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Aug 6, 2015 9:46 EST

AIS Aqua Shrimp: The Colombia Next Generation Shrimp Project

iCrowdNewswire - Aug 6, 2015

AIS Aqua Shrimp

AIS Aqua Shrimp

 

COMPANY OVERVIEW

Exceptional Market Opportunity. Changing dynamics in the global shrimp market today have created a “perfect” storm” for a new generation of investment in shrimp aquaculture production:

  • Asian shrimp aquaculture production was down by 19% in 2014 due to EMS disease. With Asian production based largely on highly dense concentrations of ponds in marine environments with poor water quality, Asian producers will remain extremely vulnerable to continued risks of disease and pressure to use antibiotics.
  • Chinese domestic demand for shrimp is growing, causing China to increase imports of shrimp to make up for shortfalls in domestic production, and providing a price support for new supply entering the global shrimp market. This trend is expected to continue for next three to five years.
  • Shrimp exports to China are therefore increasing, while US imports remains stable.Shrimp exports from Ecuador to Asia, for example, increased by 73% in 2013 and 61% in 2014 to meet expanding market demand in China.In 2014, China replaced the US as Ecuador’s biggest customer.
  • Demand for the highest margin, cooked product in Europe continues at consistently high levels, despite periods of financial instability, and is expected to increase as the EU economy accelerates recovery.
  • Recent revelations about abusive labor practices have discredited many producers in the Asian shrimp industry, highlighting their reliance on deeply entrenched illegal labor practices and adding to the current set of food safety and environmental issues of concern to EU and US buyers and consumers.[1] . For example, Thailand was downgraded to a Tier 3 ranking in the US State Department’s 2014 Trafficking in Persons (TIP) Report, the most negative classification.[2]

Strong Value Proposition.The Colombia Next Generation Shrimp Project will becash flow positive in the first year, based on:

  • Favorable market prices, due to current market dynamics as described above.
  • High volume:Capacity for three production cycles per year, based on a growth cycle of 90-120 days in a disease free zone.
  • High quality:Integrated, modern hatchery, production and value added processing infrastructure and assets ready for operation.
  • Immediate market access: AIS Aqua’s (AIS) established relationships with its customer base and its reputation for delivery of safe, high quality shrimp, fish and seafood products, provides immediate market access. Since 1996, AIS has been a principal vendor to Darden Restaurants, which includes Olive Garden and Longhorn Restaurants, and has successfully implemented program sales & distribution plans and vendor managed inventory (VMI) systems with large buyers, such as Red Lobster Restaurants.
  • Unique logistics advantages: The location of the processing facility within the Cartagena Free Trade Zone allows the project to import production and processing equipment duty free; its proximity to US markets offers cost advantages for shipping to the US, European, South American, and Mexican markets; and, its proximity to the Panama Canal provides direct access to the Chinese market.
  • Qualified local management team and experienced local labor force.AIS explicitly retained qualified local management and labor to avoid the loss of institutional knowledge and to maintain the commitment of the local communities to the successful operations of the farm, which has been operating the farm since 1983 and serving as an important economic asset for the three adjacent communities.
  • Low-risk 5-year lease/purchase agreement allows for immediate startup of operations without additional capital investment, ensuring production, profitability and payment to investors before the principal option to buy is exercised.

Highly Competitive Product: The Colombia Next Generation Shrimp Project will have the capacity to rapidly produce a high volume, high quality, disease-free product that can take advantage of favorable market conditions, based on the following competitive factors:

  • Production in Caribbean waters free of disease, located next to a national park and protected by natural zoning separators and mangroves.
  • Low-density stocking model that reduces stress on animals, resulting in consistent excellent survival rates.
  • Hatchery sited separately from the production area, which ensures bio-secure production of post larvae.
  • Proven advanced natural genetic selection process for Specific Pathogen-Free (SPF) brood stock, selecting for shrimp health, vitality and growth.
  • Introduction of steviol glycosides in feed that reduces stress and improves survivability by fostering healthy digestion and increasing feed conversion through better nutritional uptake, resulting in increased immunity to disease, faster growth, and higher yields.
  • Ecosystem benefits.The extensive coastal mangroves bordering the production area provide essential ecosystem benefits to shrimp farming, by serving as a buffer and filtration mechanism for the estuarine system that passes fresh water through the shrimp farm. Protecting and maintaining this estuarine system will also allow for poly-culture of “salt tolerant” tilapia, which is in high demand in the USA.
  • Social compact with local rural communities to provide much needed employment, road improvements, health assistance, and sports opportunities, with an emphasis on women and youth.
  • Advanced value-added processing equipment and technology able to comply with Global HACCP standards and strict EU sanitary requirements.
  • Food safety record: Managing Director Andrew Kaelin is a globally recognized expert in food safety, and has received a number of awards, including Darden Restaurants’ “Award for Food and Beverage Quality and Safety” for prevention of antibiotic use and extension of shelf life for seafood product from China.
  • Quality control: Based on the phase one raise already completed, the project will exercise its option to buy the processing facility for US$1.00 before the option to buy the farm is exercised, guaranteeing total control over quality assurance.

Experienced Professional Team. AIS Aqua Shrimp is a division of AIS Aqua Foods (AIS), whose competitive advantages include:

  • Over 55 years experience in the international seafood and aquaculture business, including shrimp farming in Central America, and scallop, shrimp and tilapia production in China, Peru and Colombia, serving major seafood buyers in the US market.
  • AIS Managing Director Andrew Kaelin who has been a consultant to the World Bank since 1989, analyzing more then US$700 million of fisheries and aquaculture loans, and is a globally recognized seafood expert who continues to speak and serve as panel member at annual seafood conferences.
  • Founding Member and past sponsor of the Global Aquaculture Alliance (GAA) and actively involved in the National Fisheries Institute (NFI) and a frequent advisor to the International Coalition of Fisheries Associations (ICFA).
  • Project implementer for global fisheries sustainability project with funding from Allfish (World Bank), and GEF (Global Environmental Fund).
  • Strategic partnership with Stevia Corp (a publically traded company, STEV), who has developed proprietary glycoside formulas, protocols, probiotics and enzymes for shrimp feed.

Operational Assets. The Colombian Next Generation Shrimp Project comprises:

  • Production Area: 81 grow-out ponds on 680 hectares, with and estimated production of more then 8 million pounds annually, employing approximately 250 workers, the majority with prior shrimp farming experience.
  • Hatchery:Will produce post-larvae for the grow-out ponds but initially SPF bio-secure post-larvae will be purchased to stock the grow-out ponds.
  • Processing Plant:The seafood processing facility in Cartagena’s Free Trade Zone will have the capability of processing and shipping the shrimp harvested from the grow-out ponds, employing approximately 300 worker (mostly woman) once the shrimp farm is in full production.

 

Contact Information:

Anwar Kaelin
George Blankenbaker
Andrew Kaelin
Santiago Sierra

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