China set to make the most of krill

07 Jul 2015
Trawler fishing for krill in the South Antarctic

Trawler fishing for krill in the South Antarctic

Andrew Martin reports on China’s presence in the krill fishery and its plans for development.

Krill (Euphausia superba, Dana) is the largest fisheries biomass in the world and still relatively unexploited. However, China is developing a substantial government supported fishery for the tiny crustacean from which high value products can be manufactured. These include phospholipids enriched krill oil, the most valuable commercial krill product developed to date and which is prized as a health food supplement in western countries, but also increasingly in China itself. 

At present, Norway is leading the hunt for krill, although South Korea is very active in the fishery, as is Ukraine. Other countries such as Japan and Poland, which were fishing for krill, have pulled out. 

China has gradually been building its presence in the South Antarctic. Eight Chinese-flagged factory trawlers were registered with CCAMLR (Commission for the Conservation of Antarctic Marine Living Resources) which regulates fishing for krill in the Southern Ocean, for the 2014-2015 fishing season although not all of them might take part in the fishery.

Krill Project
China’s ‘Krill Project’ began in October 2010 when the Chinese State Ministry of Science officially launched its 863 Programme. In December 2010 a project team of nine universities and research institutions was set up and the project was formally approved in Dalian in March 2011.

The 863 Project is part of China’s Antarctic Ocean Living Resources Development strategy and is the country’s most important step to become, if not the most important, one of the key players in the Antarctic krill fishery. Named ‘Rapid Separation of Antarctic Krill and Key Technology of Deep Processing’, its target is the exploitation and utilisation of South Antarctic krill.

The project is expected to transform the Chinese offshore fishing industry and lead to the growth and development of the marine economy in Liaoning and Shandong provinces.

While Dalian in Liaoning Province is currently China’s krill fishery centre, Qingdao, a major port and fish processing centre in Shandong Province, aims to become the base for one of the world’s largest integrated Antarctic krill industries. Qingdao has led the development of China’s krill fishing and processing industry and by the time this project is complete, Qingdao port may create over RMB 6 billion of annual output value (about $1 billion).

The krill products to be manufactured in Qingdao will mostly consist of krill meal for various animal applications such as aqua-feeds, and there will be extraction facilities for krill oil for use as a human food ingredient and related human nutritional and health products such as meats, special proteins and peptides, etc.

The first Chinese krill fishery began in 2010 with Shanghai becoming one of the krill industry bases in China although mainly for export purposes. In 2011, Dalian Fishing Company and Shanghai Fisheries sent vessels to fish for krill in the Southern Ocean. 

“Dalian Fishing Company has the backing of the Chinese government through various types of subsidies both on land and at sea,” said Dimitri Sclabos, general manager of Chilean-based krill consultancy, Tharos Ltd. Tharos designed the business model and processing concept for some of the current Chinese government supported krill operators, privately owned krill processing companies, plus the Chinese Ministry of Fisheries. 

“So far Chinese at-sea operations have made good progress in deep-sea processing, and in the 2012-2013 krill fishing season produced around 2,000 tonnes of South Antarctic krill meat, dried krill meal and human-grade frozen minced krill, among other products.”

Extraction
Tharos, which has been advising on the utilisation of krill in the Southern Ocean for more than 25 years, has invented and developed an internationally patented revolutionary process for the at-sea extraction of phospholipids rich krill oil. 

Mr Sclabos is one of the inventors of the process and claims it to be highly cost efficient. “And our process is chemical free while all current processes used to extract phospholipids rich krill oil are done on land and use solvents.

“Several operators are working round the clock to come up with a solution that mimics Tharos’ solvent-free and highly cost efficient process,” said Mr Sclabos. “However, being a patent protected method, we bring a safe solution to operators currently discussing ways of collaboration with us.”

According to Mr Sclabos, Chinese onboard krill processing was an area lacking efficient and high-quality driven engineering solutions. “But new Chinese players have brought updated technologies and, most importantly, the drive to achieve efficient operations and the highest possible quality of end products.

“The final objective of those involved in the Chinese krill industry,” he added, “is to fulfil, firstly, the expected domestic demand of at last 3,000 tonnes of krill oil from 2015 to 2018. This demand is down to the demands of young middle class consumers who are concerned about their health and see krill oil as a novel alternative to accomplish this target.” 

Demand
Ten thousand tonnes of dried krill material for animal feed and human food applications complete the expected Chinese demand. 

“The Chinese market is so challenging that they needed to improve their normal poor working standards,” Mr Sclabos continued. “This is why we are involved, as the main target is products for human consumption, more specifically krill oil. The Chinese market is eagerly waiting for them but the goal is to cover the western market too.  

“Middle-high class Chinese demand is robust and demanding of high quality products. Our target is to accomplish a working standard comparable to any best fishing operation worldwide.” 

While not that many Chinese companies are involved in fishing and at-sea processing of krill, several have become involved in the marketing side of the value chain. “However, as yet, they cannot compete with the efficiency and quality of end products of krill processors from other countries,” Mr Sclabos said. 

While the total combined catch of krill in FAO statistical areas 48 and 58 of the South Antarctic is limited to 8.7 million tonnes per year, area 48 has an annual precautionary catch limit of 620,000 tonnes, and area 58 one of 3 million tonnes. However, since annual catches have averaged only 170,000 tonnes during the past decade – Tharos estimates a total 2015 catch effort of 245-275,000 tonnes – it seems unlikely that krill will ever be over-exploited.

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