The wonder fish (cont.)
The true advance, however, comes from marine biology. Sims fastidiously controls every variable in the life of a fish. Kona Blue houses 150 brood stock on shore a few miles north of Kona. These breeders are continually refreshed with deep-ocean water and left to do nothing but eat, swim, and procreate. Every few days a female lays as many as 300,000 eggs, which are harvested and transferred to a nursery. Hatched fish eat zooplankton, which have been fed algae that naturally confer high amounts of DHA, EPA, and other omega-3 fatty acids. When the fish reach an inch in length, they head to the ocean. In the wild the survival of two eggs would ensure sustainability for the species. Kona Blue does far better. "We get survival rates of 5% to 10%," says Sims.
One knock against carnivorous aquaculture is that it depletes lower-level species in the wild to feed a farm. But Sims has spent six years developing food that uses fewer fish. Until recently it was half fishmeal and oils derived from anchovies and hake, and half oils and proteins from canola, soy, flax, corn, and wheat. Then last month he did something wacky: He began feeding chicken to his fish. Actually it's byproducts of poultry bound for human consumption. Now the feed is only 30% fishmeal and fish oil. "We did a trial where we had no fish oil at all," he says. "It didn't do very well, but that's the level of science we're pushing here."
Wednesday and Sunday are harvest days. The company vacuums up about 10,000 pounds of fish; each yellowtail weighs four to six pounds. While Kona Kampachi can grow much larger, it doesn't make sense to let them do so. "We've done a lot of optimization on the profitability of the fish," says CEO Michael Wink, 35, who focuses on business issues and leaves Sims to the science. (Sims also handles the evangelization - he gives speeches on sustainable aquaculture all over the world.) A profitable fish converts feed into biomass efficiently. In controlled tests, sub-five-pound Kona Kampachi have shown conversion ratios of almost one to one.
Sims co-founded Kona Blue in 2001, taking funding from Tom McCloskey, the former chairman of Horizon Organics, and Garrett Gruener, founder of Ask Jeeves. The idea has always been to create a premium product, which shows in the price. Fillets sell for $12 per pound wholesale (about $20 retail or $17 plus shipping at kona-blue.com). Revenue hit $4 million last year, and the plan is to reach $9 million in 2008. Those are small numbers, but the upside is huge. The global tuna market was around $1 billion last year.
With a deep-water aquaculture model established, Kona Blue is set to expand beyond Hawaii, both for growth and to cut expenses. Its biggest cost - 20% of revenue - comes from shipping fish to the mainland. So Wink and Sims are scouting sites off Mexico while thinking about other locales and even testing another species, the giant grouper. "Hawaii is a beta site," says Wink. "Mexico has embraced aquaculture. The idea is to build a large-scale hatchery and grow-out sites where we can get product across the border at a fraction of what it costs from Hawaii."
Wink is also considering robotic cage cleaners and automated feeders to bring down costs. "We go out there every day and do the feeding. There's a lot of benefit to be gained by observing the process. You know a fish at a certain size should eat a certain percentage of its weight every day," he says. "But could you write software programs to do that? Probably."
No environmentalist will declare Kona Blue's model perfect. It earns high marks for growing an indigenous species (meaning that escape would have minimal impact). But it's still fostering a monoculture, which can be a powerful vector for disease. Then there's the poop issue. "Dilution is not the solution to pollution," says Corey Peet, an aquaculture analyst at the Monterey Bay Aquarium, who would like to see a more biologically diverse system. Nevertheless, he praises the company. "The success of aquaculture will depend on balancing ecological sustainability with economic realities. We're very impressed with Kona Blue's willingness to constructively engage with us and work on issues."
Kona Kampachi has caught the eye of star chefs like Bernard Guillas, Michael Mina, and Jean-Georges Vongerichten. Until recently Whole Foods (WFMI, Fortune 500) was also a fan. Tim Aupperle, a regional seafood coordinator, had great things to say late last year. "They're two or three steps ahead of everyone else," Aupperle told me.
But when Sims began using poultry meal, the retailer stopped selling the fish out of concern for customers who eat fish but not meat. Sims had been warned that this would happen, but he proceeded anyway because using chicken meal, it turns out, is more ecologically sound - not to mention cheaper. Not all retailers reacted like Whole Foods.
Come June, King's Supermarkets in New Jersey and 85 Kroger stores around the country will sell Kona Kampachi. The fish is also available at Costco (COST, Fortune 500) in Kona, but has been only "mildly successful," says seafood buyer Bill Mardon. To truly whet the appetite of the Costco crowd, Wink and Sims will have to swim downmarket. A Whole Foods customer who spends $20 a pound on grass-fed rib eye might be okay with springing for a designer feel-good fish. But warehouse shoppers have different ideas. "To compete out of the gate with well-known fish is a challenge," Mardon says. "But that's one of the potentials of aquaculture. If they can become more efficient, there could be a good future."
And about that tiger shark: It didn't take much to talk Sims out of the James Bond boat-hook routine. I told him I hadn't negotiated any danger pay. He decided to wait until the feeding was over and have the captain drop us closer to our boat. It was a good example of what environmentalists like about Sims. He listens.
Far from shying from watchdogs, he craves oversight. He wants to establish standards, and he'd like his fish to have a valuable "organic" label to experience the bump vegetable and cattle farmers enjoy. Most of all, he wants to build a viable industry.
His point is that we've had 10,000 years to develop terrestrial agriculture. We'll have nowhere near as long to get aquaculture right. "Commercial fisheries can see the same thing we see," Sims says during our ride back to shore.
Before us is an endless expanse of cobalt-blue sea. To the south there's nothing between our boat and Antarctica. To the west it's water all the way to China. But Sims isn't looking out. He's looking down, where the scene is harrowing. "It's like watching a Shakespearean tragedy unfold," he says, turning to face me from beneath a canvas sun hat. "You know what the end is gonna be - it's gonna be a bloody mess."