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Shrimp is America’s most popular seafood product. Yet, the industry is rife with problems, from human slavery to ecological devastation. This week on Sea Change Radio, we speak to Daniel Russek, the founder and CEO of Atarraya, a Mexican-based company whose innovative shrimp farming solution is called Shrimpbox. Russek talks about the problematic practices plaguing the shrimp industry worldwide and gives us a peek into the Shrimpbox approach.
00:01 Narrator – This is Sea Change Radio covering the shift to sustainability. I’m Alex Wise.
00:10 Daniel Russek (DR) – I really try not to eat shrimp if it doesn’t come from one of our farms or from a farm I trust. And I didn’t eat shrimp before starting this venture.
00:29 Narrator – Shrimp is America’s most popular seafood product, yet the industry is rife with problems from human slavery to ecological devastation. This week on Sea Change Radio we speak to Daniel Russek, the founder and CEO of Atarraya, a Mexican based company whose innovative shrimp farming solution is called Shrimpbox. Russek talks about the problematic practices plaguing the shrimp industry worldwide and gives us a peek into the Shrimpbox approach.
01:16 Alex Wise (AW) – I’m joined now on Sea Change Radio by Daniel Russek. Daniel is the CEO and founder of Atarraya and their product is called Shrimpbox. Daniel, welcome to Sea Change Radio.
01:27 Daniel Russek (DR ) – Hi Alex, happy to be here.
01:30 Alex Wise (AW) – So first, why don’t you explain the problem that a lot of consumers may not be aware of, which is the shrimping industry and then let’s dive into the solution that Shrimpbox your product is offering. So what is the problem with shrimp in general, Daniel?
01:47 DR – So I think that the first problem with shrimp is that the market cannot get enough of it. Basically, it’s the number one seafood product that in almost any country both weight, volume and value, most notably by value. For instance, Americans spend 70% more money on shrimp than on the 2nd place, which is salmon so and where you have when you have a market that cannot get enough of anything you have on the other side. People that are willing to do anything to get it right. So you have basically two options, which is one is wild catch but the problem with shrimp is that they don’t swim most of the time what they do is that they walk so they hang out on the on the seabed. And so the only way to get them is basically dragging that no, so you need to drag the bottom of the ocean, where something between 50 to 90% depending on who’s counting of the ocean life, lift, snow or the ocean biomass live.
02:52 AW – So the shrimp themselves might be wild caught, but then they may be catching some other extra stuff in these nets which are damaging the ecosystem?
03:01 DR – Yeah, the nice word for it is bycatch. So and basically shrimp wild catch is responsible for 50% of the global by catch and bycatch means yes, killing something for the benefit of no one from the ocean. So yeah, so that is that is the problem with traditional source, which is wild catch and wild catch numbers are not going anywhere. We’re not going to get another million kilograms from the ocean. So then shrimp farming was developed and it was developed in countries like Mexico and Ecuador that developed the technology early on. But then the problem is that basically, shrimp farms rely on a continuous water exchange with the ocean on a scale that is comparable to 1/2 a million people. For instance, the average shrimp farm in Mexico is considered to be 200 hectares or about 400 acres, and it has a continuous water exchange like 1/2 a million people city.
04:06 AW – Can you explain what you mean by water exchange?
04:08 DR – Yes, it’s basically so…Have you ever if you ever had a fish, a fish tank in your house? After some time if you get greedy and you put more fish more hobby fish there then they will start dying with their mouths to the surface. That’s because of erasure. No, that’s because of oxygen. So they basically take the oxygen through their gills. This is how they breathe, so but you put basically an air pump there and it’s in. Problem solved. No, at least with the with the decision, but the second problem is more important. At least that was what gave me problem with my mom when I had a fish tank in my house, which is the water gets green. Why does it get green? Because shrimp and fish they breathe through their gills, but they also metabolize. They get rid of the of nitrogen and. This is so they eat nitrogen in their protein and they get rid of it through their gills. So in the form of ammonium. So this ammonia start building up and the water gets green because ammonia is a fertilizer. So there are algae that are floating in the in the air and this algae makes the water column green. So shrimp farmers fish farmers. We don’t care if the water gets green. The problem is that after certain threshold after a certain concentration, the ammonia becomes toxic and this gives the shrimp or the fish something that is called the nitrogen syndrome. They cannot get rid of the of the of the ammonia and they die.
