SeaDragon signs significant raw material supply contract
SeaDragon signs significant raw material supply
contract 10 March 2014
Agreement overcomes historical supply constraints
SEA: NZX and Media Release
10 March 2014
Australasia’s largest fish-oil refiner SeaDragon (NZX: SEA) announces a new raw material supply agreement has been signed that will underpin its Nelson-based squalene manufacturing operations, and enable the business to seek new market opportunities in the pharmaceutical and cosmetic sectors.
SeaDragon has entered into an unconditional agreement with Pescarias Cayon & Garcia LDA for the supply of shark livers and shark liver oil to be landed in August and October of this year and in January of 2015.
The shipments will deliver quantities more than sufficient to cover the squalene production SeaDragon has budgeted for in the 2014 calendar year and beyond. The prices SeaDragon will pay for the shipments are linked to the squalene content of the material and are internationally competitive.
The agreement, also envisages SeaDragon acquiring further raw material from Pescarias Cayon & Garcia in the future.
SeaDragon Chief Executive Ross Keeley said: “The agreement locks in raw material supply for the immediate future, overcoming the shortages that have historically constrained the growth of our squalene operations and limited sales activity into new sectors such as cosmetics and pharmaceuticals”.
“This agreement will ensure the success of the existing squalene business and will further strengthen our position as we prepare to expand our Omega-3 fish oil activities. Our existing shark liver refinery will now be able to be run at full capacity for at least the next 12 – 18 months.”
The high volume of squalene will also enable SeaDragon to launch an Alkoxyglycerol product onto the market. Alkoxyglyercols are found in the co-product when squalene is fractionated and removed from shark liver oil. There is a growing international market for these compounds, with a variety of proposed health benefits.