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Monday, November 30, 2015

30/11/2015: The Aquafeed Interview: Sarena Lin, President, Cargill Feed and Nutrition

First published in International Aquafeed, September-October 2015

One of the biggest buyouts so far this decade, has been the recent acquisition by Cargill of EWOS. This took place in mid-August just prior to one of aquaculture’s largest and most significant events – AquaNor 2015. Negotiations continued into Saturday night, the day before the companies involved headed to Trondheim, Norway, for the bi-annual gathering of the world’s salmon farming industry representatives at the AquaNor 2015 conference and exhibition the following week. Without prior arrangements in place, the companies were able to present their joint agreement, and their commitment to work together for not only the betterment of salmon customers but for the future of all major fish species being farmed for food, to the industry and customers alike.

Ms Sarena Lin, President, Cargill Feed and Nutrition, made the announcement personally at an almost impromptu press conference. International Aquafeed magazine, was in attendance and has taken the opportunity to report here on most of the questions posed to Ms Lin by journalists representing national, regional and world aqua press.  

    

http://issuu.com/international_aquafeed/docs/iaf1505_w1/64

Let me introduce myself. I am the president of Cargill Feed and Nutrition, its absolutely a privilege to be here and to attend this event and to see the interest you all have in this merger. This is a transformative deal. The reason for that is very simple, if you look at Cargill’s feed industry, something you might not realise is that we have been in the feed business for about 100 years of the 150 years of history of Cargill.

And if you think about the knowledge we have developed over the 100 years that started with us being in 37 countries and 17,000 employees with tremendous expertise and knowledge in feed, but most of it in livestock. What we have done though over the last 15-20 years is to enter into the aqua business. Aqua nutrition as we know is one of the fastest growing nutrition sectors in the world. And our involvement in the past has mostly been in warm-water fish such as Tilapia and shrimp.

The reason why EWOS is such a critical partner for us is that we believe this is absolutely the transformative transition we need to have to allow us to really jump start a global presence and harness the technology and skill set that evolved over the years to help us really accelerate the growth in all these other species and all these other markets. That’s the first step and we need to get that done first.

There are other aquaculture feed companies out there, why choose EWOS?
You all know very well that when we talk about aquaculture its not all the same. In aquaculture when you look at species, based on our understanding, salmon is one of the most important species out there; in terms of the requirements from a nutritional perspective, in terms of processing and in terms of transportation. So our belief is, if we want to enter the ‘aqua platform’ in a transformative way why not go for the best? We want to go for the best that we can leverage and transfer that technology. So salmon for us is one of the top choices in terms of being able to build that foundation. To us, this is a no brainer. The cultural fit we had with the EWOS business, their passion and commitment to their customers, the trust they have built and the innovation system they have. We did not see anything like it in all the other companies we looked at.

Now you are moving into the salmon industry, is this a first step for Cargill to move into salmon production, now that seafood is becoming more and more important?
We really need to understand what salmon is about as we know this is a complicated industry. So out first step is, let’s get this deal done, welcome our EWOS friends into the Cargill family and then continue to explore opportunities.

Is vertical integration something you might look at down the road?

Again from our perspective, our first and foremost job is to learn the aquafeed industry and with EWOS’s help to understand what it truly means to be successful in the aquafeed industry. I think that is the first thing we have to learn. Now, obviously, as Cargill Inc. we will always be looking for opportunities for growth, so never say never. However, the practicality is very clear for us in terms of what we need to focus on in the short-term.

In the salmon industry, the feed producers relationships with their users is very close. Do you have that same type of relationship with the users of other livestock feeds you sell? Or are your relationships more at arms length and this is something else you will have to learn?

I think the good news is that in the livestock industry we have very deep relationships with our animal producers. So, no matter what the species, be it dairy, beef or swine especially for the large industrialised producers many of them are our customers we not only deliver feed we also deliver additional service to improve farm management to get better feed efficiency.

But having said that, this is something we are very careful about, we know aqua is a different platform from others; livestock has its own characteristics. Aquaculture is an area we absolutely want to rely on our EWOS colleagues to help us and teach us so we understand the nuances of how to serve customers well and serve them better.

When we talk about feeding nine billion people by 2050, it’s not often thought this will come from the salmon industry, which is seen as a cash crop. With your global reach and the technology and research that has taken place into salmon feed development, how do you see that technology and research being used in the future? Do you feel that can be expanded to other, larger producing species such as Tilapia or Pengasius? Is this on your horizon?
Absolutely, in fact I would say that is exactly the value we see in this partnership. It is that transferability from what EWOS has developed in salmon into these other species to where we see tremendous growth, especially in Asia. From a research point-ofview we are absolutely impressed by Dirdal, EWOS’s research and development centre, and by what EWOS has done in Dirdal. We believe that has to be maintained as a hub for us to deepen our knowledge in aqua. But the job, once we integrate, is how do we take that knowhow and expertise to all these other parts of the world. Remember that there are 37 countries where we already have a strong footprint and where we can go in and use this leverage. This is absolutely in our plan.           

Read the magazine HERE.

The Aquaculturists
This blog is maintained by The Aquaculturists staff and is supported by the
magazine International Aquafeed which is published by
Perendale Publishers Ltd

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