05:37 AW – So you need a healthy level of water exchange to keep whatever the marine life might be alive?
05:45 DR – That’s one strategy. Yes, that’s a traditional strategy dilution. So basically in the case of the kid, it has a toilet to flush the water, and in the case of shrimp farming, it’s basically the ocean that’s the ocean, so you are taking water from the ocean and discharging it at the same rate in order to keep your levels at the same. To keep your levels on the outflow. The problem is contamination. It’s pollution so and that water has organic matter. But also, shrimp farmers. I’m sad to say that some of them they use traditional shrimp farmers. They use pesticides, for instance because when they are filling their ponds. They are bringing in crustaceans, other kinds of crustaceans, so they have an insecticide to the water in order to kill the competition, because otherwise the feed conversion ratio goes up now, which is your most important cost so they have toxins to kill competition from shrimp. So then the result from these traditional shrimp farms can be dead zones in nearby ocean regions or inlets.
06:45 AW – And the main problem is that the surrounding areas can get toxified?
06:58 DR – It could be. Yes, exactly so the I don’t think that there is sufficient data on these on what was what has been the impact on the on the on the water outflows. I don’t know anybody that is that is researching this, but what is really known is that in order to get these easy access to water. Is the mangrove deforestation that that this has caused so instead of fighting or investing millions of dollars to create a structure that brings water from the open ocean, you’re located by a lagoon. So that’s what shrimp farming does, so mangrove forests are very efficient in terms of. Carbon carbon capture five times as efficient as any rainforest in the world. So in 50% of what we have lost in the world. In terms of mangrove forests, which are also nurseries for the ocean, have been devastated by the traditional shrimp industry.
07:56 AW – And what regions are these most prevalent in, both mangrove forests and shrimp farming?
08:03 DR – It’s a good question because so there are many crustaceans and there are many shrimp species in the world, but there is really only one that has been properly domesticated and by this I mean that you can get actually a selective breeding out of them so you can get the broodstock from the ocean. And you get the larvae and those library can become your boots like those are your F1F2F3 blah blah blah and after many generations you have selective breeding for the only species that this has been successfully made. And and there’s an industry around it. Is Pinellas Vannamei Pacific wide leg shrimp and the native area of these of these species is from the Sinaloa, from the Sinaloa coast, in in the West Coast of Mexico to Peru in the Pacific.
08:50 AW – These are different than the Southeast Asian farming species or are they the same?
08:55 DR – They are the same so basically this is the shrimp that has been adopted everywhere in the world to grow shrimp? So in places where you have work that are on these on these on this region on this tropical region you can get 3 cycles per year and in places where you’re outside of these of these temperatures you can get one cycle a year.
09:17 AW – So my father loves Ruby red shrimp. He lives in New Orleans. These are not the kind of species then that can be farmed?
09:25 DR – If they come from wild catch, most likely they are not, and if they are come from the coast from the Gulf Coast, yes, most likely they are not. So we have wild catch and now we have the problems we have shrimp farming traditional stream farming and now we know the the problem so but but I talked about the problem on the outflow of the water, so the problem on the outlook of the water is pollution and in in order to set the firms, you need to destroy habitat. But then on the in on the water, in on the inlet of the water. The problem is financial because then you get disease. So a typical shrimp firm doesn’t have any way to control the quality of their water, so disease come in to the, to the, to your pond, and you cannot control it. So then the question of this industry if you if you, if you own a farm, is not if but it’s when you’re going to have the existential threat of disease coming at your door and destroying 50 to 70% of your production on any given year.
