Learning from failure
How one farmer’s 20-20 vision could help the emerging tilapia industry in East Africa
A ‘home market’ that is 3,000km away presents problems!”
GAVIN Johnston had a background in abalone farming in South Africa when he decided to start an offshore marine farm in Mozambique producing dusky kob. He set up his venture in 2012 with a Scottish salmon company as a partner (later revealed to Fish Farmer as Loch Duart) and to be sold into South Africa.
Johnston, now running Aquaculture Consulting and Management Services, told the large crowd of mainly African delegates that his project closed in 2014, after six years in operation, with $5 million losses.
Why? Although kob is a good species, and juvenile production was reliable, broodstock were secured, and growth and mortality were within targets, the South African market price had been over estimated.
Africa) that is 3,000km away presents problems!
Exports to the EU – the other target market – were disallowed at control.The political situation in Mozambique, for instance, was unstable and, as it turned out, would get more volatile.
‘The potential in East Africa is unparalleled in the world but you need to be bigger than a small abalone farmer and a small Scottish salmon
With 20-20 vision, Johnston explained what he, and his business partner Willem Schoonbee, should have done to make their venture a success.
Trying to establish a vertically integrated operation added ‘immense minimum viable scale. Furthermore, a poor understanding of a foreign For example, just when the market was deemed ready, the Mozambique government decided ice had to be EC approved, and that set things back by three months.
Businesses should negotiate a deal prior to investment to include long term rights and commercial terms; and they should be aware of high level political Now Johnston and Schoonbee have embarked on a new venture, assisting in the farming of tilapia on Lake Victoria. They are optimistic because tilapia is simpler to farm than a marine species and requires simpler feed ingredients.
The market is for the whole product, which in the absence of good processing facilities makes it more viable, and the market has existing knowledge and demand for the species.
They hope to be producing 200,000 tonnes by 2030, although Johnston recognises that new areas necessitate deep pockets.
‘We believe that it is of prime importance that future failures of large projects are avoided so that the industry can develop and