Steely determination

When the Fish Farmer team visited Kames’ headquarters in Kilmelford, the west coast of Scotland had just seen several days of heavy rain. The water in the hatchery tanks, normally clear, was as dark as whisky thanks to peat washed down from the hillside.

It was a reminder that a farm is never separated from its natural environment, and for a farm to be sustainable it must be able to work in harmony with nature.

2022 is a big year for Kames Fish Farming, marking 50 years since Stuart Cannon – who is still Chairman – co-founded what is now Scotland’s largest independent, family-owned fish farm.

In an industry dominated by salmon, Kames produces steelhead trout. Described as “the rainbow trout that migrates to the sea”, steelhead may not have the name recognition among consumers that salmon has, but spend any time with the team at Kames and you will soon be an advocate for this close relative that is, arguably, both more robust and more delicately flavoured (see sidebar, page 56).

Of course, Kames threw a party to celebrate 50 years of success in a challenging industry, with a ceilidh and the company’s own version of the Highland Games. But even more importantly, the team is looking ahead to the next half century.

Kames employs around 60 staff and produces around 3,000 tonnes of steelhead trout annually, less than a tenth of the production of Scotland’s biggest salmon farmer, Mowi. The company has six seawater sites (five along the west coast and one off the Isle of Skye) and five freshwater cage sites, plus three hatcheries.

The fish are mainly processed at the Loch Duart processing plant in Dingwall, in the north of Scotland. Some of the fish are destined for the restaurant trade, some for retail or sale direct to the public, and some go to smokehouses – steelhead makes for a firmly textured and tasty smoked fish.

The Kames hatchery at Kilmelford

What is steelhead trout?

Kames produces steelhead trout – but what is it? “Steelhead” is the seagoing form of the rainbow trout Oncorhynchus mykiss, a species native to the Pacific coast of North America.

As Kames’ Neil Manchester explains: “Steelhead is the rainbow trout that migrates to the sea.”

Kames prefer this designation to “sea trout”, as that is more commonly applied to native British brown trout that migrate to sea. These are the trout, Salmo Trutta, commonly caught by anglers at sea.

As an anadromous fish, the steelhead lifecycle is very similar to that of the salmon. In the wild, the fish hatch and grow in fresh water before swimming out to sea as smolts to forage and grow to full size, before returning to rivers to spawn.

There are differences – for example, the physical differences rainbow trout go through in smoltification are less profound than they are for salmon.

As Manchester explains: “It’s more about tolerating salt water than the full physiological adaptation that salmon go through.”

Not all rainbow trout thrive in the sea, and a key element in Kames’ broodstock programme has been to develop a strain of trout that do well in this environment.

“Steelhead” is a core brand for the company, but restaurants will often describe it as “sea trout”, while it can be found in some supermarkets under the name “loch trout”.

In Tasmania, farmed steelhead is referred to as “Tasmanian ocean trout”. Loch Etive Trout, part of the Dawnfresh Group, appears to use the term “steelhead” when marketing to North America, but not in the UK.

Steelhead trout does not quite carry the price premium of salmon, but it has a delicate flavour, excellent texture and is less fatty – while still being rich in healthy omega-3 oils.

Maciek Szymik, Executive Chef at Edinburgh’s New Chapter restaurant, says of steelhead: “[It] has a great, subtle flavour, a delicate texture and is not quite as popular as salmon, so it inspires more creativity. It also helps that it is great value for money at the moment.”

As Szymik explains: “’Sea trout’ is the name our customer would recognise. Adding ‘steelhead’ to the mix would definitely spark extra questions, which wouldn’t necessarily be a bad thing. I’m guessing whether the name catches on is probably dependent largely on how it’s marketed to the end consumer.”