10:25 AW – And then it becomes a cost benefit analysis of is, is it worth putting this harsher insecticide to kill whatever the disease might be, or cutting costs? Or it sounds like there could be a very slippery slope for a farmer to try to save their crop.
10:43 DR – Exactly and then so they start using antibiotics, which in reality I’ve been farming trim for 12 years and I don’t see any real benefit on antibiotics for shrimp farming.
10:54 AW – But that’s largely prophylactic.
10:56 DR – It’s prophylactic, exactly, and sometimes they use it as a reaction, but most of the disease that we are worried are viruses, so your antibiotic doesn’t have any use for it.
11:07 AW – And then we end up getting traces of that antibiotic in our diet that we’re not maybe counting on.
11:14 DR – Exactly know for sure you’re not, so the and actually, you can Google this and you can see scandals about this frequently. Yeah, that’s the problem.
11:30 (Music Break)
12:34 AW – This is Alex Wise on Sea Change Radio and I’m speaking to Daniel Russek. Daniel is the CEO and founder of Atarraya and their product is Shrimpbox. So Daniel, you’ve laid out the shrimp industry’s issues. What is Shrimpbox doing to try to address some of the shortcomings that we’ve seen up until now?
12:55 DR – So Shrimpbox is a way to…it’s basically a technology to enable local, sustainable and affordable shrimp anywhere in the world. So it’s basically enables anybody to to grow shrimp in urban settings, in semi-urban settings. And the reason why it’s because of the and the most important technology advance of these is the 0 water discharge that is made in a replicable way in an accessible way, so that you don’t need pH D’s on your farm to run it. You basically rely on engineering. Software that encodes these biotech protocols that we have learned for 10 years. And uhm, yeah, in a remote monitoring from experts from human experts that are advising you in case something goes wrong.
13:54 AW – So explain the technology of Shrimpbox and why it’s different from its predecessors when you’re trying to explain this to a shrimp farmer. What are some of the selling points? When does the light go off for them and they say that’s exactly what I’m looking for.
14:10 DR – This is interesting because I’m considering about in my mind I have two farmers and the farmer that I care about is there would be a shrimp farmer in a country like the United States or places where you don’t have shrimp farming really so in the United States 95% of the shrimp that is consumed comes from abroad, so there is no industry in the United States. There is no shrimp farming industry in the other states so for that farmer or would be farmer the important thing is that this is a product that is very easy to market and we have worked for over 10 years in order to make this a reasonable investment. That will give you a good margin so that you can have a good return on your investment and you will have a great over infrastructure and support so that you can thrive so you’re not you’re not by yourself. You will have your baby shrimp, your postlarvae you have the inputs you have, the infrastructure, the maintenance. Monitoring and also if you needed to go to market right and we will partner with you so that you can be successful at race.
15:25 AW – I’m still trying to understand the scale and the technology itself and how it differs from traditional shrimp farms.
15:33 DR – The most important innovation in these are the most important difference is that we don’t need water discharge. We don’t need water exchange, so we can put these Shrimpbox in landlocked areas. We can use any water we can turn it into the chemical conditions that the shrimp needs. And we will read utilize that water many times over so you won’t need to spend a lot of money in creating the saltwater, but also in keeping the heat of that of that of that water. So and this we learned from. Basically we learn from nature because nature doesn’t have this option of disposing nutrients in something that is known nature and then they basically have these dilutional. So the way that nature works or treats this nitrogen imbalance is by creating a microbial community that captures these nitrogen and creates new protein. And this technology is called bioflow and this is basically how water bodies in the world. Uh, maintain its balance, its nutrient balance. So we developed this technology to be applicable to shrimp farming, so this technology is old or at least in theory it’s old, the understanding of microbial communities. It’s it’s old in this regard. But we applied it to shrimp farming. But then the cost of these biotech is complexity, so we turned these protocols into software.
