Aquaculture is as difficult as any other farming method or technique, says New Zealand King Salmon (NZKS) CEO Grant Rosewarne. This is even more so when it comes to salmon fishing. “First of all, with salmon, you don’t farm once, you farm twice,” Grant explains. “They start in the freshwater and you have to farm them to a certain size there. Then they turn into smolt, which means they can handle sea water. So you transfer them to sea water and farm them there.”
As salmon are an anadromous fish – having the ability to survive in both freshwater and sea water – it poses more problems during production. “It means you’ve doubled your risk, because you’ve got to go successfully through two environments where things can go wrong,” Grant continues. “You’re also in a continuous liquid phase, and that means all manner of things can come through the water column that could affect your fish; including high temperatures and algae.”
But despite these challenges, NZKS has built a strong salmon business that is only getting bigger and better. NZKS only farms King salmon, which account for just 0.7% of the world’s salmon species, and the company produces more than 50% of the world’s King salmon supply. Grant says that King salmon is by far the hardest species of salmon to grow and one of the reasons for this is its spawning cycle.
“King salmon is a terminal spawner,” he says, “meaning it spawns and then dies. Whereas you have Atlantic salmon in Australia, which can spawn, go back out to sea, return next year and just do it again and again. That makes them easier to farm. As our fish start to mature, they will spawn and die, so we lose all the stock.”
Grant adds that King salmon are like gazelles or deer, whereas Atlantic salmon are like sheep or cows; more domesticated. And he further explains why farming King salmon is more complex. King salmon (also called Chinook salmon) are native to the North Pacific Ocean and were introduced to New Zealand as a game fish during the late 19th century. But it wasn’t until the late 1970s that salmon farming became commonplace in New Zealand.
NZKS has three hatcheries, eight salmon farms and employs 480 workers. Its farms – Waitata, Kop¯aua, Ruakaka, Otanerau, Clay Point, Te Pangu, Ngamahau and Waihinau – are located in the waters of the Marlborough Sounds. The company’s main brands include – Ora King, Regal, Southern Ocean, Big Catch Burley and Omega Plus pet food. In 2018, it added a new, exclusive product for chefs: - Ora King TYEE salmon.
The word tyee comes from the Chinook people of North America and means boss, chief or king. It refers to a particular run of King salmon that was found in the upper Columbia River, which extends from British Columbia in Canada through to the US state of Washington. While the average – Ora King salmon grows to five kilograms over a two-year cycle, tyee salmon is left to grow over a four-year cycle and up to 13.6 kilograms.
“These massive fish used to swim up the Columbia and the Chinook peoples would look for that run and catch them,” Grant says. But while there had been larger runs of this type of salmon in the past, their numbers have since dwindled. “The Grand Coulee Dam was then built in 1939 and the large numbers have never really been spotted since, but you can still catch them on other rivers occasionally.”
Now, between 15 and 100 tyee salmon are caught a year, but if you want to catch them, you have to follow strict guidelines. “You have to catch the fish with a hook with no barb; you have to catch them on a line, no more than nine kilograms in weight; and you have to catch them from a wooden rowboat, not from a trolling motor,” he says. “If you do all of that and you catch a tyee King salmon, then you’re a tyee fisher. You get a little lapel pin and it means you’ve joined a really select club.”
Grant is proud to say that NZKS recently joined that select club, when it discovered a peculiarity in its stock. “We’ve always had some fish that grew to be very large, but we didn’t really understand it,” Grant says. “Now, we’ve worked out we have some of these tyee among the food stock here in New Zealand and have started growing them to a larger size.”
When the company launched its tyee range, it sold it at the same price as bluefin tuna – one of the most expensive of all fish. “It’s been hugely successful,” Grant continues. “And if there’s an aquaculture equivalent that’s of a similar quality and application to bluefin tuna, it’s the tyee. It’s a highly differentiated product, with a fabulous price and helps take the pressure off the bluefin tuna wild catch.”
Grant’s story
Grant grew up on a farm in Australia that produced grain as well as meat and dairy products. “It had about 30 cows, 300 chickens, 500 sheep, and wheat and barley,” he says. “And deer roaming around.” As Grant grew older, he decided against becoming a farmer because of the challenges his family often faced. “It’s too risky with the biology and climate; there are so many factors that are beyond your control,” he explains.
Instead, he opted to go to university and he was the first one in his family to do so.
“I would go back at Christmas time to visit the family on the farm and my mum would say, ‘Why don’t we take out A$1,000 and just burn it’. Because if that’s how much you’d put in, if there was a drought, you’d get nothing back.”
While at university, Grant went into science, studying chemistry and microbiology. When he finished, he took up a position at consumer goods company Unilever, where he found his true passion. “I decided early on as a microbiologist that I didn’t have too much influence over strategy, direction and resources,” he explains.
