Aquaculture Value Chain

Finfish Aquaculture Value Chain

This document proposes a ‘straw man’ finfish aquaculture value system. Its purpose is to act as the focus for discussion and refinement.

The value chain highlights each major component of the finfish aquaculture industry. The components determine how value is created by the industry. By identifying each of these value system components and understanding their role, we can be sure that we have a structured framework for identifying which innovation investments are most likely to create the best Return on Innovation Investment (ROII).

Framework Structure

Figure 1: Finfish Aquaculture Value System



Each of the value system components to the diagram are described in more detail below. As identified in Figure 1, The Value System is an end to end representation of the Finfish Aquaculture Industry from egg to consumption by end users and includes ten components:

• Siting
• Licensing, regulation and compliance
• Raising juvenile fish (genetics, spawning, fingerlings)
• Aquaculture growth environment including systems, monitoring control and remediation
• Inputs required to grow fish (clean water, feed, air/oxygen, probiotics, supplements, treatments/drugs)
• Logistics (harvest, process, package, labeling, storage, transport, tracking)
• Value added food products
• Market
• End users
• Addressing environmental and social challenges associated with the industry
• Maximising the aesthetics of the product

The intent of the Value System is to provide a comprehensive structured approach to thinking about each of the value chain elements that should be addressed by a world class finfish aquaculture enterprise. Each of these Framework Elements will be considered during the Innovation Roadmapping Process to identify the ones that are likely to make the greatest contribution to the ability to produce elite quality finfish at industrial scale.

Value Systems and Networks

The value chain, is a concept from business management that was first described and popularised by Michael Porter in his 1985 best-seller, Competitive Advantage.
A value chain is a chain of activities. Products pass all activities of the chain in order and at each activity the product gains some value.

The concept has been extended beyond individual organisations. It can apply to whole supply chains and distribution networks. The delivery of a mix of products and services to the end customer will mobilise different economic factors, each managing its own value chain. The industry wide synchronised interactions of those local value chains create an extended value chain, sometimes global in extent, called a value system. A value system includes the value chains of a firm’s supplier (and their suppliers etc), the firm itself, the firm distribution channels, and the firm’s buyers.

The importance of this concept for the Finfish project is that by understanding the value chain that is relevant to the production and marketing of industrial quantities of elite quality table fish in the future will allow us to gain a feel for the types of innovation that is likely to create a sustainable competitive advantage for our future finfish companies.

The concept of a Value Network is also useful to our work. Value networks are complex sets of social and technical resources. They work together via relationships to create economic value. This value takes the form of knowledge. Value networks exhibit interdependence. They account for the overall worth of products and services. Companies have both internal and external value networks. External facing networks include customers or recipients, intermediaries, stakeholders, complementors, open innovation networks and suppliers. Internal value networks focus on key activities, processes and relationships that cut across internal boundaries, such as order fulfillment, innovation, lead processing, or customer support. Value is created through exchange and the relationships between roles. Value network operate in public agencies, civil society, in the enterprise, institutional settings, and all forms of organization. Value networks advance innovation, wealth, social good and environmental well-being.

Value System/Network Components

Siting (biological, weather, physical conditions)
additional information will be added here
Licensing, regulation and compliance
additional information will be added here
Raising juvenile fish (genetics, spawning, fingerlings)
additional information will be added here
Aquaculture growth environment including systems, monitoring control and remediation
additional information will be added here
Inputs required to grow fish (clean water, feed, air/oxygen, probiotics, supplements, treatments/drugs)
additional information will be added here
Logistics (harvest, process, package, labeling, storage, transport, tracking)
additional information will be added here
Value added food products
additional information will be added here
Market
additional information will be added here
End users
additional information will be added here
Addressing environmental and social challenges associated with the industry
additional information will be added here
Maximising the aesthetics of the product
additional information will be added here

Addressing environmental and social challenges
Establish priorities for solution-oriented research and technological innovation that support economically viable aquaculture within an environmentally sustainable framework. This growing aquaculture industry is associated with a number of environmental and social challenges, including:

• Aquaculture at inappropriate sites can lead to habitat conversion and on-going operational impacts
• Aquaculture potentially has several adverse effects on wild species, including disease transmission, escape, and capture for brood stock or rearing among others
• Production of nutrient-loaded effluent can lead to eutrophication of nearby waters
• Prophylactic use of chemicals, including antibiotics can harm wildlife and the environment, and may lead to antibiotic resistance
• Massive water use can result in water shortages as well as salt water intrusion and other hydrological changes or waste disposal issues
• Reliance on high protein, fishmeal-based feed for carnivorous species often requires many kilos of wild fish to produce one kilo of edible aquaculture product
• The conflict over the use and conversion of natural resources as well as access to remaining resources and the privatization of public commons has resulted in physical conflict and even murder in some countries
• Inflation in the cost of key local goods (e.g. food, labor, land or other inputs) disproportionately affects those not associated with the industry, particularly the poor
• The decline in fisheries in some areas is due to direct environmental impacts of aquaculture or its indirect impacts on the market price of local catch.

Maximising the Aesthetics

• Nutrition
• Health
• Taste
• Aroma
• Texture/Mouth feel
• Appearance
• Colour
• others

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