Aquaculture Leases

If elected in March 2018 a Marshall Liberal Government will modernise legislation governing aquaculture production to support the growth of the industry.

The Opportunity

Aquaculture is an important part of South Australia’s well established and highly developed seafood industry. We have the most diverse range of aquaculture in Australia, including subtidal and intertidal mollusc farming, sea-cage farming of finfish and a range of land based operations.

More than 80% of marine life in southern Australian waters is found nowhere else in the world.

The aquaculture sector provides high value niche products, particularly Southern Bluefin Tuna, oysters, mussels and abalone. Latest figures show an annual output from aquaculture of more than $180 million for domestic and export markets.

Demand far outweighs supply for South Australian seafood from the nutrient-rich waters of the Southern Ocean and there are immediate investment opportunities for further commercial development of under-utilised species.

Marine based aquaculture sites must have a licence and a lease from the South Australian Government. A licence describes the activity that can be undertaken and the lease grants the exclusive use of an area of water for marine aquaculture.

The capacity of aquaculture operators to expand their businesses largely relies on their ability to borrow against their existing assets.

However, the current structure of aquaculture leases prevents existing leases being used as security.

Oyster growers alone estimate that removing this limitation could treble their annual output to $100 million.

The State Liberals' Plan

If elected in March 2018 a Marshall Liberal Government will modernise legislation governing aquaculture production to support the growth of the industry.

Specifically, a Liberal Government will legislate to:

  • Extend the period of a production lease from 20 to 30 years
  • Prescribe that an interest holder in a mortgage will be privy to the same lease notification requirements as the principal mortgagee

These changes have been identified following our consultation with the aquaculture sector and lending institutions, and we will continue to work with key stakeholders in finalising these reforms.

The current 20 year duration of production leases limits the amount of longer term finance operators are able to secure.

In circumstances where a Minister may consider cancellation of a lease, there is a requirement to notify the lessee first of an intention to do so. Lending institutions as third party interest holders have requested that they be given the same notification to enable them to assess options prior to any formal cancellation.

These measures would make aquaculture leases a more attractive security to lending institutions.

A Liberal Government will also continue consultation with aquaculture operators to identify any other action that may help to encourage further growth of their industry.

Part of our plan for SA