Award winners

In May this year, at the UK Aquaculture Awards, Kames was named Best Aquaculture Company and its Fish Health Manager, Andre Van, was joint winner of the Rising Star award. Kames’ product has been recognised too. For example, it was highly commended in the Great British Food Awards in the Fresh Fish & Seafood category, where Mitch Tonks – one of the judges – said: “Sea trout are magnificent fish and superior to salmon in my eyes. It’s really great to see them raised in lochs like this.”

The company is not resting on its laurels, however. Neil Manchester, who succeeded Stuart Cannon as Managing Director last year, has been given an ambitious brief to double the size of the company in the next five years, to create the critical mass that will see it stepping into the next 50 years.

The long-term strategy – which the company calls “Future50” – will, Manchester says, be based on Kames’ core values: quality, sustainability and community. And, he stresses: “It starts with our people.”

Andre Van, Fish Health Manager, Kames

Recruiting the best talent is a key aim. Kames’ awards success has made a noticeable difference, Manchester says, in attracting excellent people to a branch of the industry that has sometimes been seen as salmon’s poor relation.

With all sites fully staffed, Kames is now focusing on retention, which includes maintaining the “employer brand”. As Manchester puts it: “We want everyone to continue to be proud to work for this company.”

Branding for the product is also critical. Part of the Future50 initiative has been refreshing the brand, including a new logo and website.

Marketing Manager Cate Cannon explains: “We started with our values and we aimed to create the logo and branding around that. The logo speaks to Scotland and the sea, the round shape is a nod to the cage concept, and we kept the colours fresh and bright. We wanted it to feel quite modern.”

The “quality” message for customers is not just about the quality of the product – it’s also about quality and reliability of service, Manchester stresses, with the company winning some contracts because other providers had failed to deliver.

The campaign also involved the launch of a new directly marketed product range. Cate Cannon says: “When you’re trying to market something quite unique, it’s great if you can just directly show people, just give them a pack and let them take it home and try it. It quickly wins support from customers – from wholesalers to chefs to the end consumer – when they taste what we’re talking about.”

To overcome the challenges of online ordering, Kames is partnering with Fishbox, which specialises in delivering chilled, fresh seafood.

Neil Manchester, MD with Kames

Bold ambitions

So far, so good, but how will the team go about doubling the size of the company? It starts with increasing profitability, in addition to keeping to the core values, Neil Manchester stresses.

He says the key areas in which Kames is investing to achieve this are breeding, technology, efficiency, innovation and facilities.

Kames already has its own broodstock, developed with years of experience. Not all trout take well to the saltwater environment and the development of a hardy strain has been crucial to the company’s success.

Now, Kames is formalising and developing that process with the help of genetics specialists Xelect, based in St Andrews. With a demand for around two million eyed eggs each year and a three-year cycle before improvements bring material benefits, it’s a challenging task but Manchester’s background – he previously held a senior international role with Hendrix Genetics – certainly helps.

In terms of technology, Stuart Cannon has always been an innovator but the pace of change, Manchester believes, needs to pick up even further. His concept is “salmonisation” – learning the lessons from the salmon industry and applying them to steelhead trout.

This will include, for example, increasingly sophisticated underwater cameras to track what is happening below the surface. This has already started, but the next generation of devices should enable staff at a central location to keep track of fish behaviour, uneaten food and so on while staff at the site can get on with day to day husbandry.

Investment in facilities and vessels is also critical, and Kames recently took delivery of a new vessel from Coastal Workboats. The company’s main site on land at Kilmelford is a collection of functional, but elderly buildings, some of which date back to a seaweed processing plant built in the interwar years, and which also includes a fish health lab, equipped by Andre Van, set in a shipping container. In the near future, it could look very different.

Manchester says: “We want our headquarters in Kilmelford to be seen as the centre of excellence and innovation for steelhead trout farming in Scotland.”

