plan for the nursery was developed after Western Australia created the Mid West Aquaculture Development Zone in 2017. Located in an area of open water between Geraldton and the southern region of the Abrolhos Islands, the zone was intended to provide “investment-ready” platforms for large-scale aquaculture, the West Australia Department of Primary Industries and Regional Development said. 

“The government has done all the work upfront to ensure that projects in the zone have an environmental seal of approval,” the department said. The work meant that potential aquaculture companies would avoid lengthy approval processes and save money.

Despite that additional work by the government, the region hasn’t seen the development of yellowtail kingfish aquaculture it expected.

A farmer that did operate there, Indian Ocean Fresh Australia (IOFA), announced in a September 2020 press release that it was “pausing” its production. It halted restocking its pens due to Covid-19 disruptions in its supply chains. 

“We are basically ‘skipping this crop’ to assess how things are going to look in a year’s time,” IOFA Owner and Managing Director Erica Starling said at the time.

But IOFA still hasn't resumed production, and in 2021 the Australian Broadcasting Corporation reported the company “lost faith” in the state government. The company culled its broodstock after learning the state government was planning a land-based aquaculture project with a different company for the region – a proposal the company learned about by accident.

Starling told the media she “realized that all the work we've been doing is basically going to help those that come after us.”

Without IOFA, and with no communication from Huon – which was bought by São Paulo, Brazil-based JBS, the world’s largest meat-processing company, in 2021 – there’s no reason to build the nursery, Punch said.

"There is no point in building a nursery when there is not an offtake agreement for the product," Punch said. "It would just sit there not doing anything and [it would be] a different conversation about why we have a white elephant."  

Photo courtesy of the West Australia Department of Primary Industries and Regional Development