“But I noticed that the sales and marketing people seemed to enjoy all those things, so as quickly as I could, I did an MBA and swapped over from technical roles into sales and marketing.” Thus, Grant moved on from technical positions, such as factory manager and quality assurance manager, into a brand manager role. “At the time, going from quality assurance management into brand management was a fairly unusual thing to do,” he notes. “But Unilever had a program for that, and I stayed with them for 10 years. I managed some of the leading brands, and that’s when I became familiar with both fast-moving consumables, and branding and marketing.”
Grant later joined Sara Lee and worked in its coffee division as a sales and marketing director. He worked particularly on the Moccona coffee brand and considered it a real step up in his career. “Moccona was virtually a nothing brand back then,” Grant says. “Originally, I was struggling with the fact that I worked on it, because the view in those days was that there was already Douwe Egberts, a 250-year-old Dutch filter coffee company. And we also thought we shouldn’t put any effort into instant coffee because Nestlé was so powerful, that it would swoop down and crush us.
“That’s why I came to this role; for the opportunity to take the salmon from commodity to premium commodity, and ultimately to a premium branded food delicacy.”
We didn’t want to earn the ire of Nestlé.” But there was a new boss appointed to the coffee division shortly after Grant joined who could see the potential within the market for Moccona. “We developed a valuable property addition around Moccona with the focal point being ‘boy meets girl’. The girl would always say no at first, then she would see or smell Moccona and think ‘Oh, maybe I will’. And the ending was generally left unresolved for your imagination as to what happens next.
“That turned into a famous campaign, and from there, the brand grew from around 3% to 19% in value. It made an absolute fortune for the company.” Grant was then promoted to managing director of coffee brand Douwe Egberts in the UK, where he worked on its Senseo coffee machine. “It’s a Dutch equivalent of the Nespresso machine,” he notes. During that time, Grant also served as chairman of Sara Lee in the UK and chair of the British Coffee Association. After a time in the UK, Grant decided to move back to New Zealand with the intention that it would be only temporary, when an opportunity came up at NZKS.
“I know this sounds odd, but I thought to myself that this could be my career,” he says. “The company produces a highly differentiated product that’s exported to the world, and could be at the very top end of the salmon market if we branded and marketed it correctly. That’s why I came to this role; for the opportunity to take the salmon from commodity to premium commodity, and ultimately to a premium branded food delicacy.”
There are 6 main species of Pacific and Atlantic salmon:
Pacific salmon
King salmon (Chinook): These are usually the most expensive salmon and have the highest fat content. They are highly favoured for their silken texture.
Sockeye (red): The sockeye are also called red salmon as they turn red when they travel upstream to spawn. Plus, they have a richer flavour.
Coho (silver): Aptly named for their silver colouring, coho salmon have a mild yet very distinct flavour. They are also prized among sports fishers for their fight.
Chum (dog): Chum salmon are low in fat but their roe is highly sought after. When the roe is strained, the eggs make ikura – the orange pearls often used in sushi. Chum salmon are called dog salmon because of their dog-like teeth.
Pink (humpback): These are the most common of all Pacific salmon and are often canned, smoked, frozen or sold fresh. They are called humpback salmon because of the hump they develop on their backs when they spawn.
Atlantic salmon: Simply called Atlantic salmon, these are also considered good sport fish. All the salmon sold commercially comes from salmon farms.
Back to the ‘farm’
Grant didn’t expect to be back in farming but he knew he had the skills to take NZKS to the next level. When he was appointed the company’s CEO, Grant’s main goal was to enhance its branding, pricing and marketing efforts. “One of our objectives was to be the most heavily branded salmon company in the world, which we have achieved,” he explains.
However, Grant says he didn’t want the company’s products to say salmon, King salmon, or New Zealand King Salmon; instead he wanted its - Ora King brand name to be featured, and for a very special reason. “That was very much a food service strategy,” he says. “We wanted to see - Ora King written on menus, that way we get into the mind of the final consumer.” This strategy has paid off significantly and now - Ora King salmon is listed on menus of several hatted and Michelin star restaurants around the world, including Australia. In addition, this visibility has contributed to the value of the company increasing 55% in the nine years since Grant started.
With the company’s success over the years, Grant believes that aquaculture will become the most valuable industry in New Zealand. Speaking to the Marlborough District Council earlier this year, he said it could become bigger than the country’s wine industry. “That’s because of the massive value,” Grant explains. “We can create about NZ$25 million of revenue per surface hectare. The problem with aquaculture is that its numbers seem too good to be true, so people can’t get their heads around them.
At the same time, we’ve got really low density; so fully stocked salmon farms are still 98% space and only 2% fish. I’ve been on Atlantic salmon farms, where they put out 90 tons of feed and the fish gain 100 tons of flesh. The fish put on more weight the day they eat feed. Believe it or not, you can achieve that with aquaculture.” Plus, salmon farming has an ‘economic multiplier’ effect as it creates jobs and income for several stakeholders; from suppliers and partners to scientists and water taxi drivers.
