Economic Impact Studies
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Northern Ontario Aquaculture Association
In October 2006, the Northern Ontario Aquaculture Association (NOAA) initiated a study to
examine the economic impacts of the cage culture industry in Ontario. A key objective of the study
was to measure the economic impact of the cage culture industry through an analysis of direct and
indirect economic benefits to the local and provincial economy.
The direct economic impacts (sales and jobs) associated with the Ontario cage culture industry
were identified through a review of secondary data and key informant interviews with cage culture
operators while the indirect economic impacts (sales and jobs) were identified through a survey of
'aqua-related' businesses that provide goods and services to the culture operators. Unlike
forestry, mining and agriculture, the aquaculture industry is a relatively new economic sector in
Ontario. Lake based cage culture operations were established in the mid-late 1980's and have
since come to represent the dominant production system in Ontario in terms of total fish
production. Rainbow trout is the main fish species produced by the 7-8 cage culture operators in
Ontario with most of these operations located in northern Lake Huron. The cage culture industry
makes an important contribution to community and regional economies in Ontario. In terms of
direct benefits, Ontario cage culture operators produced a total of 3,275 tonnes of rainbow trout in
2005 which had a total farm gate value of $12.5 million. The total employment associated with this
production activity amounted to 50 full-time equivalent jobs.
With respect to the indirect impacts, cage culture industry linkages with local and regional suppliers
of goods and services generate significant economic benefits across a range of industry sectors
including manufacturing, retail and wholesale trade, construction, transportation, and business
services. The results from this study indicated that these businesses generated an estimated $38.2
million in cage culture related sales and sustained a total of 179 full-time equivalent jobs.
Collectively, cage culture operators and the businesses they deal with generated a total of almost
$51 million in sales and supported 229 full-time jobs. This includes a substantial number of jobs in
the value added sector with two major processing facilities located in Ontario.
The study determined that the cage culture industry sustains employment in numerous Northern
Ontario communities including Little Current, Espanola, Manitowaning, Kagawong, Gore Bay,
Mindemoya, Evansville, Val Caron, Parry sound , Sudbury and North Bay. The bulk of this
employment activity is linked to service, cage fabrication and maintenance supplies and service,
construction/building materials, and processing. All of the cage culture production jobs and at
least 30% of the indirect jobs related to cage culture production are located in Northern Ontario.
The cage culture industry is also providing employment in a number of communities in Southern
Ontario including Hanover, Fergus, Guelph, Kitchener, New Hamburg, St. Thomas, Woodstock,
Holland Centre, Dunnville, Embro, Elmira, New Dundee, Shelbourne, Coburg and Toronto. The bulk
of this employment activity is linked to businesses that are providing fish feed supplies, fingerlings
and processing.
The Ontario cage culture industry also sustains a small number of jobs in the Atlantic provinces
where several fish feed suppliers and netting and rigging suppliers are based.
The economic multipliers associated with the Ontario cage culture industry are substantial. The
study determined that the cage culture industry has an employment multiplier of 4.5 and a sales
expenditure multiplier of 4. These multipliers suggest that every job in cage culture production
sustains an additional 3.5 jobs in the wider economy while every dollar in farm gate sales
generates an additional 3 dollars in the wider economy. Using slightly more conservative
multipliers and assuming a 10% annual increase in production it is estimated that the Ontario cage
culture industry could be producing as much as 8,400 tonnes of rainbow trout in 10 years. The
direct on-farm employment associated with this production would amount to approximately 130
full-time equivalent jobs with a further 389 full-time indirect jobs sustained in the wider economy.
In terms of sales, the total annual farm gate receipts at the end of the 10th year of production
would amount to almost $34 million with a further $84 million in indirect sales related to
businesses that deal with cage culture operations.
Cage culture operators and the businesses they deal with identified a number of industry
strengths. A key strength relates to the experience and resourcefulness of the cage culture
operators and industry stakeholders who helped build the industry from the ground up over a
short span of 20 years. The commitment of operators to engage and take the lead in science based
research and development initiatives was also cited as an important feature of the industry.
Operators are passionate about seeing the industry succeed and believe the industry has
considerable potential for future expansion. Aqua-related businesses strongly support the
expansion of the cage culture industry and believe Ontario has substantial bodies of fresh water to
accommodate further growth. Industry stakeholders also recognize the importance of the industry
in supporting small businesses in Northern Ontario and providing stable employment in rural
communities.
In terms of challenges, the key issue as identified by cage culture operators and the businesses
they deal with is the lack of functional government regulations and guidelines which is preventing
cage culture operations from expanding existing sites and accessing new sites. With the Ontario
cage culture industry being "held back" operators believe that competitors from other regions of
Canada and international producers are gaining a competitive advantage.
There is also concern that regulatory bodies are being misinformed and influenced by special
interest groups such as environmental activists. Industry stakeholders would like to see objective
science based regulations as the only standard used for determining policy and guidelines. Cage
culture production represents a first generation industry in Ontario and operators feel they have
not been adequately recognized for the substantial work and research they have undertaken to
establish the industry over the last 20 years while complying with all of the regulations.
This study has found that the cage culture industry in Ontario produces important economic
benefits for rural communities across Ontario including many communities in Northern Ontario. The
industry is productive and entrepreneurial. It has also demonstrated its ability to diversify local
economies and provide stable employment. The industry has even grater future economic potential
for Ontario and the province possesses considerable freshwater resources for supporting the
expansion of the industry. For the cage culture industry to thrive and maintain its economic
viability, regulatory agencies will need to make a strategic commitment to address institutional
barriers and enable its future growth.
