A new high-tech hatchery opening in Cowell today will help the South Australian pacific oyster industry overcome its biggest stock shortage.

Traditionally, SA has relied on Tasmanian hatcheries for at least 80 per cent of its baby oysters or spat, but that supply was cut-off when the island state was hit by Pacific Oyster Mortality Syndrome, or POMS, early last year.

The new $4 million Eyre Peninsula facility, which is mainly industry funded, has been set-up by major Tasmanian spat supplier Shellfish Culture.

Operations manager Gordon Gardner said it had the capacity to produce twice as many young oysters as what the state needs.

Inside the new oyster hatchery, which is expected to help farmers through a difficult patch. ( ABC Regional: Kerry Staight )

"This is the silver lining," he said.

"As a result of [Tasmania] being hit with this horrible virus we've actually got a world class facility on our doorstep in South Australia.

"What we've built here is a long-term vision and we've got other markets.

"We can look at the New South Wales market, for instance, and we've also got interests already wanting us to export oysters into Japan."

For now though, the focus is on restocking local farms, with the state's 100 or so growers desperate for oysters.

"It's a drought, there's no other real word for it," Cowell oyster farmer Simon Turner said.

"It's the worst that our industry has ever had to experience."

Production becoming a 'slow-motion train wreck'

Oyster producer Simon Turner is hoping the future will be bright. ( ABC TV: Landline )

Mr Turner normally harvests up to 3 million oysters a year.

This financial year that will drop by up to 30 per cent and, with oysters taking 12 to 18 months to reach a saleable size, the situation is set to worsen before it improves.

Mr Turner is predicting production will more than halve next year.

"It's like a slow-motion train wreck," he said.

"You've got time to see it, feel it and morale is really low at the moment."

Production of oysters is expected to fall significantly this financial year. ( ABC Regional: Kerry Staight )

While some farmers are diversifying to get through others, including industry veteran Gary Olds, have temporarily shut down.

"I wouldn't have even been able to buy enough to pay all the bills let alone have enough survivors to pay all the bills," Mr Olds said.

"So I either had to scale down which would have been quite a big change in equipment or just stop for a while."

Oyster drought set to break

The first batch of spat at the new oyster hatchery. ( ABC Regional: Kerry Staight )

But the opening of the Cowell hatchery is lifting growers' spirits, with the first batch of spat due to be delivered to farmers at the end of November.

"To see it pop up in the capacity that it is, is so very exciting ... it's so hugely exciting," Mr Turner, who is also on the board of directors of the new facility, said.

Eyre Shellfish is not the only Tasmanian spat supplier to set up on the mainland, since POMS broke out.

Tasmania's other major producer of young oysters Cameron has also opened a facility on the Eyre Peninsula in a joint venture with a local abalone farm.

And with two smaller South Australian hatcheries already established in the region, the oyster drought is set to break in a big way.

The owner of one of those hatcheries Rodney Grove-Jones is concerned this could lead to an oversupply and threaten the viability of the smaller players.

But he agrees the emergence of an oyster hatchery hub in SA, is a happy ending to the darkest chapter in the industry's history.