Strengthening the company, however, is not without its challenges. “When you’re new, you have to obtain your natural resources under a completely different paradigm, where there are a lot of competing users and everybody wants the space. We’ve also had a range of temperature and climatic challenges that have dampened our production somewhat. Salmon ideally need temperatures below 15°C and there are few places like that because of global warming, so that’s a big challenge.”
While farming King salmon species in New Zealand isn’t as fine-tuned as Atlantic salmon farming, Grant says it’s headed in that direction. “All salmon farms are swimmable,” he says. “The big deal with being in New Zealand is that a lot of rivers are not as swimmable as they used to be. But the good thing is that aquaculture doesn’t cause any problems with bacteria like at a terrestrial farm. We’ve got an excellent yield, we take up a small amount of space, and if we farm to a high standard – which we do – there’ll be more large aquatic animals in association with the farm than there was before. It’s the only farming method I know of where you can get an increase in biodiversity and not a decrease if you run it well.”
And with new salmon fishing technology on the horizon, the company is set to grow even more. “There’s new technology that’s going to allow us to go offshore, where there won’t be competing users and therefore we could become New Zealand’s most valuable industry,” Grant says. This technology is being developed in Norway and although it is still in its testing phases, NZKS is keeping an eye on it for the future. “We’ll be applying for space offshore very soon and when the technology comes onstream, we will be able to produce significantly more salmon. We think our potential would be about 300,000 tons.”
In addition, the company is diversifying its products to add further value to the salmon industry. “We’re going into every category where we have a competitive advantage,” Grant notes. “That’s into fine dining restaurants – where we have a superior taste, colour and texture – but also into retail where we have a better brand proposition. Our salmon has amazing health benefits because it has so much DHA and EPA, and because of our oil content, we have double the omega-3s of Atlantic salmon.”
A top team
Having worked at NZKS for nearly nine years, one of the things Grant enjoys the most is working with his team. “People are so complex and so individual and that makes life pretty fascinating,” he says. As a leader, Grant believes it’s essential to get your team inspired. “It’s important to have a really good vision for your team to see what the potential future looks like but also have a very clear path about how to get there,” he says. “Then make sure everyone understands how their role fits in to achieve that. Also, have a supportive culture to help the team achieve their hopes, dreams and aspirations along with those of the company.”
NZKS regularly measures team engagement and takes note of those who are putting in the extra effort to achieve the company’s objectives. “I’m very big on strategy because there are a lot of different ways to achieve the company’s objectives,” Grant continues. “We want to define the culture because we want people to not only achieve the results, but also achieve them with a great environmental outcome. We want everyone who touches New Zealand King Salmon to be better off as a result; whether they are an environmentalist, a team member, a supplier, the community, a neighbour or a customer. Whoever they are, we want them to be our stakeholder.”
Sustainability is a must
While it may be obvious that positive financial results are a good indication of a successful business, Grant pushes the idea further and says the company looks at sustainability as well. “One of our philosophies is that you should pass on the land and water resources to the next generation in a better condition than that in which you inherited them,” he says. “We look at how our business can go on in perpetuity without an increase in environmental impact.”
“You should pass on the land and water resources to the next generation in a better condition than that in which you inherited them.”
The company has a strong commitment to sustainability by using proactive aquaculture management, maintaining a clean rearing environment, sourcing sustainable feed products and ensuring humane harvesting practices. Water temperature, oxygen levels and salinity are also monitored each day to ensure the perfect conditions for the salmon.
With the number of sustainability strategies NZKS employs, it received the ‘Best Choice’ rating from Monterey Bay Aquarium’s Seafood Watch. ‘Best Choice’ means the fish was caught or farmed in a way that causes minimal harm to other wildlife or habitats, and NZKS’s salmon is
the first and only ocean-farmed salmon to receive the accolade.
“We look at how our business can go on in perpetuity without an increase in environmental impact.”
Moreover, all the company’s hatcheries, processing facilities and farms have achieved the four-star Best Aquaculture Practices (BAP) certification from the Global Aquaculture Alliance – an international group that advocates responsible aquaculture practices. The award is the equivalent to a restaurant receiving a Michelin star and is the highest designation in the BAP program, and NZKS is the first salmon producer in Australasia to achieve this. In addition, NZKS worked together with the Marlborough District Council, environmentalists and marine scientists to develop Best Management Practice guidelines for salmon farming.
Achieving the impossible
In light of his professional career so far, Grant says he would go back and tell his younger self to be more confident. “I would tell myself to switch out of the technical role into a more general management role earlier in my career,” he says. “I think it was great having that technical background but my career really started to take off once I got into sales, marketing and general management.”
“If you’re determined and you’ve got a good strategy and a good team, you can achieve the impossible.”
He would also emphasise the need for determination. “If you think you can achieve something, be determined and stick with it,” Grant continues. “Don’t be dissuaded by the myriad naysayers. Because I’ve seen a lot of that in my time. In the beginning, here at NZKS, there were many who said ‘There’s no such thing as a fish brand on menus. How are you going to achieve that?’ But if you’re determined and you’ve got a good strategy and a good team, you can achieve the impossible.”