Read more....
examine the economic impacts of the cage culture industry in Ontario. A key objective of the study
was to measure the economic impact of the cage culture industry through an analysis of direct and
indirect economic benefits to the local and provincial economy.
The direct economic impacts (sales and jobs) associated with the Ontario cage culture industry
were identified through a review of secondary data and key informant interviews with cage culture
operators while the indirect economic impacts (sales and jobs) were identified through a survey of
'aqua-related' businesses that provide goods and services to the culture operators. Unlike
forestry, mining and agriculture, the aquaculture industry is a relatively new economic sector in
Ontario. Lake based cage culture operations were established in the mid-late 1980's and have
since come to represent the dominant production system in Ontario in terms of total fish
production. Rainbow trout is the main fish species produced by the 7-8 cage culture operators in
Ontario with most of these operations located in northern Lake Huron. The cage culture industry
makes an important contribution to community and regional economies in Ontario. In terms of
direct benefits, Ontario cage culture operators produced a total of 3,275 tonnes of rainbow trout in
2005 which had a total farm gate value of $12.5 million. The total employment associated with this
production activity amounted to 50 full-time equivalent jobs.
With respect to the indirect impacts, cage culture industry linkages with local and regional suppliers
of goods and services generate significant economic benefits across a range of industry sectors
including manufacturing, retail and wholesale trade, construction, transportation, and business
services. The results from this study indicated that these businesses generated an estimated $38.2
million in cage culture related sales and sustained a total of 179 full-time equivalent jobs.
Collectively, cage culture operators and the businesses they deal with generated a total of almost
$51 million in sales and supported 229 full-time jobs. This includes a substantial number of jobs in
the value added sector with two major processing facilities located in Ontario.
The study determined that the cage culture industry sustains employment in numerous Northern
Ontario communities including Little Current, Espanola, Manitowaning, Kagawong, Gore Bay,
Mindemoya, Evansville, Val Caron, Parry sound , Sudbury and North Bay. The bulk of this
employment activity is linked to service, cage fabrication and maintenance supplies and service,
construction/building materials, and processing. All of the cage culture production jobs and at
least 30% of the indirect jobs related to cage culture production are located in Northern Ontario.
The cage culture industry is also providing employment in a number of communities in Southern
Ontario including Hanover, Fergus, Guelph, Kitchener, New Hamburg, St. Thomas, Woodstock,
Holland Centre, Dunnville, Embro, Elmira, New Dundee, Shelbourne, Coburg and Toronto. The bulk
of this employment activity is linked to businesses that are providing fish feed supplies, fingerlings
and processing.
The Ontario cage culture industry also sustains a small number of jobs in the Atlantic provinces
where several fish feed suppliers and netting and rigging suppliers are based.
The economic multipliers associated with the Ontario cage culture industry are substantial. The
study determined that the cage culture industry has an employment multiplier of 4.5 and a sales
expenditure multiplier of 4. These multipliers suggest that every job in cage culture production
sustains an additional 3.5 jobs in the wider economy while every dollar in farm gate sales
generates an additional 3 dollars in the wider economy. Using slightly more conservative
multipliers and assuming a 10% annual increase in production it is estimated that the Ontario cage
culture industry could be producing as much as 8,400 tonnes of rainbow trout in 10 years. The
direct on-farm employment associated with this production would amount to approximately 130
full-time equivalent jobs with a further 389 full-time indirect jobs sustained in the wider economy.
In terms of sales, the total annual farm gate receipts at the end of the 10th year of production
would amount to almost $34 million with a further $84 million in indirect sales related to
businesses that deal with cage culture operations.
Cage culture operators and the businesses they deal with identified a number of industry
strengths. A key strength relates to the experience and resourcefulness of the cage culture
operators and industry stakeholders who helped build the industry from the ground up over a
short span of 20 years. The commitment of operators to engage and take the lead in science based
research and development initiatives was also cited as an important feature of the industry.
Operators are passionate about seeing the industry succeed and believe the industry has
considerable potential for future expansion. Aqua-related businesses strongly support the
expansion of the cage culture industry and believe Ontario has substantial bodies of fresh water to
accommodate further growth. Industry stakeholders also recognize the importance of the industry
in supporting small businesses in Northern Ontario and providing stable employment in rural
communities.
In terms of challenges, the key issue as identified by cage culture operators and the businesses
they deal with is the lack of functional government regulations and guidelines which is preventing
cage culture operations from expanding existing sites and accessing new sites. With the Ontario
cage culture industry being "held back" operators believe that competitors from other regions of
Canada and international producers are gaining a competitive advantage.
There is also concern that regulatory bodies are being misinformed and influenced by special
interest groups such as environmental activists. Industry stakeholders would like to see objective
science based regulations as the only standard used for determining policy and guidelines. Cage
culture production represents a first generation industry in Ontario and operators feel they have
not been adequately recognized for the substantial work and research they have undertaken to
establish the industry over the last 20 years while complying with all of the regulations.
This study has found that the cage culture industry in Ontario produces important economic
benefits for rural communities across Ontario including many communities in Northern Ontario. The
industry is productive and entrepreneurial. It has also demonstrated its ability to diversify local
economies and provide stable employment. The industry has even grater future economic potential
for Ontario and the province possesses considerable freshwater resources for supporting the
expansion of the industry. For the cage culture industry to thrive and maintain its economic
viability, regulatory agencies will need to make a strategic commitment to address institutional
barriers and enable its future growth.
Read more....
| Executive Summary |
| Prepared by: Harry Cummings & Associates Inc. |
| "Environmentally Responsible, Environmentally Accountable" |
