Commercial aquaponics.. viable or not.. and why?

[Dino Pantelidis]

So much discussions have come about regarding the viability of aquaponics as a business.

Can it work, or not?

and why?

In Canada (Toronto specifically) the focus for local has been huge. Being in a cold climate we cannot source certain products locally, and they come from California, or Mexico. I have no experience running aquaponics on a huge level (I've got a small setup on the second floor of my restaurant)

But what I dont get, is why is a hyroponic/greenhouse setup selling, say cucumbers viable?

We have greenhouses in Ontario growing peppers, cucumbers,  year-round in a cold climate. so these guys have heating costs in the winter, probably artificial light for the lack of sun in the winter - and I am sure they are turning a profit? (They wouldn't be in business if they werent making money!)

Regarding additional income streams such as consulting, training, farm tours

That is all part of the business IMO. My restaurants turn a profit from all aspects of the business. (ie. Catering) but are base is dining in/taking out)

If you look at my restaurant model, I've got 3 cooks, 2 waitresses, cost of rent, heat, hydro, enormous food cost (30-40% in many cases) TONS of competition, and at the end of the day we turn a profit.

from 7am to 10am we sell 3 eggs, 3 bacon, homefries, toast and coffee for 3.99!! plus I got to pay all those other costs. but money is made because of turn-over.

Why NOT aquaponics? (forgive my lack of knowledge)

But if you've got say, 4000 sq. feet of grow beds, ample lighting etc. and you follow what most of the experts are saying. (ie. say 27 holes per 2X4 raft)and decide to grow, say buttercrunch lettuce

4000 sq. feet should technically give you a gross production of 13,500 heads of lettuce?

obviously you stagger the harvest cycles, have an ample amount of seedlings ready to replace the harvest.

Is it unrealistic that 4000. sq. feet of grow beds, with proper lighting, fish to plant population etc. will output, say 10,000 heads a month?

am I missing something here? (again, forgive my lack of knowledge regarding aquaponics, growth times)

I'd love to dive in and learn aquaponics, grow year-round for the many, many local restaurants that "do" source locally but simply cannot find them.

I guess I am trying to figure out what one could expect out of total production, then discuss the input costs etc.

Would love to hear your opinions.

[Vlad Jovanovic]

Your right TC it could be as simple as that...probably because some of the links Dino had posted i.e Mirabel/HydroSerre/Hydronov, (huge Commercial facilities) as well as some of the numbers that were provided for wholesale lettuce by the case... things turned to Commercial with a Capital C...(land/rent/investors/NON-owner operater etc...)

Whether one is any less commercial than the other...well by its most fundamental definition...no.

I've said it before, and I'll say it again... Other than some of the research that would/may eventually come out of an AP Commercial Industry setting...I hope to god AP stays in the grassroots realm of backyard mad scientists,small mom and pop producers, own/operators...because if Commercial Industry Interests ever decide that AP is worth doing...I'm pretty damn sure that the above mentioned folks' days of selling AP produced food will be over. I am quite positive that Commercial Interests would ensure that new (labyrinthtine) "Safety" regulations, permits, laws regulating the aquaponic production of food, would be enacted to "protect the public" as well as protect their new found AP interests and the profits (ROI) that their investors would demand.

Lets stick to "smallish" operations.

I then wonder things like...But really, how far can a niche market take you? If the niche grows (think Organic food), it no longer becomes niche, and bigger players become involved (eventually ones with Big-Time Commercial interests) which drive down price narrowing (your already thin I imagine) margins?  

I'm interested in AP as a workable and relevant (and hopefully part of a responsible) agricultural model in what ever form that model may take. 

[TCLynx]

Well, I hope the Local movement can help keep operations small.  And you are right that a niche market can only get you so far.  The real question then becomes, is it far enough to support you? 

And Farming does require diversification.  Especially small scale farming.  As I think Adam was saying,

Live where you work (or work where you live) and live within your farm's means and find different ways to creating income streams.

I too dislike the sales model for aquaponics that makes really high claims on production numbers since that is really counting the chickens before they have hatched.

As to the future of agriculture.  I think much of the world will have to get back to victory gardening (I think aquaponics will make a great addition to many gardens.)  See if everyone has a little bit of food growing going on in their back yard, suddenly the big ag could theoretically manage to grow enough of the surplus and the staples to feed the fast growing world population.  Unfortunately, big ag prefers to sell more unwanted empty calories to the rich parts of the world (added fats from soy and high fructose corn syrup from corn, it's hard to find any processed food products that don't contain these) instead of shipping the grain to starving populations. 

