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  1. Characteristics, structure and resources of the sector
    1. Summary
    2. History and general overview
    3. Human resources
    4. Farming systems distribution and characteristics
    5. Cultured species
    6. Practices/systems of culture
  2. Sector performance
    1. Production
    2. Market and trade
    3. Contribution to the economy
  3. Promotion and management of the sector
    1. The institutional framework
    2. The governing regulations
    3. Applied research, education and training
  1. Trends, issues and development
    1. References
      1. Bibliography
      2. Related links
    Characteristics, structure and resources of the sector
    Summary
    In the past 30 years aquaculture in New Zealand has grown from very small beginnings to a significant economic activity, utilizing over 5 500 hectares of sea space and producing annual sales of around US$ 230 million in 2006 (Lynch and Berger, 2003, NZGovt, 2007).The industry has achieved an average annual growth rate of 13 percent by total sales earnings over the 20 years to 2005 (NZGovt, 2007). Aquaculture contributes around 20 percent of the value of the country’s total seafood production, and is an important export industry with around 66 percent of all aquaculture production exported (NZGovt, 2007).

    There are three main aquaculture species in New Zealand that together contribute more than 90 percent of total aquaculture production by value or by volume (NZGovt, 2007; NZAC, 2005).

    In the past five years a strong New Zealand dollar combined with government restraints on the availability of new sea space for aquaculture has dramatically slowed the previous rapid growth of this industry (Lynch and Berger, 2003). In 2006 the New Zealand aquaculture industry developed an industry-wide growth strategy aimed at achieving annual production of US$ 720 million by 2025 (NZAC, 2006). In 2007 the New Zealand government responded to the industry-wide strategy by offering to provide some more support to the developing aquaculture industry (NZGovt, 2007).
    History and general overview
    The indigenous inhabitants of New Zealand, the Maori, are reported to have undertaken rudimentary aquaculture activities, such as the placement of suitable rocks into the intertidal settlement zone of oyster larvae (Jeffs, 2003). They were also thought to have transplanted abalone and other shellfish between areas in an effort to enhance localized production of coastal seafood which was of major dietary significance for the pre-European Maori population (Best,1986).

    Commercial scale aquaculture in New Zealand begun in the 1960’s with assistance from the government to establish the intertidal farming of a native rock oyster, (Saccostrea commercialis ), in shallow harbours in the north of the North Island (Crimp, 2007). Pacific oysters (Crassostrea gigas ) later became the dominant cultivated oyster in New Zealand after they were introduced into the country in the early 1970s. Farmers switched their farms to the Pacific oyster because it grew much faster than the native rock oyster, and subsequently the activity spread to many more locations in the North Island.

    The aquaculture of New Zealand mussel began in the late 1960s following the collapse of two dredge fisheries close to where the mussels are farmed today – the Hauraki Gulf in the North Island, and the Marlborough Sounds in the South Island (Dawber, 2004; Jeffs et al., 1999). Production increased rapidly as farming techniques developed and bulk handling methods were introduced to the industry in order to meet growing demand for export to more than 60 countries.

    The aquaculture of king or chinook salmon developed in the 1980s from fishintroduced from Sacramento, California in the late 1890s for initiating a sport fishery in New Zealand (Jeffs, 2003). The New Zealand industry has since grown into one of the largest producers of farmed king salmon in the world (FAO, 2007).

    Attempts at enhancing wild scallop (Pecten novaezelandiae ) fisheries in waters at the top of the South Island begun in 1982 following the decline of the wild fishery (Booth and Cox, 2003). Today, large numbers of seed scallops are caught in plastic mesh bundles moored in areas of high natural scallop settlement. These are then used to re-seed natural scallop beds which are later commercially harvested on a rotational basis. This re-seeding has resulted in a marked increase and stabilizing of the available annual catch. Prior to the introduction of the enhancement programme the average annual catch in this fishery was around 2 400 tonnes greenweight. However, through the development and application of re-seeding techniques the fishery has doubled its annual production.

