It is old news, in fact, the whole aquaculture story is old news...

It is old news, in fact, the whole aquaculture story is old news but that is not to say it is not without merit.

One of the real pains for this industry has been the charlatans that have tried to raise capital for dog IPOs such as Australis Aquaculture and Western Kingfish.

Australis of course was going to be a land based Barramundi farm based out of Turner Falls in the States (from memory). What the Prospectus failed to point out (but I did point out to ASIC who failed to acknowledge or act) was that the Turner Falls facility had in fact been through bankruptcy at least twice. It is a simple fact that land based aquaculture cannot compete with ocean based due to the capital costs (predominantly the land) and the cost of heating, pumping (and cleaning) the water.

With respect to Western Kingfish, that project was promoted by a Merv Collinson and had been around for more than 10 years under the name of Jurien Bay aquaculture. That site was never going to be viable and they were always going to have to go to larger leases to become commercially viable. Problem was that the boffins thought you could start a trial farm, not go broke, and expand with a proven concept. Doesnt work in Aquaculture because you constantly need money to feed, maintain, harvest and then sell. That is, you need to be well capitalised from the start.

And who have we got to thank for this? The common denomintator is Alan Hill from State One stockbroking in WA.

Two raisings, two administrations and untold damage to the credibility of the industry. And he is stil in business!

Am I ranting? A little, but bear with me.

Internationally, aquaculture is a massive industry, Cermaq (Norwegian listed) farms over 330,000 tonnes of Salmon and Ocean Trout per annum (consider Tassal, less than 15,000 tonnes p.a., there is a sell recommendation). Australia consumes over 220,000 tonnes per annum.

Australia imports over 65% of its seafood (for example, 100% of fishfingers) but it exports nearly all of its high value species such as Tuna, Abalone and Crayfish.

The fundamentals are there, the story is coming together, I could give you the drum on Japan but you probably already know it (if you have been reading the releases and doing your homework). They have made the right management changes but the SPP will weigh down on the stock until it is over.

LT it is an accumulate but be ready for ST pain.

so endeth the lesson.

(PS do I get marks for number of words?)