BUT one step at a time.

Eating more local fresh foods will allow us to be healthier and reduce our food miles and stretch the world resources further as the population expands.

I would love for everyone to be able to go to the more permaculture kind of agriculture and I try to do a lot of permaculture  around my house but each family doesn't necessarily get to have a once acre pond to provide their fish nor an acre of garden per person and a good well water to provide all their food.

[Todd Sowell]

I agree Vlad. We need to stay under the radar. That's been my concern with the aquaponics association. No need to go knocking on the governments door saying we're here!

Vlad Jovanovic said

I've said it before, and I'll say it again... Other than some of the research that would/may eventually come out of an AP Commercial Industry setting...I hope to god AP stays in the grassroots realm of backyard mad scientists,small mom and pop producers, own/operators...because if Commercial Industry Interests ever decide that AP is worth doing...I'm pretty damn sure that the above mentioned folks' days of selling AP produced food will be over. I am quite positive that Commercial Interests would ensure that new (labyrinthtine) "Safety" regulations, permits, laws regulating the aquaponic production of food, would be enacted to "protect the public" as well as protect their new found AP interests and the profits (ROI) that their investors would demand.

Lets stick to "smallish" operations.

 

[Ryan Sala]

Hi new guy here, Im not going to chew anyones ear off and reiterate the above posted. However Id like to pose a question, that pertains to the topic. Is Aquaponics viable commercially? I asked myself this same question last night as I was preparing a buisness plan to propose on the 15th of this April to an investor Ive been coaxing for the past 3 years.

Ok so heres the question..

Why do we have to tell the buyer its Aquaponics? Is there some law regarding the divulging of how its grown? Oh sure there is, but if your meeting all the regulations, whats to stop you from saying to your potential client that its organic period?

I think were relying on that "selling point" too much. Yes its the bees knes, but if it stops us from making a profit then why not just leave out the untasty parts of our industry to our sheeply consumers?

[TCLynx]

Well you only get to say it's "organic" if it's "organic" and you don't get that until you get certified, if you are even going to bother getting certified.

However there is a very interesting new thread over on BYAP that might answer some of the questions.

The Good Dr has some really on point comments I believe.  In that on a small scale, aquaponics could find a niche in direct sales and niche markets.  On a larger scale many of the new Aquaponic operations seem to be trying to step into a "black hole" in scale that might not be reasonable.  As in, "you can't compete wholesale" unless you are "big enough to compete wholesale".  Add to that, many people who first learn of aquaponics and feel it's the "bees knees" and want to jump in with an off the shelf business plan and think they can do it from a desk instead of actually doing the work of framing and suddenly aquaponics doesn't seem quite so "commercial" anymore as people with no knowledge of business or farming try their hand at it as a commercial venture.

Now I'll be the first to venture that I'm probably way in over my head and it's a good thing my tanks are less than 5' deep cause I'm not very tall.  BUT, since some one has to be the first one into the pond (and the second and the third and so on) there are several people out there testing out small scale aquaponics as a business and some medium and perhaps even a few looking at the large side of the line.  Anyway, it will take several operations succeeding before it will get easier to convince investors.

As to the customers/consumers, I believe they will be far easier to convince of high quality local produce and while they may not really care that fish are producing the nutrients, they usually think it's kinda cool.  I don't think the "selling point" of it being aquaponics makes much difference really.  It is grown without using chemical fertilizers, pesticides or herbicides and that is the selling point, seeing the fish alive and well can help punch that point home but it is more important to get your product out and familiar to your customers and educate them a bit which will be the case no matter what kind of farming you are doing.

Does it matter to the investors?  Technically, probably not, what matters to them is can you convince them you can make a profit at it and ear them a return on their investment.  Aquaponics only affects that in that there are not many operations out there that can show success long term yet.

[Ryan Sala]

Good stuff. 

Im trying to further convince my investor that to successfully educate the local consumer, a small cafe would be essential. Then maybe a fruit vege cart outside as well. He hasnt nibbled yet.. He thinks im trying to spin to much into it. 

Also worm farming and compost selling. But I keep telling him we need to diversify our possible selling avenues, so if one unexpectedly gets slow, the others can pick up some slack. 