    There is small-scale production of giant river prawns (Macrobrachium rosenbergii ) only made possible by the use of geothermally heated groundwater. In the last decade there have been numerous attempts at farming native species of abalone, however, production levels remain low, mostly of the species rainbow abalone (Haliotis iris ).
    Human resources
    It has been estimated that in 2005 the New Zealand aquaculture industry was providing direct employment for 2 500 full time equivalents, with most of these in the processing sector (Lynch and Berger, 2003; NZAC, 2005). Studies suggest that economic flow-on effects from aquaculture tend to generate indirect employment on an equivalent basis to direct employment, mostly in providing business and property services, as well as manufacturing, trades and transportation (Jeffs, 2003). Currently, the aquaculture industry is particularly important for regional and coastal areas of New Zealand, many of which are characterized by limited employment opportunities (Lynch and Berger, 2003). This source of rural employment is particularly important for a number of Maori communities which have strong traditional associations with their coastal settlements. Should the industry achieve its growth target of US$ 720 million of annual sales by 2025 it is expected that the industry workforce will rise by an additional 7 000 full time equivalents.

    Skills levels in the New Zealand aquaculture industry have improved substantially in recent years, greatly helping to improve productivity (Lynch and Berger, 2003). This has been largely due to the efforts of the Seafood Industry Training Organization (SITO) in implementing tailored aquaculture training programmes based on its prior success with industry-based training for the wild-fisheries catching sector (Lynch and Berger, 2003, SITO, 2007).
    Farming systems distribution and characteristics
    In 2004 there were 645 New Zealand mussel farms occupying a total of 4 747 hectares of water space and producing over 85 000 tonnes of mussels (NZAC, 2005). The majority of these farms were in the Marlborough Sounds at the northern end of the South Island. A smaller proportion of the mussel farms are located in the Coromandel and Hauraki Gulf in the north of the North Island, and a smaller number again at Stewart Island. More recently, permission has been given to develop farming in some larger offshore areas in the Bay of Plenty and Hawkes Bay off the eastern coast of the North Island.

    There were 23 king salmon farms in 2004 occupying 60 hectares of water space and producing 7 400 tonnes of fish (NZAC, 2005). Most of these farms were located in marine waters in the Marlborough Sounds, and Stewart Island, but also a smaller number in freshwater in hydroelectric water channels.

    In 2004 there were 230 oyster farms covering 750 hectares of marine waters mostly in a series of sheltered harbours on the north-eastern coast of the North Island (NZAC, 2005). These farms produced around 3 300 tonnes of oysters.

    A further 35 abalone farms operated over 20 hectares of marine water space producing only 2 tonnes of product in 2004 (NZAC, 2005). Most of these farms were located in the Marlborough Sounds or on Banks Peninsula on the eastern coast of the South Island.
    Cultured species
    The New Zealand aquaculture industry is focused on the production of three main species, an endemic mussel (known as Greenshell ), the New Zealand mussel (Perna canaliculus ), king salmon (Oncorhynchus tshawytscha ), and Pacific oysters (Crassostrea gigas ) (NZGovt, 2007). Other aquaculture species are in the early stages of commercial development or are only in production on a small-scale. These include indigenous yellowtail kingfish, abalone, groper, as well as Malaysian prawns grown in geothermally heated water (Jeffs, 2003; NZGovt, 2007).

    In 2005 New Zealand mussel made up 64 percent of the value of New Zealand’s three main aquaculture species with total sales of US$ 150 million (NZGovt, 2007). A further 27 percent of the value of aquaculture production from the three main species came from king salmon (US$ 63 million), and 9 percent from Pacific oysters (US$ 20 million).

    Only relatively small quantities of other species were cultured, including abalone, abalone pearls, kingfish, grass carp, and native freshwater lobsters, with an overall total of less than US$3 million of production (NZAC, 2005). The culture of ornamental species, mostly cold water species such as goldfish, was estimated to be valued at over US$ 15 million.
    Practices/systems of culture
    New Zealand mussel are cultured from wild seed gathered on collecting ropes in areas of high larval mussel settlement, and from drift seaweed encrusted with seed mussels (Jeffs et al., 1999). There are a small number of experimental hatcheries, however, they have difficulty competing with the relatively low cost of gathering wild seed. A government and industry sponsored research and development programme on selective breeding in New Zealand mussel has been undertaken for the past five years, but is yet to make any significant impact on production in the species. New Zealand mussel are grown on a modified Japanese longline system usually in shallow coastal waters of 15 to 30 metres depth. Some groups are currently experimenting with methods for farming this species in more exposed offshore waters.

