Beyond a Billion Iwi in Aquaculture 2025 Risks and Opportunities

1. Beyond a Billion Iwi in Aquaculture 2025 Risks and Opportunities Aquaculture New Zealand Conference 2009 Aquaculture New Zealand Ahumoana Aotearoa Whakatu, 4 Whiringa a Rangi 2009

2. Agenda Beyond a Billion Iwi in Aquaculture 2025 Risks and Opportunities • Mihi Whakatau • Chair – Harry Mikaere • Proposed Law Reforms • Iwi Aquaculture Experiences • Hauraki • Wakatu • New Zealand King Salmon/Te Ati Awa • Māori Economic Development Taskforce • National Māori Aquaculture Strategy • Next Steps

3. Proposed Law Reforms • Government has signalled strong support for Aquaculture • What’s happened? • Resource Management Act Amendments • Aquaculture Amendment Bill # 2 • Māori Commercial Aquaculture Claims Settlement Amendment Bill

4. Fundamental Reforms • Joint work with Industry, Iwi, and Government • Independent Review by LECG • Technical Advisory Group (TAG)

5. Fundamental Reforms • What will not change • UAE will be retained • Integrity of Fisheries and Aquaculture Settlements protected • Regional Focus for settlement • Aquaculture development likely to increase • Likely to be streamlined/faster process • Foreshore and Seabed

6. Fundamental Reforms • What will change • Aquaculture development likely to increase • Likely to be streamlined/faster process

7. Implications for Iwi • Aquaculture will grow • Aquaculture has a target of $1b by 2025 • Potential is even greater • Opportunities to apply for new space • New Species • Need to be prepared – first up best dressed • Passive or Proactive investment • Commercial and/or cultural priorities and outcomes

8. Implications for Iwi • Māori Commercial Aquaculture Claims Settlement Act • Māori will still get 20% of new space • Regional Focus • Need to consider how will deal with regional settlements • Developing space allocated under settlement will require capital • Consider now what stake you want in aquaculture? • Keeping engaged with the policy development process

9. Implications for Iwi • Ongoing policy/legislation development • Aquaculture reforms • Settlement Agreements • Wider RMA Reforms (natural resource management, including water) • Emissions Trading • Foreshore and Seabed • Iwi need to be engaging strategically across all natural resource management issues

10. Aquaculture – the Hauraki Experience • Now have involvement with over 320 ha of mussel farm space in Hauraki Gulf • Didn’t start at this – original 17 hectares in 1986 (under MFA 1971) • Original balance sheet $450K and now $30M • Employment – significant change over 25 years • Now have approx 25+ directly involved on farms • Now also have 160 employed in processing for about 8 months per year • Regional economic development and prosperity

11. Aquaculture – the Hauraki experience Why we entered into aquaculture • Concerns about inshore fishstocks in late 70s and early 80s • Kaumatua recommended that aquaculture be investigated -What cost, what skills, who hold • Agreed to begin commercial company – Tikapa Moana Entreprises Ltd – owned by 11 marae • Gain consent - took 3-4 years • Iwi also entered through its own company Tai Moana Marine Farms Ltd

12. Aquaculture • Recognise what business you are in • Aquaculture is NOT fish • at its most basic level for iwi, Settlement quota is an asset and there is an ability to immediately sell ACE that only requires detailed work for a small part of the year, & fishers can fish in a range of places • Aquaculture on the other hand starts as a liability that requires considerable capital input to 1st harvest (approx $75K / ha in Hauraki) • Aquaculture is site bound and the farm must be managed 24 / 365 • Aquaculture development is generally cash constrained

13. Hauraki experience • Why not just develop original area? • Scale : unable to make progress without greater areas • Getting space • RMA ‘One stop shop’ slow, as Council did plans but concerns about ‘gold rush’ • Group A took 8 years • Group B 16 years and counting • moratorium STOP shop • Aquaculture reforms STILL STOP • Aquaculture Settlement 20% of past – now settled, 20% of new – nil yet, but 104ha soon

14. Hauraki Going farming • Need to know what technically is required for environment • Eg needed change in Anchors and backbone design in going from inter-tidal to out in Gulf • Need to have spat • Fouling – different seasonal growth • Closures – biotoxins eg algae blooms red tide, PSPs • Need to have approvals to be able to sell product ie testing to meet USFDA and EU standards: testing for at least 2 years

15. Hauraki Joint Ventures • Too costly to go alone – either in expense or time in making mistakes • Learn from others experience • Need to have JVs / Partnerships with others • partner must fit with iwi – short, medium and long-term • must have comprehensive understanding of industry • Need to be explicit so no surprise and clear responsibilities

16. Hauraki • Need Capacity - both onshore and offshore • Need barges , wharves and depots • Need heavy trucks to move from shore to processor • Need adequate roading infrastructure • All this means extensive ongoing dialogue with Councils and communities re infrastructure

17. Hauraki – selling your product • Need to know terms of trade with processors • Need to recognise that this reflects international prices that reflect both demand and NZ$/US$ • Last year $1050/ tonne but this year $650/tonne • Probably need long average to be $725 to break even

18. Hauraki – where to from here? • Current propose to merge the iwi / marae companies with retained shares of ownership • Looking to develop further through Joint Ventures with others in further marine farming products

19. Hauraki – key lessons • Do your planning – work through all the details and timing associated with each aspect • Get some robust financial analysis so aware of what is required • Set up explicit joint venture/ partnership arrangements • Talk and work with Councils on providing necessary infrastructure

20. National Māori Aquaculture Strategy • Māori control around 35% of industry already • Collective Political leverage (with Government and Industry bodies) • Growing investment through both active investment and settlement assets • Potential to capture greater returns across value chain – production to market • Build economies of scale • Research and Development – Primary Growth Partnership • New Species development – commercial and cultural • Indigenous Branding (including wider Māori industry?)

21. Next Steps • Iwi Māori expectations of AQNZ, TOKM, te mea • Where to from here – continuing the conversation and delivering outcomes • Minister of Māori Affairs visit to Coromandel next week • TOKM workshop 26/27 November • Facilitating input into policy development • Aquaculture (including TAG response) • Wider RMA/natural resource management • ETS • Foreshore and Seabed • Māori Fisheries Conference April 2010 • Keeping connected