Rawr

[Jonathan Kadish NYC AA Chair]

Lets put it this way, someone figured out a way to market rocks as pets. If you can sell a rock you can sell some lettuce. Your investor should be far more worried about your business plan. The question to ask is "Am I viable as a business person?" This really has little to do with aquaponics.

[Averan]

+1 to Ryan and Jonathan

[Paul Trudeau]

Thanks for the link to the very interesting BYAP thread, TC.  You seem to be everywhere--I don't know how you do it.  I can't even keep up with what's going on in one forum!

TCLynx said:

Well you only get to say it's "organic" if it's "organic" and you don't get that until you get certified, if you are even going to bother getting certified.

However there is a very interesting new thread over on BYAP that might answer some of the questions.

The Good Dr has some really on point comments I believe.  In that on a small scale, aquaponics could find a niche in direct sales and niche markets.  On a larger scale many of the new Aquaponic operations seem to be trying to step into a "black hole" in scale that might not be reasonable.  As in, "you can't compete wholesale" unless you are "big enough to compete wholesale".  Add to that, many people who first learn of aquaponics and feel it's the "bees knees" and want to jump in with an off the shelf business plan and think they can do it from a desk instead of actually doing the work of framing and suddenly aquaponics doesn't seem quite so "commercial" anymore as people with no knowledge of business or farming try their hand at it as a commercial venture.

Now I'll be the first to venture that I'm probably way in over my head and it's a good thing my tanks are less than 5' deep cause I'm not very tall.  BUT, since some one has to be the first one into the pond (and the second and the third and so on) there are several people out there testing out small scale aquaponics as a business and some medium and perhaps even a few looking at the large side of the line.  Anyway, it will take several operations succeeding before it will get easier to convince investors.

As to the customers/consumers, I believe they will be far easier to convince of high quality local produce and while they may not really care that fish are producing the nutrients, they usually think it's kinda cool.  I don't think the "selling point" of it being aquaponics makes much difference really.  It is grown without using chemical fertilizers, pesticides or herbicides and that is the selling point, seeing the fish alive and well can help punch that point home but it is more important to get your product out and familiar to your customers and educate them a bit which will be the case no matter what kind of farming you are doing.

Does it matter to the investors?  Technically, probably not, what matters to them is can you convince them you can make a profit at it and ear them a return on their investment.  Aquaponics only affects that in that there are not many operations out there that can show success long term yet.

[Dino Pantelidis]

Anyone ever heard of these guys? apparently they are a commercial aquaponic farm in the U.S

http://www.herbanfarms.com/index.html

By the looks of it they look like a serious operation, growing strictly basil.

[Wayne]

Hi everyone!

Its been a while since my last visit, but this is a topic that I had been wondering about myself. Diversity is key to most any business long term success. In my area for example, it is a rural setting where backyard gardening is still practiced by quite a few people. But while they grow their own vegetables, they tend to buy their plants rather than start them from seed. I started a few hundred extra tomato plant this year and nearly all of them have been sold!

Well some I did give away, but I gave them to the "go to guys" in the community. You know the type. The ones that everybody ask their advice. My plants had a healthier look and were much larger than the plants sold at the hardware store and Walmart. The hope is that these plants will out preform the plants they are use to getting.

The local hardware is now selling a few of my plants and we are discussing entering a deal to sell a larger variety of plants next year. Of course a bad growing season will be a direct reflection on the plants(people never consider the growing conditions or their own lack of green thumbs) so relying on this one revenue stream is hardly a viable business model. Worms are another product that stems from my AP system, but here again it is a seasonal market.

Creating a full time income from AP is not realistic in my area, but I think it would be feasible in other areas of the state. As for teaching AP as another source of income, I consider the knowledge gained from having your own AP system just another bi-product that should be marketed along with the fish and produce.

Business is all about the bottom line.  

[Pices]

Thanks for the link Dino. Yes, it does look like an impressive operation. I like how they utilize most of the greenhouse growing area. The other thing I was impressed to see is that they are GAP certified. Makes me wonder how their operation is different than the Friendly Aquaponics operation in Hawaii who had to give up their Cosco account due to inability to get GAP certified!

Dino Pantelidis said:

Anyone ever heard of these guys? apparently they are a commercial aquaponic farm in the U.S

http://www.herbanfarms.com/index.html

By the looks of it they look like a serious operation, growing strictly basil.