Recirculating Aquaculture Systems: Money Makers or Dream Breakers?

Recirculating Aquaculture Systems (RAS) have captured the attention of the global aquaculture industry, attracting significant funding, but their performance has been variable.

Big Investments, Bigger Questions

Over the past decade, at least $5 billion has been invested in over 150 RAS projects, with $1.6 billion committed in the past two years alone. The majority of this capital has been directed toward large-scale (>10,000-tonne) salmon grow-out systems in the United States, Europe, and the Middle East.

Mixed Results

Concrete production figures are scarce, with most reports referring to theoretical production capacities. Several early pioneers, such as Langsand, Jurassic Salmon, and AquaBounty, have already disappeared without producing considerable volumes of fish. Nordic Aquafarms shifted away from salmon to yellowtail kingfish, while Swiss operator Salmon Lachs has been quiet since August 2023.

Atlantic Sapphire, based in Florida, is one of the few remaining pioneers still in operation, considered a first mover in the sector, and produced 1,545 tonnes in 2023, increasing to 4,400 tonnes in 2024. The company aims to grow 220,000 tonnes annually by 2031. For 2025, the company expects to harvest 8,500 tonnes, which would be accompanied by its first positive EBITA of $1.50 – 2.00 per kg of fish sold. However, the company needs another $94 million to achieve these results, which is on top of the $734 million it has secured on the stock exchange since 2018 and the $187 million in loans it has received since its inception in 2010.

Danish Salmon is another early RAS operator that has been able to survive, harvesting 1,100 tonnes in 2023 and increasing to 2,700 tonnes in 2024, with profits expected to exceed $1.5 million. Fish Farms in Dubai has been operating a 500-tonne capacity facility for several years. Newcomers like Skagen Salmon (Denmark) and Pure Salmon (Poland) are rumoured to have promising early results, but production figures do not seem to be publicly available.

Scaling Expectations vs. Reality

Global salmon production from RAS has risen from near zero in 2020 to an estimated 15,000-20,000 tonnes in 2023 and a maximum of 20,000-25,000 tonnes in 2024. Some industry experts estimate that RAS facilities will contribute 25 percent of all salmon production by 2030, up from the current 1-2 percent.

Profitability Challenges

Most large salmon RAS farms are not currently making money. Making a profit from farming a slow-growing commodity like Atlantic salmon in a global market dominated by low-cost cage producers is very hard. It is made even harder by the risks associated with relatively unproven technology and the need for over $100 million in infrastructure investment. Professor Caroline Engle noted that RAS models were not profitable when all costs were accounted for and that substantial increases in yields would be necessary to make more efficient use of resources to reduce costs to a profitable level.

Why the Investment Mania Continues

Despite limited production results and proof of financial viability, investors remain enthusiastic. The global market for salmon is expected to double in value in the coming years. Wild fisheries for salmon continue to decline, while salmon cage farming operations face pressure to slim down or close. High-tech farming concepts like RAS appeal to institutional investors looking to meet Environmental, Social, and Governance (ESG) goals. The substantial investments required for each RAS project create lucrative opportunities for designers, builders, suppliers, consultants, marketers, and early investors.

Alternative Investments

For the billions of dollars invested in salmon RAS units, there is little to show in terms of output or profitability. A similar investment in pond-based tilapia or pangasius farming could have increased production capacity fourfold. A $5 billion investment could have made a difference in terms of sustainability, food security, and employment if invested in offshore Seriola farming in the Mediterranean, or in tilapia farming using HDPE ponds with partial water recirculation in sub-Saharan Africa or South America.

Looking Ahead

Although RAS has made a few dreams come true, change is coming. The second generation of industry players has learned valuable lessons from early pioneers, resulting in improved farming concepts. The next chapter for RAS will likely revolve around whether these farms can scale up production to provide the promised financial returns and whether RAS can transition from a niche innovation to a mainstream, replicable system capable of replacing traditional cage farming.