Semporna is best known as the gateway to Sipadan, one of the world’s best dive sites. Now, a new agri-business model is set to bring more big changes over the next few years. The RM2 billion Integrated Lobster Aquaculture Park (iLAP) is expected to transform Semporna’s economy once it is fully operational.
And over the long term, its presence could turn Semporna into a major player in the global seafood industry, in the same way Intel’s first overseas factory in Bayan Lepas turned Penang into Asia’s Silicon Valley. Once Penang started making Intel’s microprocessors, it showcased the resources available in the state to other global technology companies. Once Intel established its foothold in Asia, other technology players soon followed, transforming Penang into a world powerhouse in electronics. Today, exports from Bayan Lepas are in the region of RM20 billion a year.
As Intel spread its operations over the years from a five-acre site in 1972 to over 160 acres now, the partnership between Penang and Intel has brought other spin-off benefits. Intel has established research programmes and laboratories in Universiti Sains Malaysia in not just computer technology but also in materials and mineral research. Intel and other technology companies have industrial placement programmes which benefit USM students.
If the 9,300-hectare iLAP is successful under a joint venture with Yayasan Sabah, Semporna could be to the seafood industry what Penang is to electronics manufacturing. The aquaculture park is a new agri-business model which is expected to revolutionise the global seafood industry.
The total international trade in seafood is more valuable than the global trade in all other animal proteins put together and some 37 percent of world fish production is exported. This makes seafood the most globally traded animal protein.
The New South Wales’ Port Stephens Fisheries Institute forecast that with limited supply from the wild, aquaculture must supply an additional 74 million metric tonnes by 2025. That is more than 40 per cent of current aquaculture capacity. This is why aquaculture is the world’s fastest growing food sector which is expanding at 8 per cent a year.
This demand for seafood has put the world’s fisheries under pressure. Some 75 per cent of the world’s fisheries are fully- or even over-exploited, which means wild catches cannot increase sustainably. And the growing middle class of Asia alone will mean the demand for seafood, especially premium products, such as lobster, will only increase.
In two years’ time, the iLAP will kick off its commercial phase. This new agri-business model is similar to that of the Federal Land Development Authority or FELDA, which created new opportunities for farmers to own smallholdings of palm oil in the 1960s and 1970s. This is the basis for Malaysia’s successful palm oil industry, which has a 45 per cent share of the global market.
Farmers who participate in the iLAP will have a guaranteed buyback from Darden Restaurants Inc, a US Fortune 500 company and the world’s largest owner and operator of full-service restaurants. Darden serves nearly 400 million meals a year in the 1,900-plus restaurants it owns and generates sales of more than USD7.5 billion a year.
This company has developed technology to breed the spiny lobster which is indigenous to Sabah waters. Lobsters grown by farmers will be bought by Darden under the guarantee and initially will be sold to Asian consumers. Eventually, when the iLAP builds up capacity, Sabah’s spiny lobster will also be served in Darden’s restaurants which are currently mainly located in the US.
The key to the iLAP is the clean waters of Semporna and its location which keeps it free from natural disasters. The iLAP is the jewel of the Yayasan Sabah-led joint venture. Through its subsidiary Inno Fisheries Sdn Bhd, Yayasan Sabah has partnered with Nanyang Nexus Sdn Bhd to form Lobster Aqua Technologies Sdn Bhd.
Through Lobster Aqua Technologies, Yayasan Sabah and Nanyang Nexus will develop and manage the iLAP. The joint venture will roll out the infrastructure investment in roads, power supply, jetties and docks.
Nanyang Nexus is itself a joint venture, between Darden and local aquaculture expert Dr Shahridan Faiez. Dr Shahridan is the first Malaysian elected to the Board of Directors of the Global Aquaculture Alliance (GAA), the world’s leading international organisation for aquaculture. Dr Shahridan and his partner Sharizal Shaarani formed Ever Nexus Sdn Bhd, which is Darden’s strategic partner in Malaysia.
The iLAP is expected to hit full capacity in 2029, when it should produce 40 million pounds or about 18,100 metric tonnes of spiny lobster. Sales are projected to be about RM3 billion then.
It will have three cutting-edge hatcheries, where spiny lobsters will be hatched and bred. The hatcheries are the key to the iLAP’s sustainability, producing stocks of lobsters to be grown out to full size. Lobster farms around the world currently catch wild lobsters to be fattened for sale, which puts wild lobster populations under more pressure.
Thanks to the leadership of the government under Chief Minister Datuk Seri Musa Aman, Sabah with its abundant natural resources will be able to tap this lucrative and growing market. In partnership with a global player, US company Darden Industries, the iLAP will be a new model of agri-business which will springboard Sabah into a major seafood player. Semporna can become the Bayan Lepas of the global seafood industry.
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