    The New Zealand King Salmon Company Ltd, dominates the production of king salmon in New Zealand. The company has a very well developed selective breeding programme which is well integrated with its quality control and production systems. Other salmon producers rely on stock from hatcheries where there is less well developed, or no selective breeding of stock. The majority of fish are grown out in marine sea cages in coastal waters, with a small proportion grown out in freshwater – mostly in canals build for channeling river water for hydroelectricity production. There is a small amount of feed production in New Zealand, however, the bulk of the feed supplies are imported directly from manufacturers in Australia.

    Pacific oysters are mostly cultured from wild seed, the majority of which are gathered in the Kaipara Harbour on the north-western coast of the North Island. A small number of commercial hatcheries are in operation, including one which offers selectively broodstock. However, oyster farmers have been reluctant to adopt hatchery-reared seed, mostly because the seed can not be used in the traditional rack culture system which is preferred by the majority of the industry. There is increasing use of alternative grow-out systems, including plastic trays and the hanging longline system developed in Australia.
    Sector performance
    Production
    The graph below shows total aquaculture production in New Zealand according to FAO statistics:
     

    Reported aquaculture production in New Zealand (from 1950)
    (FAO Fishery Statistic)

    (Source: FAO Fishery Statistics, Aquaculture production)

    Market and trade
    In 2005 domestic sales of aquacultured New Zealand mussel were US$ 30 million, king salmon US$ 40 and Pacific oysters US$ 9 (NZGovt, 2007). Exports were US$ 120 million for New Zealand mussel, US$ 23 million for king salmon, and US$ 12 million for Pacific oysters.

    New Zealand mussel are exported widely, but the USA remains the largest single export market buying US$ 43 million in 2005, followed by Spain, Australia, South Korea and the U.K. (NZGovt, 2007). New Zealand mussel are mostly processed to a frozen half-shell product which is packed into either small retail, or larger food-service packs. New Zealand was a pioneer of the frozen-half shell mussel product and now accounts for 75 percent of world production of this mussels in this format (Seafood International, 2007).

    Farmed king salmon was mostly exported to Japan US$ 11 million in 2005, followed by Australia and USA (NZGovt, 2007). This salmon is sold in a broad variety of product forms, including value-added products, such as smoked slice,s fish kebabs, and nibbles.

    The single largest export destination for Pacific oysters from New Zealand in 2005 was Australia (US$ 5 million), followed by Japan and the USA (NZGovt, 2007). These markets were mostly supplied with fresh or frozen half-shell oysters.

    New Zealand operates very rigorous human health monitoring programmes for aquaculture production, especially for shellfish. In particular, in 1980 New Zealand signed a memorandum of understanding was signed between the United States Food and Drug Administration (USFDA) to provide quality assurance on exports of bivalves to the United States (NZFSA, 2007). As a consequence, New Zealand now requires that aquaculture bivalves are transported, processed and labelled in accordance with the USFDA National Shellfish Sanitation Programme (NSSP).

    New Zealand’s largest processor and supplier of New Zealand mussel was one of the first producers in the world to be organically certified. The mussels were certified by a respected New Zealand certifying agency, Bio-Gro. A number of oyster farms have also now been certified as organic producers, as well as a king salmon farm.
    Contribution to the economy
    Aquaculture is a relatively small industry by New Zealand standards, but is important in the economy because of the high level of employment and economic activity it generates in some key rural regions. Furthermore, the industry has shown strong sustained growth over the past 30 years, making it one of the fastest growing rural industries in New Zealand. The industry is also important because of its strong exporting profile in a country which has struggled to greatly increase its foreign exchange earnings.
    Promotion and management of the sector
    The institutional framework
    There is no single government agency responsible for aquaculture administration in New Zealand. Likewise, aquaculture interests are not represented in any specific Ministerial portfolio in government (NZGovt, 2007). For example, a government strategy on aquaculture released in 2007 was endorsed by six government ministers with the following portfolios, environment, Maori affairs, conservation, fisheries, local government, industry and regional development. In addition, five government departments were directly involved in the preparation of the strategy. Furthermore, the access to marine and freshwater aquaculture sites are controlled by a series of 17 regional local government agencies with further oversight by a number of central government agencies.

