Yellowtail kingfish (YTK) farming is identified nationally as the greatest opportunity for new aquaculture development in the next few decades through substantial increases in farmed area and product, and use of aquafeeds, resulting in growth in regional economies and employment. Within 10 years, YTK production is expected to increase by 34,000 tonnes, worth $440 million, and using 68,000 tonnes of aquafeed worth $136 million. The key challenge to achieving this growth is for industry to diversify its focus from supplying only the relatively small volume, high price sashimi market to the larger volume, lower price Australian "white fish market", while enhancing farm productivity and reducing operating costs to maintain profitability. This project will enable industry to grow its position by developing more cost effective, sustainable feeds and feeding strategies to enhance YTK growth and health; the industry's highest common R&D priorities as feed and feeding strategies comprise 60% of operating costs. It will also network two key Australian YTK aquaculture companies and their aligned research institutions (SA and NSW). A third producer (WA) and aquafeed companies are likely to invest in subsequent years. As such, this project will meet the designated 'Rural Research & Development for Profit Programme' objectives:

1􀀑􀀃. Generating knowledge, technologies, products or processes that benefit primary producers,
2􀀑􀀃. Establishing and fostering industry and research collaborations that form the basis for ongoing innovation and growth of Australian agriculture.

The key Activities wil address the YTK industry's common R&D priorities through three components/themes:
1. Economically sustainable feeds and improved diet formulation (NUTRITION);
2. Improved FEEDING STRATEGIES to increase profit; and
3. Improving nutritional HEALTH to boost productivity.

Once the project is initiated the Steering Committee will develop an agreed approach to engage with aquafeed companies to maximise participation in and contribution to the project.

NSW currently imports over 85% of its seafood and needs a substantial increase in investment and production, most notably, major new marine based aquaculture development.(Bond University, 2012). However, marine aquaculture development is fundamentally constrained by the lack of background biological and economic information. To promote marine finfish production, the NSW government has invested significantly in establishing, through the normal application pathway (EIS, REF, public consultation, DA), a 20 ha Marine Aquaculture Research Lease (MARL) off Port Stephens with approval to produce up to 300 t fish/annum. The MARL is a vehicle to streamline approvals process, foster the social licence required for finfish production expansion in NSW, and to provide the fundamental information needed to encourage investment.

There are three key end users for MARL research: Industry, Public and Regulators. The research proposed on the lease will address short term needs central to the development of fish farming in subtropical waters of the Australian east coast and develop a platform for ongoing research.
DPI has begun dialogue with potential commercial partners to operate the MARL. These discussions have established that yellowtail kingfish (YTK) is the primary species of interest (although tuna is a candidate and is specifically approved for the MARL). This interest in YTK is in part is driven by a shortfall of Kingfish and Barramundi from aquaculture in local markets – of the order of 460 t at the Sydney Fish Market alone last financial year.

Industry need: YTK production within Australia has not been without its challenges and further research is essential, particularly when entering new farming environments. Previous CRC research (SFCRC 2008/903) has developed models showing rapid growth for YTK in warmer waters (18 months to 4.5 kg), but these models need validation. Further, there is a need to investigate health challenges and potential management options in a new offshore environment.

Public need: In gaining approval for the MARL, extensive public consultation was undertaken that identified key concerns with respect to the sustainable operation of the MARL. Traditional concerns over nutrient enrichment arose but were overshadowed by issues related to potential impacts on species of sharks and cetaceans. There is a need to investigate the MARL interaction with these species, and Port Stephens is uniquely well placed for this to occur. Port Stephens has the most intensive cetacean watch industry in the world and is the focus of a juvenile white shark and grey nurse shark monitoring program.

Regulatory need: DPI is funding development of a Marine Waters Sustainable Aquaculture Strategy for NSW (MWSAS), under State Environmental Planning Policy 62 – Sustainable Aquaculture (SEPP62) to streamline investment pathways and promoting sustainable seafood production. A MWSAS will describe the approvals process, best practice system design and operation, and identify areas suitable for future development. MARL research will inform a MWSAS in key areas of sustainability

Temperate marine fish farmers in Australia seek to have the option to choose between several species of fish based on market price, availability and cost of fingerlings and health and feeding costs. This need was identified at the Aquafin CRC workshop held in 2002 (Allan, 2003). Most research on temperate marine finfish has been conducted on snapper (Pagrus auratus) but farmers are now concentrating more on yellowtail (Seriola lalandi) and mulloway (Argyrosomus japonicus) with significant interest in yellowfin bream (Acanthopagrus australis). Applied research is needed, particularly on the major cost areas of diets and feeding (for both fingerlings and grow-out fish) to help ensure profitability and to give farmers and feed manufacturers information so they can make informed business decisions.

