The company told FeedNavigator it was investing “up to $50m” in the new feed mill, and that it had secured $2m of grant funding through the Office of the Coordinator General under the Business and Jobs Attraction Initiative - a package created by the Tasmanian government to attract business and jobs to the region.
According to Ridley, Australian producers have indicated that salmon production is growing in the vicinity of 10% year on year. The company said its investment in the new feed mill would enable it to support this customer growth.
“Ridley’s commitment to a new state of the art feed mill in Tasmania supports our focus on growing with our customers, which is on the back of sustained aquaculture production growth in the region,” said Ridley’s managing director and CEO Tim Hart.
The feed mill will primarily supply the Tasmanian salmon industry as well as other aquaculture species on mainland Australia and New Zealand.
On stream in 2019
Ridley has secured a site in Westbury, northern Tasmania, and said it is working to obtain the necessary planning approvals to commence construction of the new mill in 2017, with completion expected early 2019.
“The site secured at Westbury has close proximity to our customers and is strategically located from a logistics and raw material supply perspective,” explained Hart.
Ridley currently supplies significant volumes of feed into the Tasmanian market from its Narangba facility, near Brisbane in Queensland. It said that opening a facility in Tasmania would benefit its customers through “reduced supply chain costs and shorter lead times”.
"It will also allow Ridley to collaborate more closely with customers on new product development and dietary enhancements,” said the company in a press release.
Room for growth
The capacity of the mill will be approximately 50,000 tons per year, working on a five-day shift structure. Committed volume from existing contracted customers will enable the proposed mill to meet internal financial return targets, whilst spare capacity will be available to meet demand from of new and returning customers and general industry growth, said Ridley.
It said the transfer of salmon feed production from Narangba to Tasmania would be accommodated by a restructure on commissioning of the new feed mill. This restructure will include the return of production of certain third party manufactured products that are currently outsourced due to capacity constraints.
Tasmania is the largest producer of fishery and aquaculture products in Australia, with the farm gate value of the salmon industry alone worth over half a billion dollars per year.
Ridley confirmed that salmon industry growth rates are forecast to remain strong into the foreseeable future, with the cold waters making Tasmania the only region in Australia suitable for the cultivation of the salmon biomass.