17:17 AW – It can’t be added onto existing systems. You have to start fresh with a stand alone Shrimpbox system. Is that correct?
17:25 DR – Exactly exactly. So basically we have solved everything and the so basically the farm whatever you need in the firm is already in the Shrimpbox, so all the infrastructure is already, it’s there in this in this rain box and then it has sensors, and it has interactors that are connected to a cloud based so software that knows what to do and it’s basically orchestrating all of your production. But it’s also telling us what you need, when will you need feed? When will you need your baby shrimp and where you’re when your production will be ready to market.
17:59 AW – Looking at pictures of your Indianapolis facility, which I want you to describe a little bit later. It looks very futuristic, very high tech, but I can’t help but think that some subsistence shrimp farmer in Indonesia or Thailand. This would be not something that they would be able to afford. Is this going to be something that is scalable to all sorts around the world?
18:23 DR – So yeah, this is a great question. The biotech behind Shrimpbox it’s applicable to any farm and that would be that would be affordable to a traditional trim farmer as well, and the software would be also applicable to a traditional shrimp farmer for many years. We worked on this technology and our goal was to develop it so that traditional shrimp farmers would adopt these zero water exchange. Technology, then after the problem is technology adoption now if you have a good business and you’re making money and then it comes this guy that tells you oh, if you adopted this technology then you won’t destroy the oceans. You might listen, you might not. So the ones that I talked with didn’t listen. So this is why we invented this technology to basically not need to convince anyone in the traditional shrimp farming.
19:25 (Music Break)
20:16 AW – This is Alex Wise on Sea Change Radio and I’m speaking to Daniel Russek. He is the CEO and founder of Atarraya. Their product is Shrimpbox. So Daniel, why don’t you take us on a virtual audio tour of the Indianapolis facility and explain how this might differ from a Siniloan or Chilean or Thai shrimp farm that somebody might have toured?
20:43 DR – Excellent so you are driving around Indianapolis, so the urban area of Indianapolis.
20:51 AW – Nowhere near the ocean.
20:53 DR – Nowhere near the ocean and you just see a warehouse and you and you think oh is there a shrimp farm here? OK, I’ll take a look. So you go and you will see something that looks like a cargo container that has 222 tanks, basically 2 levels. No one on top of each each other, and each of these cargo containers. It has a a control room with many different engines and pumps and sensors and interactors, and if you if you peek because it has Windows, you can actually see the shrimp you will see you will see, basically like a lagoon, no, so you will see water. That is either green or a little bit brown like a natural lagoon and you can just use one of your nets and you can drag shrimp just a little bit and you’ll see live stream. Living there no, and you will see 20 or 40 of these Shrimpboxes depend on when you visit us. Right now we have 5.
21:51 AW – And these boxes are like basically like a truck bed?
21:54 DR – Exactly, it’s a 40 foot HQ cargo container and the reason why it’s because this is the biggest thing that you can move around the world using the intermodal system. So these are program platforms that were manufactured in Mexico City and there are ready to use. So for instance in Indianapolis. We signed the lease in June. We put the first Shrimpbox in July. And our first harvest is going to be in November.
22:21 AW – Yeah, that was my next question is what’s the harvest time? So it’s just three or four months from start to finish? These things mature fast. I guess that’s maybe would lead this to be such a wildly popular product. Besides shrimp being tasty if it’s got a quick harvest time.
22:38 DR – Exactly and and the and the biomass is amazing because the shrimp they grow 10,000 times its size in these four months.
22:47 AW – Wow, does that differ from the wild?
22:51 DR – Well, it’s it’s about so….These are genetic, so this has been selective breeding, you know. So it’s it’s been through a process of selective breeding. It might be three times or four times as fast as the as a wild caught shrimp but through selection. Uh, not genetic engineering, but through selection so, but other than that it’s basically it’s the same animal.