Costs of feeds and feeding are usually the largest budget expense for marine fish farms and also significantly affect costs of producing fingerlings in hatcheries. In hatcheries, the global shortage of Artemia and the huge cost of weaning diets has led to a increased priority for better and cheaper live feeds, formulated weaning diets and feeding strategies. For grow-out, most farmers want high-performance, low-cost feeds. Given a choice, most farmers will pay more for diets to achieve better performance but have no real way to make decisions to achieve the most cost effective feeding strategy. There is a clear lack of information for most temperate marine species about the nutritional specifications needed for high performance diets and what physical characteristics are most desirable in the pellets (e.g. should pellets be floating or sinking, how important is pellet hardness, etc). This prevents feed manufacturers providing data-based recommendations about the best diets for farmers and prevents them from formulating and manufacturing specific diets for temperate marine finfish farmed in Australia. Unfortunately, the same lack of information is restricting choices about the ingredients being used in diets. Almost no information exists about digestibility or utilization of most of the ingredients available for use in Australia aquafeeds. Most farmers are aware of “problems” with the use of terrestrial animal protein meals in animal feeds and that use of such ingredients might negatively affect the export market for their fish. However, apart from research with snapper (Aquafin CRC; WA Fisheries) and barramundi (FRDC ADD Subprogram; WA Fisheries) there is no information about digestibility or utilization of Australian ingredients for temperate marine finfish being farmed in Australia. The immediate result of this lack of information is an increase in the proportion of expensive, imported fishmeal being used in diets.

This project will extend the successful research approach adopted for snapper in Aquafin CRC Project 1B.3-2001/208 (Increasing the profitability of snapper farming by improving hatchery practices and diets). In that project, fingerling costs were reduced by approximately 30% through systematic research to develop more cost-effective hatchery procedures including the demonstration of the feasibility of replacing live feeds including artemia with alternative live feeds (copepods) and/or commercially available, inert pellet diets for advanced snapper larvae. Previous work with snapper also demonstrated a major improvement in growth of juvenile snapper when the optimal feeding frequency and day-length were identified. This project seeks to reduce feed costs, to optimise feeding efficiency and to improve fingerling survival and growth of mulloway and yellowtail. Sub-optimal performance of marine fish larvae is often a result of inadequate nutrition or sub-optimal physio-chemical variables during larval rearing. A high percentage of slow-growing or stunted fish in larval rearing runs can seriously reduce economic viability of hatcheries and increase farming costs. The performance of larvae has not been addressed in a systematic manner and although the commercial hatcheries in SA report that fingerling production is not a barrier, there are no published methods of how to optimize production of fingerlings (i.e. to to increase cost-effectiveness of fingerling production). This lack of information will reduce the chance of expanding marine fish farming in NSW and other states in Australia.

Existing grow-out diets used for marine fish such as yellowtail, mulloway and bream are based on generic formulations for “marine fish” (including salmon and barramundi). These diets produce results but it is unknown if current diets are nutritionally adequate, especially for rapidly growing fish. Even basic requirements, like the best protein to energy ratio, are unknown for yellowtail and mulloway. Both low and high energy diets are available for salmon and barramundi but even simple comparisons to find the best of these two “options” have not yet been carried out. There is no reliable information on ingredient digestibility making it impossible for feed manufacturers to confidently formulate diets with alternative protein sources to fishmeal when fishmeal is hard to obtain and when prices are high (and, of course, fish meal prices continue to rise). Research to provide this information is urgently needed.

There are obvious problems with a "one-species at a time" approach to diet development research. This is expensive and takes a long time. This application seeks to conduct specific research with mulloway and kingfish and to build comprehensive models of nutritional requirements for these two species that can be directly compared with other similar models now available for other marine and freshwater aquaculture species (e.g. snapper, sea bream and barramundi).

Fingerling costs for mulloway and kingfish are currently estimated at $0.60->$2.00/fingerling. These represent well in excess of 10% of operating costs. We aim to reduce these costs by as much as 50%. Growout feeds can cost in excess of $2,000/t and with the costs of feeding are usually in excess of 30% of total operating costs (>50% for some operations). Food conversion ratios of in excess of 1.5:1 are regularly reported. We aim to produce diets with FCRs of 1.2:1 with approximately 25% lower ingredient costs. Together these represent the major areas where improvements in production technology can improve the profitability of marine fish farming.