All of this will also depend on Kames working with its supply chain – such as Cargill, its main feed supplier (also, the Kames farm in Skye is supplied by Mowi’s feed arm and Kames are also trialling feed from BioMar); RSPCA Assured, which audits animal welfare; Aquatic Vets and Wellfish Diagnostics, which help manage fish health; Pharmaq, which provides vaccines; Boris Nets, W&J Knox and Feorlig Marine, which supply and clean the nets; haulage business D&J Campbell; and technology suppliers such as ScaleAQ, Sterner Aquatec and Gael Force.

Kames is also audited to Global GAP standards and by Quality Trout UK (QTUK).

Even within its existing licences, Kames could take production to over 4,000 tonnes. Expanding further could be a challenge, however. It is no secret that, like everyone else, the company is looking with interest at the sites operated by Dawnfresh, another trout farmer, which is now in administration and looking for a buyer. Deep-pocketed salmon companies are also eyeing up the target, however.

Gaining permission to set up a new site at sea is expensive and time-consuming, and land-based recirculating aquaculture systems (RAS) facilities would be prohibitively costly, but Neil Manchester is looking with interest at semi-closed cage systems.

The key breakthrough, Manchester argues, will come when the cost of semi-closed cages – which are still largely in the prototype stage – comes down, and when there is an economical way to collect waste from the bottom of the cage. Viable uses for the recovered waste, such as biogas production, will be critical.

He points out that SEPA, the Scottish Environment Protection Agency, has indicated that licensing decisions will be related to the proportion of waste that is collected, so an effective semi-closed system could allow much greater production at existing sites.

Sustainability has always been a crucial value for Kames. It speaks volumes that Loch Melfort, where Kames has farmed for half a century, is also the site of a successful, ongoing native oyster restoration project – oysters require pristine waters in order to thrive.

Kames actively supports this and other rewilding projects, and more recently the company has signed up to the SeaFurther environmental initiative launched by Cargill.

As part of the SeaFurther initiative, Cargill has provided an expert assessment to help Kames focus on reducing carbon emissions, primarily in two areas: feed, which accounts for around half of the company’s spending and emissions, and diesel, which Kames is looking to replace with hybrid power where possible. The company’s hatchery is already run on hydro power from the same streams that supply its water.

SeaFurther offers a further option of carbon offsetting, which Kames has to date opted not to take up, preferring to concentrate on real changes it can make in its own operations.

Support for local environmental projects is just part of Kames’ community involvement. Other aspects include supporting local sports teams and music, including piping, and also helping to provide opportunities for young people. Kames was named Employer of the Year by Lochgilphead School and this year took on Joe Tustin the first student from Lochgilphead (and from Argyll as a whole) to enrol on the NPA Aquaculture course created by UHI Shetland.

Fish farming has its critics, of course, and it is highly regulated for good reason.

Neil Manchester would like to see the licensing process streamlined, but he adds: “We have to operate to a high standard, but that’s not a bad thing.”

Trainee Joe Tustin (left) on boat

 ‘We are trout converts’!

Joining Fish Farmer on the visit to Kames were the team from Diversified Communications, organisers of – among other major events – Aquaculture UK and the Aquaculture Awards.

Cheri Arvonio, Portfolio Director, Ocean Business, Aquaculture UK & Marelec with Diversified says: “We had an amazing and insightful few days with our long-standing media partner Fish Farmer magazine and Kames Fish Farm – the winner of our Aquaculture UK Best Aquaculture Company and Rising Star awards in May. 

“We were so impressed with how open and transparent the Kames team were with answering all of our questions, and allowing us to explore their sites. We learnt so much about how each of their sites operates, from their hatchery to their feed barge on the fish farm itself. We are also now trout converts!

“It’s so important for us to understand what challenges the fish farming industry are facing so that we can tailor our event, and do all we can to support the industry moving forward.”

She adds: “The team and I are loving getting to know all we can about the sector, and can’t wait to celebrate this amazing industry at the next Aquaculture Awards taking place on 15 June 2023, and of course welcoming everyone back to Aviemore at Aquaculture UK 2024 on 14-15 May 2024.

Carsten Holm (right) with Fish Farmer’s Richard Elliott