A small fish can make big waves

We are passionate about innovation. It is a concept that we are fond of covering in our stories, always looking for young bright minds that are somehow, somewhere investing their time and effort to find new ideas, new solutions, and most important, new businesses.
We are so enamoured with innovation that we run a fortnightly column by innovation expert, soon-to-be Dr Rikus Grobler, telling us all about what potential benefit innovation holds for business once it seriously embarks on this route.
Around 1992 or 1993, I was the guest of one of the most brilliant minds I have ever met. The Managing Director at that time of Woker Freight Services, later to become Manica, and still later, Bidvest, was a gentleman by the name of Harald Dennewil, a walking, thinking one-man think tank and encyclopaedia. It was customary for me to pay this man a visit when I went to Walvis Bay to find out how the fishing industry really works, that is behind the scenes and behind closed boardroom doors.
On one occasion, Mr Dennewil invited me into his office and with much aplomb produced two cans  of fish from a glass-door display cabinet in his office. At that time the Pilchard Total Allowable Catch (TAC) was still around 120,000 tonnes per annum. This source would soon thereafter completely implode with the TAC reduced to 35,000 tonnes and then scrapped altogether. This put the entire canning industry into a conundrum, and over the years, it has made most of the canning infrastructure obsolete. The South African company that supplied the cans and provided the technical support, Metal Box, closed its doors, packed up, and retreated to their homeland.
But that particular day in the MD’s office, the two cans contained not pilchard, but horse mackerel. Mr Dennewil opened one can for us and there we sat, a lowly reporter and the MD of one of the biggest fishing companies, eating canned horse mackerel together as if we were big chums.
The economics behind this first experiment were obvious. The pilchard stock has collapsed while horse mackerel, at that time, had a TAC of 410,000 tonnes (I think). You do not need a programmable calculator to work out the basics, it slapped you in the face. If 35,000 tonnes of pilchard had such a high commercial value, imagine what the ultimate value of the horse mackerel TAC could be, if only two small but very significant snags could be solved.

First, the anatomy of horse mackerel is such that it carries two so-called scoot bones just before the tail. These two bones did not process well through the standard head and gut (H&G) equipment installed then. The processing tended to rip a substantial percentage of fish into shreds as the bones got stuck on the oscillators. The second trick to solve lay in horse mackerel’s natural acidity. It corroded the inside of the can over a period of about six months, reducing the shelf life of the product, and consequently, the efficiency of the retail distribution chain.
But the contents we ate that day was both savoury and tasty. It was a good quality canned product. It was prepared by Namsov which at that time was a joint-venture company with Russian trawler operators, and a Namibian quota. The traditional market for horse mackerel is West Africa where this is the cheapest form of protein available, around 16 US cent per kilo. The catch is processed at sea with zero land-based processing. It is frozen into 20kg blocks that go directly onto a reefer at sea, which takes it to ports in West Africa.
This is where innovation comes into play. The horse mackerel quota holders were not content with this massive resource, the biggest in the entire fishing industry, to remain the lowest in value. Pleasant was my surprise when earlier this year, first Etosha announced they are now canning horse mackerel, then Gendev announced the same, and now most recently, Namsov. In the meantime, I also found out that Metal Box has developed a new can with a much sturdier inside film, and that they are again interested in local canning potential. Go figure!
The horse mackerel quota holders has certainly been doing their homework and their research. Although it took the better part of twenty years, it is a wonderful story of perseverance and commitment. Suddenly horse mackerel has been elevated to an important commercial species.
I foresee that the 2% of quota limit will be increased and that progressively, a larger portion of the quotas will go into cans as the range of new canned fish products become popular with consumers. If the market dynamics pan out the way I anticipate, somewhere in future we shall no longer send horse mackerel to West Africa, but chuck as much of it as we can, into a can.