23:17 AW – And I should have asked you this earlier, but what’s the price difference? Usually between wild caught and farmed shrimp, not the Shrimpbox product, but just traditionally in the last, you know, decade, what’s the cost to the farmer itself? Once you’ve kind of got your farm up and running, are your incremental costs comparable to the wild catch or is it actually cheaper? I’m curious how consumers are paying for shrimp versus how producers are paying for their setup costs.
23:47 DR – No, this is a very a very relevant question, because really the average price of the imported shrimp. It’s about if you if you Google. This would be $14 to $18 per kilogram. Now the cost of producing that same shrimp is around $3.5 per kilogram at the farm. So the average consumer is paying basically 75% on intermediation now. That is national intermediation in Mexico or Ecuador and also international intermediation in the United States so it can get to your city.
24:22 AW – So how does that compare versus the wild caught shrimp in terms of price? The main cost for Wild caught is diesel, right?
24:32 DR – So basically the fuel. I think it’s easier to compare this on a price point. And if you get the cheapest commodity, the cheapest frozen commodity, it would be farmed shrimp. And basically we’re talking about the same size, no, imagining that we’re considering the same size. The cheapest commodity would be farmed shrimp somewhere from Asia. No, probably India. And then the top line the most expensive steel commodity shrimp would be wild caught. From a US from an American ship, and the difference would be about 65%.
25:10 AW – And that’s because of Labor and environmental regulations. Or why would the American ship be more expensive versus, let’s say, the Indian ship?
25:19 DR – So here we’re talking about equilibrium prices, so I think it’s both, so it’s also a reflection of cost, but I think it’s also a reflection of what the market is giving value to? No, I think that having a domestic boat, uh, you you. I think that the market gives a little bit more trust to that it’s it has complied with some regulations or some environmental. I don’t know. You can ask the market but it’s really 65% the difference between the cheapest farmed one to the most expensive wild.
25:56 AW – So until a consumer, a Sea Change Radio listener can start sinking their teeth into the Shrimpbox shrimp. What should somebody who loves shrimp do what? What do you do when you go out to buy shrimp from a grocery store or at?
26:10 DR – A restaurant I really try not to eat shrimp. It’s if it doesn’t come from one of our farms or from a farmer I trust and I didn’t eat shrimp before starting this venture.
26:20 AW – You didn’t?
26:21 DR – No
26:21 AW – No, so this venture kind of made you realize that there is hope for people who love this form of protein, but its current state is not really unsustainable, but it’s distasteful in terms of so many different aspects of the industry.
26:39 DR – And literally, because also when you’re getting when you’re getting a shrimp, most of what you’re tasting is the preservatives potassium metabisulfite, for instance, which gives these like kind of salty. Uh, like it dries your mouth so that is not that is not the the flavor of shrimp that is the flavor of the of the preservative, and they need to use it because this is the only way that they can have it for three or five years frozen before you get it.
27:10 AW – So people should just not eat shrimp until they can get a Shrimpbox shrimp. In a best case scenario, when can we start seeing your product in our stores or at at restaurants on the horizon?
27:23 DR – So right now we are starting harvests in Indianapolis, so if you come by we’ll treat you, but this is of course for that area, but we are we’ll start harvesting with from other people farms more like on a commercial scale. We’ll have a a small industry by the end of 2023 that is our goal and we intend to capture 5% of the market with this technology by 2030.
27:53 AW – Well, good luck is a terrific idea, and you’ve taught us a lot about the shrimp industry. Daniel Russek, thank you so much for being my guest on Sea Change Radio.
28:01 DR – Thank you very much, Alex.
28:17 Narrator – You’ve been listening to Sea Change Radio. Our intro music is by Sanford Lewis and our outro music is by Alex Wise. Additional music by Grant Green, Allen Toussaint, and Peter Green. Check out our website at seachangeradio.com to stream or download the show, or subscribe to our podcast. Visit our archives there to hear from Bill McKibben, Van Jones, Paul Hawken and many others, and tune into Sea Change Radio next week as we continue making connections for sustainability. For Sea Change Radio, I’m Alex Wise.