A collaboration between Murray Cod Australia (ASX: MCA) and the CSIRO that commenced in 2021 is yielding positive results for the aquaculture company that is breeding fish up to 80% larger through a selective breeding program to enhance food supply and commercial production efficiency.
Ross Anderson, CEO of Murray Cod Australia, said, “Our selective breeding program with CSIRO marks a critical step forward in our commitment to sustainable growth and product quality. These findings underscore our dedication to innovation and excellence in aquaculture.”
Based in New South Wales, Murray Cod Australia is a sustainable aquaculture business. By replicating natural habitat for open pond fish, they raise premium best-tasting cod available catering to discerning consumers seeking sustainable seafood options.
MCA has made strides in both domestic and international markets, as a premier provider of high-quality Murray Cod. Internationally, MCA has expanded its distribution network to prestigious venues such as 5-star hotels and Michelin-star restaurants in Singapore and Malaysia. Sales to Hong Kong surged by up to 40% in the March 2024 quarter, with initial demand also observed in Vietnam and Indonesia, where premiums over domestic prices underscore the product’s luxury status.
Meanwhile, MCA has reported growth driven by increased fish biomass and availability of larger fish weighing over 2.5kg locally. Despite limited presence in Australian supermarkets, domestic sales prices have risen by over 24% since October 2023, demonstrating consumer demand for their premium products. MCA is actively working to establish a market for smaller fish (800g-1.2kg) and is set to resume sales in Western Australia, to further expand their market reach and product offerings.
MCA acquired the Stanbridge site in Dec 2023, and progress at the Stanbridge site’s free-range grow-out ponds project received approval for 78 ponds with an expected stocking of 28 ponds by March and April 2024. This method avoids costly pen infrastructure, saving around $250,000 per pond in capital expenses, while also cutting fuel usage, construction time, and ongoing operational costs related to energy, labour, and maintenance.
In a separate development, MCA is exploring a potential sale and leaseback of key assets including hatcheries, nurseries, grow-out facilities, and water assets. This strategic move is aimed at optimising capital utilisation and enhancing operational flexibility. To facilitate this transaction, MCA has engaged the expertise of LAWD’s Agribusiness Transaction Team and Blackpeak Capital, ensuring a structured and beneficial approach.
Furthermore, MCA has seen advancements in their larval weaning method, which expanded to cover 60% of spawning operations in 2023, up from 20% in 2022. This method increased juvenile production and enabled earlier larval weaning stages. With less physical space required than traditional methods, this boosts capacity by up to 10 times from the same area.
In the March 2024 quarter, MCA reported a 6.2% increase in the average weight per fish sold, enhancing product value and profitability despite a 24% rise in wholesale prices driven by Southeast Asian demand.
For the March 2024 quarter, MCA reported $3.7m in cash receipts which represented a 44% increase on the December 2023 quarter. This resulted in $2.9m negative operating cash flow which took their 9 months YTD operating cash out flow to $11.2m.
As of 31 March 2024, the Company had $11.3 of cash on hand before raising $20.4 million in May 2024 at an Offer Price of $0.07 per New Share.
Sidra is a Business Writer with The Sentiment
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1 Comment
Shraddha13
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