    The legislative framework under which regional government allocates marine space for aquaculture was overhauled and new legislation for planning for aquaculture put in place in early 2005. Prior to this there had been a ban for over three years on granting any new aquaculture space while the legislation was developed. As of mid-2007 no new farm space had been allocated under the new laws due to slow progress in implementing the new legislation. The government has invested heavily in attempting to put the new laws into operation, through forming a group of government officials drawn from the various departments involved in aquaculture administration. More recently the government has begun offering cash grants to further attempt to move the new legislation forward.

    Land-based aquaculture is managed under separate laws which are outdated in terms of modern aquaculture practice (NZMAF, 2000). For example, New Zealand is probably the only country in the world where the farming of trout is illegal despite commercial interest in doing so, especially from companies already farming other salmonids.

    In June 2007 the New Zealand government released an aquaculture development strategy which highlights some existing actions and proposes some new initiatives and funding around five key objectives for aquaculture (NZGov, 2007):
    • Building greater investor confidence.
    • Improving public support.
    • Promoting Maori success.
    • Capitalising on research and innovation.
    • Increasing market revenues.
    In early 2007 the aquaculture industry formed New Zealand Aquaculture Council Ltd from a mix of several existing regional and species aquaculture industry groups (NZAC, 2006). The aim of the Council is to implement a national strategic development plan that was developed in 2006, one of the goals of which is to work more closely with government to attempt ensure it has a more positive influence over the future of the industry.
    The governing regulations
    In 2004, New Zealand passed the Aquaculture Reform Act , which amended several existing acts and created two new acts. The Aquaculture Reform Act amended the:
    • Resource Management Amendment Act of 2004 ;
    • Fisheries Amendment Act of 2004 ;
    • Conservation Amendment Act of 2004 ;
    • Biosecurity Amendment Act of 2004 ;
    • Te Ture Whenua Māori Amendment Act of 2004 ;
    and created the:
    • Māori Commercial Aquaculture Claims Settlement Act 2004 ; and
    • Aquaculture Reform (Repeals and Transitional Provisions) Act 2004.
    The primary ministries involved in the management of aquaculture are the Department of Conservation and the Ministry for the Environment for coastal marine aquaculture, and the Ministry of Fisheries (MFish) for freshwater aquaculture. The Ministry of Agriculture and Forestry, and agencies under its mandate, regulates food standards and safety for all animal products and materials, including fish feed and fish products. In addition, the Ministry of Māori Affairs has an interest in some part of New Zealand's broad aquaculture regulatory system, although its role is not as prominent as the other ministries.

    The Resource Management Act of 1991 (RMA) , as amended, provides much of the framework for managing aquaculture in New Zealand. Under the RMA, the Minister of Conservation is responsible for preparing New Zealand coastal policy statements, approving regional coastal plans and permits for restricted coastal activities, and additional monitoring activities. The Ministry for the Environment's duties include making recommendations on issues for national policy statements, setting national environmental standards, and issuing water conservation orders. The Ministry also investigates the use of levies, fiscal measures, and incentives, and other economic instruments, that may be applied under the Act.

    The MFish keeps a national registry of fish farmers, and manages and advises regional and territorial authorities on management of fisheries resources. Freshwater, under the statutory guidance of the Fisheries Act of 1983, as amended. Pursuant to the Fisheries Act of 1996 , the National Fisheries Advisory Council can advise the Minister on a variety of topics, including sustainability of use of fisheries resources for aquaculture purposes.
    Direct management of aquaculture occurs at the regional and territorial level through regional coastal plans. These plans define zones within which aquaculture is permissible, set limits on the aquaculture activities and related industry activities, and specify limits on the character, intensity, or scale of activities, inter alia . The Ministry for the Environment has the authority to issue a national policy statement to guide the regional and territorial policy makers in developing policy initiatives.

