OYSTER farmers in Port Stephens will play a key role in a Sydney-led company's ambitious plans to ramp up production and supply of the Sydney Rock Oyster.
In an investment worth "north of $55 million", East 33 has bought assets in the oyster supply chain in Wallis Lake, Port Stephens and Manning River and plans to boost its SRO production three-fold by 2023.
East 33 produces about 6 million SROs each year, with the national production of the oyster at 77 million oysters across 22 locations. SROs are unique, with just one to every 36,000 of Pacific oysters produced annually.
Financier and East 33 executive chairman James Garton said the acquisition plans began four years ago when he had discussions with fellow Sydneysider Mark Nagy, who has a 50-year association with Wallis Lake region and liaised with its oysters farmers on growth opportunities.
"As we got to know the [oyster] farmers ... they began to express their vision for the industry and their concerns about keeping their sons in it and how they were going to export and we fell in love with their passion for the Sydney Rock Oyster, at the time not knowing it was such an indigenous product in only few locations," Mr Garton said.
"We did a lot of research and Wallis Lake and Port Stephens are the backbone of the entire Sydney Rock Oyster producing ...but the industry has flatlined as a lot of the longstanding farmers and families who are fourth and fifth generation are looking for a succession plan."
East 33 has raised capital from Australian-based investors to complete acquisitions worth more than $55 million consisting of 154ha of oyster farming water leases, an oyster nursery in Port Stephens, an SRO export-approved distribution facility in Tuncurry and Hamilton's oyster bar (Tuncurry) and one of the largest oyster processing wholesalers in Sydney.
"We have insisted that all the farmers and their families all stay in the business, it's disingenuous to say we've acquired their businesses - we have, but it's their business plan. We are just adding corporate and business nous," Mr Garton said.
He said East 33 would continue the legacy and improve oyster farming practices with best research and development which has until now eluded individual farmers who cannot scale.
"It took us four years to get in place a vertically integrated business. It's not more complicated than bringing in simple efficiencies to drive up production," he said.
He said East 33 had hired new staff and Port Stephens would benefit: "In the short term we think there's a lot of opportunity to invest in increasing waterways, infrastructure and jobs."
Oyster farmer Stephen Verdich, 66, who with his two sons runs operations at Wallis Lake and in Port Stephens, said being a part of East 33 had guaranteed his offspring employment and a chance to at least double its production in a third of the time.
"With the aggregation of other farms in the group, not doubling up on machinery and accumulation of staff, we'll have economies of scale and be able to reach these goals much sooner than I had dreamed about," he said.