Hudson, NY-Based Local Ocean Poised to Profit from World’s First Zero-Discharge Aquaculture System
March 12, 2012 | Melinda Clark
Efraim Bason, founder and Chairman of the Board of Local Ocean, a sustainable aquaculture company that has built and operates the world’s first commercial zero-discharge 100% recirculating aquaculture system, is no stranger to business. He owns a diverse portfolio of businesses ranging from a health and beauty products distributor to a real estate company. Now the self-described fisherman with a deep passion for the ocean is adding aquaculture to his repertoire.
Bason first learned that it was possible to farm saltwater fish in an aquaculture system about five years ago, when he moved back to Israel after living in the U.S. He was fascinated by two small aquaculture tanks at the University of Israel. Says Bason, “It was amazing, and I said if this could work, it could change the world. It can change the industry, it can save the ocean, and it can help people, with new jobs, green jobs.”
In 2008, Local Ocean began construction of its first fish farm, in Hudson, New York. The privately-owned, for-profit enterprise received its funding from a small group of investors who share the company’s vision.
In the beginning, Bason recalls, “It wasn’t so easy as we thought. We discovered that we don’t have enough knowledge and we had a lot of questions.” He adds, “I know in business, one plus one, it’s two, but in biology it can be 70, it can be 140.”
Bason says that he knew they needed to bring more people aboard, so Local Ocean sought out the best and brightest marine biologists, scientists and entrepreneurs. And in 2009, Local Ocean bought GreatBay Aquaculture (GBA), the first land-based commercial marine fish hatchery in the U.S. GBA supplies all of Local Ocean’s fingerlings.
“Today, I can tell you that we know how to grow fish in a zero discharge system,” says Bason. But, he adds, “I feel that this is only the beginning.” The company’s zero-discharge aquaculture system produces about 750-800 tons of fish per year.
Adds Vice President of Business Development Nadya Peeva, “…we are learning by doing. Operating a successful, fully-contained, zero-discharge, commercial-scale aquaculture facility requires unique expertise with respect to fish grow-out rates, feed formulations, and the ability to maintain the sensitive balance between total biomass and bio-filter processing capacity. The intricacies of maintaining a complex, dynamic, living system are extremely difficult to replicate… Because we operate a unique facility, no one else in the world has the breadth and depth of expertise we have acquired over the course of the last three years.”
Bason explains that there are basically three ways to raise saltwater fish:
One: cages in the ocean. The problem with this method is that not only are you limited to the fish that are suited to that particular ocean environment, but you’re contaminating the ocean and changing the naturel ecosystem – “playing with nature a little bit,” in Bason’s words.
Two: take water from the ocean to raise your fish. The problem with this is that people don’t want to see fish farms on waterfront properties – they want to live there. It’s expensive land. Plus, your fish will still be subject to contamination by the heavy metals – lead, mercury, aluminum – that pollute the open ocean.
Three: aquaculture. More specifically, zero discharge aquaculture, which is what makes Local Ocean so unique. It has taken its fully-contained, 100% recycling facility to the commercial level. To achieve zero-discharge, Local Ocean uses bacteria and plants to filter the water, in a method that imitates nature.
Unlike some aquaculture systems, where the waste products of the fish – feces and carbon dioxide – become runoff, and a source of toxins in the environment, at Local Ocean they become a source of nitrogen and carbon for the microbial biofilters, as well as a few plants being grown hydroponically. The water is purified by this process and is returned back to the fish tanks, making it a truly-closed loop system.
“We are cleaning the water the way nature cleans the ocean,” says Bason.
Though not fully an aquaponics system, Local Ocean is doing some experimenting. It’s currently growing mangroves, Salicornia (known as saltwater asparagus) and Gracilaria (a type of algae) hydroponically, with thoughts of creating not only food but potentially biofuel mass. Bason explains that aquaponics is an area they’d like to pursue, but Local Ocean is being careful not to overextend itself, especially at this early stage.
“We’re doing it step by step,” explains Bason. “We’re doing the first step, understanding the fish and later on how to combine it with the seaweed, then the Salicornia…The sky is the limit.”
In addition to producing great tasting, fresh fish, Local Ocean is able to provide a niche product. Even in the dead of winter in New York, it can provide warm water Mediterranean fish to the local marketplace, no transoceanic shipping required. Local Ocean currently produces Sea Bream, Sea Bass and Yellowtail commercially.
Another benefit is that unlike wild fish, Local Ocean’s fish can be eaten by sensitive populations, such as pregnant women and children, without fear of mercury or other harmful contaminants. In Bason’s words, “people are starting to realize and understand that it’s better to eat healthy fish and that farm-raised saltwater is as good as the ocean and a little bit healthier.”
This type of consumer understanding has been one of Local Ocean’s biggest obstacles, as well as one of its biggest rewards, according to Peeva.
“One of our biggest challenges and a tremendous opportunity is educating consumers, industry, and the media about the unique advantages of our system and our product. Since we operate out of an entirely new paradigm as the only land-based, zero-discharge marine aquaculture facility in the world, the mental model of what is possible for the industry is in the process of being fundamentally altered. Through the use of this revolutionary technology, aquaculture facilities can be built virtually anywhere in the world regardless of climate conditions or proximity to water. Local Ocean’s technology has created the possibility of everyone in the world having access to fresh, healthy, locally produced saltwater fish grown without harming the environment.”
Bringing New Life to the Term ‘Catch of the Day.’
With the plethora of frozen fish and fish being shipped around the world, most Americans aren’t used to eating fresh fish, says Bason. By the time it gets to us, “it’s not the catch of the day, it’s the catch of last week.” However, with Local Ocean, “the fish that used to swim in the morning, they’re being delivered to the supermarket in the afternoon. It’s really catch of the day. You cannot get fresher than that.”
While that may not be what we’re used to, so far it’s been well received. Bason says that “basically every door that we’re knocking, they’re opening.”
Those doors include supermarkets, restaurants and the public. About half of Local Ocean’s sales are retail (including about 10 percent online) and the other half is evenly split between restaurants/chefs and wholesale distribution.
In terms of profitability, Local Ocean is just about there. Says Bason, “We’ve been operating about three years; in May this year, we’re going to break even and we’re going to make our first dollar…I think maybe I will keep this dollar and show it to everybody and say, we made one dollar, we paid all of our employees – we have 35 employees – we have demand, we cannot supply all of our demand.”
One Fish, Two Fish
In the next few years, Local Ocean plans to expand its farms throughout the U.S. to perhaps five to seven locations. Bason says that with five farms, Local Ocean can deliver fish locally to about 50 million people. He says he thinks California will be the next farm, followed by Texas, Seattle and possibly Chicago.
According to Peeva, Local Ocean is also continuously working to improve its energy efficiency and decrease electricity use. For instance, it has implemented technologies that use gravity or trickling filters to move water through the system, rather than high pressure pumping.
Though still in its early phases, it looks like Local Ocean has a promising future. Perhaps this can be evidenced by the compliments Bason receives when he cooks Local Ocean fish for important guests.
“When they eat the fish, they think I’m an excellent chef. But to tell you the truth, I’m not such a good cook…you don’t need to do nothing.”