Sealord calls it quits on mussels

01:18, May 11 2012

Sealord Group is selling its last few South Island mussel farms and closing its Tahunanui factory, bringing down the final curtain on what was once the biggest mussel operation in the South Island.

All 50 workers – 10 operating the farms and 40 at the Beatty St factory – are being offered new roles within Sealord.

The company announced this morning that it wanted to focus more on its core fishing business.

However, it still has 270 mussel lines in the Hauraki Gulf, a one-third share in a mechanised mussel processing plant in Tauranga and trout, salmon and barramundi aquaculture interests in Australia.

Sealord aquaculture general manager Dorje Strang said the decision, which follows the bombshell loss of 323 jobs at Beatty St in 2008, was not because the surviving South Island operation was unprofitable.

At one point Sealord Shellfish had 50 mussel farms in the top of the south, mainly in the Marlborough Sounds.


"The business is solid," he said. The Nelson-based fishing and fish processing business was "poised for a reasonably strong period of growth" and Sealord had made a pragmatic decision to release capital by getting out of mussels in the top of the south.

He said there was strong interest in the 10 Golden Bay and Tasman Bay farms, but the large factory had been on the market for 12 months without attracting buyers. It was expected to close at the end of September.

The move had been discussed with the remaining shellfish staff for some time and he had a good reception when he broke the news yesterday. They were a fantastic, hard-working team, Mr Strang said.

"It's been a big decision.

"We've put a lot of work into making sure that we can look after all our staff."

After the 2008 layoffs the factory stopped production of mussels on the half-shell, but that had resumed due to changing markets. Its current production was 7000 tonnes, mainly for the European and Asian markets, he said.

The closure decision also places a question mark over the $50 million SPATnz partnership based at the Cawthron Institute's Glen Aquaculture Centre.

Last year Sealord, listed seafood company Sanford and Wakatu Incorporation were given $23.6m in government primary growth partnership funding over seven years to selectively breed mussel spat on a commercial scale.

The partners were required to match that funding.

Asked about Sealord's status in SPATnz, Mr Strang said the group was still a shareholder "at the moment".

"We are in a process we're working through with the other shareholders. If you haven't got mussel farms, then it's not likely you're going to need an investment in selective breeding."

However, Sealord's North Island mussel business was "in a growth phase". Sealord had 10 farm workers and the factory it jointly owned with Sanford and Greenshell Investments employed 160, he said.

That factory has 28 automated mussel-opening machines that can each process up to 3600 mussels an hour – more than 1.6 million in a 16-hour day.

In December Sealord reported a 13 per cent lift in net profit to $20.6m on revenue of $573.5m over 15 months.

At that time chief executive Graham Stuart said there had been a "much-needed" firming in mussel prices, offset by a weak United States dollar and a barnacle infestation on North Island mussel lines.

Aquaculture New Zealand chairman Peter Vitasovich said Sealord had made the choice to wind down its top of the south mussel business some years ago and today's news was "probably just the final stage of that process".

He said the mussel industry was experiencing strong demand and prices, with the high New Zealand dollar its only serious problem.

The Nelson Mail