SeaDragon secures supply
Fish-oil company SeaDragon has locked in its supply of shark-liver and liver-oil as it looks to increase production and launch new products.
The listed Nelson-based company this morning announced it had signed a deal with Portuguese company Pescarias Cayon & Garcia LDA that would cover its raw-material supply for the next 12 to 18 months of squalene production.
The supply of shark livers and shark-liver oil would arrive in August and October and again in January next year.
SeaDragon chief executive Ross Keeley said this would allow the company's existing shark-liver refinery to run at capacity for the next year or so.
The quantities would be more than sufficient to cover budgeted production for 2014.
"The agreement locks in raw material supply for the immediate future, overcoming the shortages that have historically constrained the growth of our squalene operations and limited sales activity into new sectors such as cosmetics and pharmaceuticals," he said.
SeaDragon would also launch a new alkoxyglycerol product to the market.
Alkoxyglycerols were found when squalene is removed from shark liver oil, for which there was a growing international market.
Keeley said it would also strengthen the company's position as it prepared to expand its Omega-3 fish-oil activities.
Earlier this year SeaDragon raised $6.1 million, of which $4m would be used to fund the development of a new plant in Nelson able to produce more than 5000 tonnes of refined fish oil and generate annual sales worth up to $50m.
Today's agreement with Pescarias Cayon & Garcia allowed for SeaDragon to get more raw material from the company in the future.
The company said the prices paid for the livers and liver oil were "internationally competitive" and would be linked to the squalene content of the material.