The centre, expected to be based in the country's south, recently won funding worth A$35.5 million from the Federal government, while more than 40 other industry participants will contribute a further A$100 million to the seven-year project.

Australia's seafood sector is worth around A$2.1 billion a year but a recent report suggests that outdated processing methods are preventing it from meeting surging demand while it is facing growing challenges from imports. The Australian Bureau of Agriculture and Research Economics (ABARE) says that the sector's production value has dropped from A$2.3 billion in 2003.

The new research centre, to begin operating in July 2007, could however double the industry's value to A$4.2 billion each year within 10 years, according to the consortium behind the proposal, with new methods to increase production and farm fish, such as raising fish in inland saline waters. It also plans to reduce waste, looking at how to make use of fish discarded at sea.

"We'll be looking at fish that have no value at the moment and trying to build value into them," Peter Dundas-Smith, chairman of the consortium told AAP. "In some cases fish are handled up to 16 times from production through to the consumer. We're going to try to reduce that amount and increase profitability."

He said the industry was only meeting 40 per cent of Australian demand and that without investment in research and innovation this could drop even further to 25 per cent by 2020.

The consortium has been supported by around 90 per cent of the country's seafood industry as well as research institutes including Tasmania University, South Australian Research and Development Institute, Adelaide University, Flinders University and Queensland Department of Primary Industry.

The research will also cover product quality and integrity, the health benefits of seafood and value chain profitability.