VeroBlue Farms demise adds to the scepticism around the financial viability and environmental sustainability of land-based fish farm operations.
By Fabian Dawson
A Canadian-owned land based fish farm in Iowa has gone belly-up with over US$100 million in debt, adding to the litany of failed businesses that try to grow fish on land.
VeroBlue Farms (VBF), which had recirculating aquaculture system (RAS) facilities near Webster City in Hamilton County, owes $98,943,246.22 in unsecured debt to its top 20 creditors and another $6 million in secured debt, according to its bankruptcy petition.
The company also owes US$279,000 in property taxes, an undisclosed sum to the Internal Revenue Service and has unpaid utility bills.
Last year it announced that its aim is to become North America’s biggest land-based fish farm and the largest domestic producer of barramundi, raising as much as 10 million pounds every year.
In a separate civil lawsuit, five of VeroBlue’s top management are accused of misappropriation of funds. The suit, filed in federal court, claims Leslie A. Wulf, Bruce A. Hall, James Rea, John E. (Ted) Rea, and Keith Driver “wasted VBF assets.”, according to messengernews.net
VeroBlue Farms Inc. with a corporate address in Toronto and whose directors are listed as being from Calgary took over the operations in 2014, after the area’s biggest employer, Electrolux, left town.
VeroBlue’s demise adds to the scepticism around the financial viability and environmental sustainability of land-based fish farm operations.
While the cost of RAS systems has come down, Canada’s Department of Fisheries and Oceans in a 2010 study, calculated the capital cost of open-net aquaculture at $5 million, with a 52% return on investment in the third year, compared with $22.6 million for an RAS, with a return on investment of 4%.
Studies also show that to move Canada’s current salmon production to land based systems would require 28,000 Canadian football fields and 4.16 billion litres of fresh water to fill the tanks.
Land based farms also compensate for the lack of a natural environment (i.e., flow, temperature and oxygen) by pumping water, heating/cooling water, and injecting oxygen – requiring consistent and significant amounts of energy and have a higher contribution to CO2 emissions.
Currently, the carbon footprint of raising fish in oceans is far lower than other farmed produce. For salmon it is 2.9 per kilogram, while chicken is 3.4, pork is 5.9, and beef a staggering 30.