    For more information on aquaculture legislation in New Zealand please click on the following link:
    National Aquaculture Legislation Overview - New Zealand
    Applied research, education and training
    The main government agency for funding aquaculture research in New Zealand is the Foundation for Research, Science and Technology (FRST). It is involved in prescribing in some detail how it will direct its research funding after some consultation with end users. Overall government investment in aquaculture research is estimated to be around 2 percent of the gross annual value of production and industry investment estimated to be on a similar level. Most government funding for aquaculture research is delivered through a competitive bidding process.

    The largest aquaculture research organization in New Zealand is the National Institute of Water and Atmospheric Research Ltd (NIWA), which is structured as a profit-making private company which is wholly owned by the government. NIWA operates three aquaculture research facilities; Bream Bay Aquaculture Park in Northland (saltwater), Mahanga Bay aquaculture facility near Wellington (saltwater), and Silverstream Hatchery near Christchurch (freshwater). The Bream Bay Aquaculture Park is based around an industrial-technology park concept, and includes a number of private aquaculture companies operating on the same site. NIWA also produces commercial quantities of yellowtail kingfish for sale to on-growers from this site. In a similar manner, NIWA also produces seed abalone from its Mahanga Bay site, and salmon smolts from the Silverstream Hatchery. The second largest aquaculture research group is the Cawthron Institute, which is a non-profit regional research entity based in Nelson at the top of the South Island. It operates a saltwater research facility nearby, called Glenhaven Aquaculture Centre Ltd, which also has some private aquaculture companies operating on-site. Only a very small amount of aquaculture research is undertaken in the tertiary education sector in New Zeland.

    Only one university in New Zealand offers an undergraduate degree specializing in aquaculture, the Auckland University of Technology. Other tertiary training centres offering aquaculture courses include Bay of Plenty Polytechnic, Mahurangi Technical Institute, and the Nelson Marlborough Institute of Technology.

    The Seafood Industry Training Organization (SITO) operates as an integral part of the seafood industry in New Zealand to provide nationally recognized training programmes for building an innovative workforce (SITO, 2007). SITO has developed aquaculture training programmes based on the needs of companies involved in this sector.
    Trends, issues and development
    During 2006 the New Zealand aquaculture industry went through a major strategic planning exercise which resulted in, The New Zealand Aquaculture Strategy (NZAC, 2006). Through the planning exercise the industry set itself an overall growth target of US$ 720 million of annual sales by 2025. The strategy sets out ten areas of activity needed to facilitate achieving this growth target.

    Establish a new national sector organization.
    At the end of 2006 the New Zealand Aquaculture Council Ltd was established as the peak body representing all aquaculture industry interests in the country, by uniting the fragmented operation of the smaller species and regional industry respresentative bodies. A chief executive officer has been appointed to lead the work of the new Council and to implement the growth strategy.

    Strengthen the partnership with government.
    Central and local government aspirations for aquaculture have remained unclear for many years. The intent is for the industry to work with government to provide greater clarity and support for their intentions for growing a vibrant aquaculture industry.

    Strengthen other stakeholder partnerships.
    Existing regional and species aquaculture industry representative bodies, as well as other groups, such as seafood industry, research providers and tertiary sector are to be encouraged to play a key role in advancing aquaculture by aligning their support with the interests of the industry.

    Secure and promote investment in aquaculture.
    Investment in aquaculture is critical to generating growth in this industry. However, establishing greater certainty and security for investors, particularly around sea space tenure, is required if the industry is to attract more investment.

    Improve public understanding and support for aquaculture.
    Greater public understanding and support for aquaculture is critical to achieving growth for the industry, particularly for accessing new sea space for aquaculture.

