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Courtesy of UnderCurrentNews.com:

After managing to withstand a period of rising oil prices that forced many other fish farms in California’s Coachella Valley to shut down operations, New Global Energy subsidiary Aqua Farming Tech (AFT) is now planning to ramp up its tilpia production and expand into two abandoned farms in the valley next year.

According to Dave Knight, AFT director, Coachella Valley tilapia farming was a robust industry in the 1990s, but many farmers were forced out between 2006 and 2009, when faced with increasing fish feed and energy prices.

Knight said in 2016 the company will rescale production on its existing two farms —  the Thermal and Mecca farms which cover 120 acres — and is also plan on purchasing two other previously-functioning tilapia farms in the Coachella Valley.

“We are not producing much fish right now at all, for us we are only just now starting to scale our operations,” he said.

Prior to 2007, Knight said that the Thermal farm produced about 350 metric tons of fish per season.

The company’s Thermal farm, at full capacity, can produce 10,000 pounds a week, or 520,000 lbs a year. With its Mecca farm put into full production it will be able to produce another 10,000 lbs a week by the end of 2016, with an estimated 27,500 lbs a week in the first quarter of 2017 coming from  both farms.

The addition of a third, and possibly a fourth farm “will increase production further”.

Currently the company is producing fish using a new method that allows it to spawn at any time of the year rather than just in the spring, as most tilapia farms do, according to Knight.

“We have probably about a million fish right now in the early stages that will come to market next year,” he said.

In 2016, the company plans to scale up production on its farms and return to sizable production and solid profitability.

“And then we feel like the sky is the limit,” Knight said. “Now we have a solid plan in place and we are, in 2016, going to rescale production and and getting our farms to full capacity…and [we are] looking to do deals out in the Coachella Valley with farms that likely have been shut down but that will have all the costly sophisticated infrastructure in place to farm fish,” Knight said.

The company has not yet made any final purchases, but it plans to purchase and begin work on two farms in the area in 2016, once it has successfully scaled production back up on its existing two farms.

“Over the years we’ve looked at several [farms], right now I would say there are two farms in particular that we are interested in,” Knight said.

Knight said that his and other companies may benefit from falling prices in oil, but because of AFT’s efforts to decrease its susceptibility to oil price fluctuations that change makes little difference.

“For us it’s been a long four-year process…now the fact that oil price is low will probably help us that much more, but we’re positioned now to roll forward in a profitable manner, should it go up again, we’ll be able to maintain profit margin that we believe are really robust,” he said.

Oil price influence 

Prior to 2008, Knight estimated that there was about 150,000lbs of tilapia produced a week from the Coachella Valley, and production now has dropped to roughly 40,000 lbs/week.

“The rise in the price of oil really changed production cost metrics of…all of the companies out there,” Knight said. “All of the sudden their production costs were going up, [which] was not offset by a rise in the price of the product, and as a result many farms went out of business.”

Knight estimated that there were about three other farms in the area that were able to withstand the economic pressure and are still operating, but the others failed when they were unable to raise tilapia prices.

“What they found was that…the price of tilapia wasn’t elastic and consumers would trade out and buy…say, frozen fillets imported form Taiwan that were cheaper,” he said.

AFT responded to rising prices differently than most other farms in the Coachella Valley by doing what it could to take control of many input costs.

“What we did to get control over the electricity was we build solar panels that now provide 80-90% of our electricity…and we decided to manufacture our own feed,” he said.

AFT scaled down production completely and spent several years developing technology and methods to decrease the cost of energy and feed as well as decrease dependency on oil.

The farm took advantage of a California state initiative which offered incentives that allowed the company to construct two solar rays on each of its farms in order to gain control of the cost of electricity.

AFT also constructed its own fish feed mill so that it could manufacture its own feed, as well as other innovations to cut down costs.

For its larger fish, the company manufactures its own feed which includes moringa trees — native to Asia and Africa and widely-consumed in the Philippines where AFT’s founder, Rocky French, is from — that it grows itself.

The company also decided it would replace expensive feed for its sub-100 gram fish with algae, which saves the cost of feeding the fish in the beginning stages of their lives while also providing them with a nutrient-rich food source.

“This is a great, almost magical way to raise the fish,’ Knight said.

Moringa: the new superfood

The company is also interested in expanding its existing Moringa crop which it currently uses in its fish feed for its nutritional properties.

Moringa has been growing in popularity in the West due to its impressive health properties, including high levels of protein and various vitamins.

“It’s kind of a coincidence, only within the last year, it seems to me, that [moringa] has received any kind of attention in the West,” Knight said. “The leaves of the tree are remarkable, kind of a superfood.”

AFT plans to take advantage of the recent interest in moringa in the health and wellness sector to expand into a new market.

“Now all of the sudden we find ourselves with this emerging health and wellness market that is very interested in moringa.”

Knight said that the company will remain focused on tilapia production, but sees potential in the sale of moringa.

The company has eight acres planted so far, and plans to plant another 46 on its farms in the future.

Expanding tilapia to the mainstream

Knight said that thus far, his farm has been producing tilapia for live sale to ethnic Asian markets, but once the farms resume production he thinks the company will be able to “move on beyond that and deliver [its] tilapia to a mainstream American demographic that now is familiar with tilapia”.

According to Knight, tilapia has grown in popularity in the American mainstream market in the past four to five years.

“It seems like it came quickly into the American mainstream market quickly…and we believe that we can sell our fish into that market going forward with great results,” he said.