    Promote Maori success in aquaculture.
    Maori are major stakeholders in the aquaculture industry in New Zealand, however, their commercial and technical capabilities are variable, and in many instances will need some guidance and support to realize their full potential. A number of existing examples show that aquaculture can deliver economic and social benefits to rural Maori communities.

    Develop the market for New Zealand aquaculture products.
    Diversification in products and markets will be critical to better safeguard and grow New Zealand’s aquaculture sector.

    Maximise opportunities for innovation.
    Growth of the New Zealand aquaculture industry to date has been based to a large extent of high levels of innovation. Continuing to foster the innovative environment will be critical to achieving further growth.

    Promote environmental sustainability and integrity of aquaculture.
    New Zealand has a strong environmental ethos, in part due to traditional Maori beliefs about natural resources. Naturally high quality coastal waters have enabled the aquaculture industry to thrive and reliably produce superior products without major constraints from pollution hazards. Therefore, ensuring the continuation of environmentally sustainable growth of aquaculture will be critical to the future of the industry.

    Invest in training, education and workforce promotion.
    A proactive approach to maintaining and up-skilling the workforce in the aquaculture sector will help to ensure it has the human capability to continue to grow.

    To implement this ambitious industry development strategy the New Zealand Aquaculture Council has introduced a levy on existing aquaculture producers. In addition, the New Zealand government has offered to contribute additional funding, with a particular focus on attempting to improve the operation of the regulatory regime for aquaculture introduced in 2005.

    In June 2007 the New Zealand government released a statement of commitment to support the aquaculture industry in New Zealand (NZGovt, 2007). The statement has five key objectives (outlined previously), and five guiding principles, with a further 15 sub-principles. The strategy includes US$ 1.4 million of further funds to be directed at attempting to put into operation the new aquaculture legislation introduced in 2005.
    References
    Bibliography
    Best, E.1986 . Fishing methods and devices of the Maori. Government Printer, Wellington, New Zealand.
    Booth, J. and Cox, O. 2003 . Marine fisheries enhancement in New Zealand: our perspective. New Zealand Journal of Marine and Freshwater Research 37: 673-690.
    Crimp, D. 2007 . Out of the blue – aquaculture. New Zealand Geographic. 84: 98-112.
    Dawber, C. 2004 . Lines in the water; a history of Greenshell mussel farming in New Zealand. River Press, Picton, New Zealand.
    Jeffs, A.G. 2002 . The importance of a helping hand; the growth of aquaculture in Australia and New Zealand. Report to the Winston Churchill Memorial Trust, Wellington, New Zealand.
    Jeffs, A.G. 2003 . Assessment of the potential for aquaculture development in Northland. NIWA Report #AKL2003-012, Auckland, New Zealand. (http://www.enterprisenorthland.co.nz/downloads/aqua_dev.pdf).
    Jeffs, A.G., Holland, R.C., Hooker, S.H., Hayden, B.J. 1999 . Overview and bibliography on the greenshell mussel, Perna canaliculus, from New Zealand waters Journal of Shellfish Research 18:347-360.
    Lynch, C. and Berger, N. 2003 . Aquaculture: a growing and innovative industry. LECG, Wellington, New Zealand.
    NZAC - New Zealand Aquaculture Council2005 . Annual Report 2004-2005 – The New Zealand Aquaculture Council Incorporated. (http://the6322s2.handel.2day.com/doclibrary/industryorgs/nzac/NZACAnnualReport2004-2005.pdf).
    NZAC - New Zealand Aquaculture Council2006 .The New Zealand Aquaculture Strategy. (http://www.aquaculture.org.nz/pdfs/NZ_Aquaculture_Strategy.pdf).
    NZGovt - New Zealand Government2007 . Our blue horizon: He pae kikorangi; the government’s commitment to aquaculture. (http://www.aquaculture.govt.nz/files/pdfs/MED_Aquaculture_doc.pdf).
    NZSMAF. 2000 . Join the discussion. Ministry of Fisheries, New Zealand. (http://govdocs.aquake.org/cgi/reprint/2004/628/6280100.pdf)
    Seafood International. 2007 . Supplies and markets – mussels. June 2007. pp.16-17.
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