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Business Outlook:

Maine Seaweed Farming

The Maine Seaweed Exchange is committed to supporting and advancing the farmed seaweed industry. Certification programs, aquaculture training, collaborations, and advocacy are a few of our tools to fulfilling our mission.

We are also students and observers of industry trends. Based in Maine we are especially connected to that state, although we represent seaweed farmers globally. This post is meant to highlight some concerns about the future of seaweed aquaculture in Maine.

Maine and Alaska arguably have the two highest value “brands” in seafood and seaweed. Both are perceived to have pristine waters and high-quality products. Both are leaders in seaweed aquaculture. Here the similarity ends.

Maine, the innovator and first mover in seaweed farming, has taken the path of small, part-time farmers (generally lobstermen) leveraging existing resources. Aquaculture leases tend to be small, widely distributed, and what many may consider shoestring operations. The majority of seaweed farmers sell to one buyer at roughly $0.60 per pound wet, with this price forecasted to drop as more growers enter the market. If that buyer drops out of the market, the market will plummet. The MSE regularly receives calls from Maine seaweed farmers that have successfully grown seaweed and have not been able to find any buyers. One recent call was from a farmer that had just cut 8,000 pounds of seaweed loose because no one would buy his crop. This farmer is not alone.

Alaska came to seaweed farming later to the game. Seaweed farms in Alaska are larger, located near processing, and generally owned and operated by established seaweed or seafood companies. Prices for Alaskan seaweed range from $0.60 to $0.90 per pound wet, with several established buyers.

Two states, two great brands. Both states are leaders in seaweed aquaculture. Maine is highly dependent on one buyer making CPG (consumer packaged goods). Alaska has multiple buyers producing CPG and ingredients.

Comparing these two states:

The last row in the chart above is “Market Role.” This reflects that Maine’s seaweed industry was built by first movers and Alaska’s by fast followers and second movers.

In Maine, Sea Grant popularized seaweed farming as a way to support local working waterfronts and provide supplemental and seasonally complementary income to lobstermen. This helped kick start the farmer side of the industry. Ocean Approved (now Atlantic Sea Farms) was an early entry into the edible seaweed market producing seaweed cut into noodle form, seaweed smoothie cubes, and recently seaweed slaws and kimchi. Based on these products and the nascent small-scale seaweed farm model, Maine was a clear first mover. This advantage was short lived. The small distributed farm model with part-time farmers prevented the development of processing facilities and infrastructure. The Atlantic Sea Farms CPG products face tremendous headwinds of slow to change consumer preferences and a product line that heavily tends toward center of the plate and side dishes. After over ten years in the market, Ocean Approved/Atlantic Sea Farms has struggled to gain market traction although recent efforts seem to be attracting consumer attention.

In contrast, Alaskan growers and producers have learned from Maine’s missteps. Its farms are larger, based near processing, managed by industry players that are vested in aquaculture, and producers making value added products with seaweed as an ingredient riding the health food movement versus attempting to change consumer preferences.

It is arguably time for the Maine seaweed farming industry to take a deep breath and evaluate its current position and future steps. So, it is worth looking at the overall seaweed industry and its challenges and opportunities.

The farmed seaweed industry is certainly the darling of the blue green economy. Whether it’s the new kale or reducing cow flatulence, seaweed is attracting a lot of attention and investment. Some of this attention is justified, some not so much.

I am as committed as anyone in the industry to the belief that seaweed aquaculture has the potential to be a commercially viable and sustainable contributor to our global economy.

Seaweed aquaculture has been recognized for its potential to benefits. These include:

  • Low fresh water usage during grow out;
  • Generally low fossil fuel utilization during grow out;
  • Generally little to no utilization of synthetic fertilizers, pesticides, or herbicides;
  • Nutrient dense product with varied uses including food, animal feeds, fertilizers, nutraceuticals, pharmaceuticals, and cosmetics;
  • Potentially reduces ocean acidification and uptakes water contaminants such as nitrogen, phosphorous, and heavy metals; and
  • Supports working waterfront communities.

Of course, these benefits are balanced by some impacts, including:

  • Reduction in biodiversity and introduction of invasive species;
  • High cost of processing and/or storage, including fresh water and fossil fuels;
  • Potentially high levels of heavy metals such as arsenic;
  • Potentially high levels of other nutrients such as iodine;
  • Grow out gear that is synthetic and presents hazards to marine mammals and navigation; and
  • Halocarbon emissions which can seriously impact the ozone layer.

This graphic highlights some of these benefits and risks.

Many of these benefits and challenges are nuanced. For example, many seaweeds are rich in iodine, an important nutrient for human health. Unfortunately, too much iodine in the diet is harmful and too much iodine is what you often eat when you have sugar kelp seaweed salads and noodles. Seaweeds also are rich in trace elements and nutrients that are virtually impossible to obtain in any other single food.

So when it comes to food, what is the correct balance?

Focusing on iodine, as it represents one of the highest risks, the following are the recommended daily allowances by the National Institute of Health:

When choosing seaweeds to eat, the general guidance is:

  • Nori—A poor source of iodine, so considered safe to eat;
  • Wakami (alaria)—Relatively high in iodine, so anything less than 10-20 g (roughly a tablespoon) per day is likely safe; and
  • Kombu (sugar/skinny kelp)—A high source of iodine, should be eaten in limited quantities, especially raw.

In Japan, where seaweed is widely consumed, the average intake of all seaweeds is 5 g (one teaspoon) per day, mainly cooked. Cooking seaweed has been shown to remove iodine and arsenic from seaweeds, so these limits can be higher if the seaweed is boiled.

One thing to note about Asian consumption of seaweeds is that seaweed is often eaten with foods that are goitrogens, i.e., contain compounds that are thought to have anti-thyroid properties and thus prevent absorption of iodine. Goitrogens include soy beans, bok choy, and broccoli. Asian food as a cuisine is thus iodine self-modulating—something the modern western diet is not.

Why is this iodine discussion important? Well, if your market is based on CPG products the amount of iodine is important. For example, a Maine produced “Ready Cut Kelp” product has 1,117 mcg of iodine per serving. This is 7 times the RDA for an adult, and roughly 10 times the RDA for children.

The chart below lists the Tolerable Upper Limit, the maximum amount that is considered safe to consume for a short period, for iodine from the Food and Nutrition Board:

The UL for adults is 1,100 mcg (600 mcg in the EU), lower than a single serving of Ready Cut Kelp. This suggest that eating Ready Cut Kelp involves some risk. This product has a lot of iodine that may cause the same symptoms as iodine deficiency—including goiter, elevated TSH levels, and hypothyroidism.

It is also worth noting that kelp is not approved by the FDA as a food (it is approved as a seasoning or flavoring so long as it does not exceed 225 mcg per serving).

Keep in mind that these RDAs are for total intake of iodine. If you eat a serving of Ready Cut Kelp along with a dozen oysters, your iodine intake would be 1,405 mcg—nearly 10 times the RDA for an adult. If you went back for seconds, you could be looking at 2,522 mcg-- when the daily intake of 2,000 mcg iodine may be toxic, particularly in people with kidney disease or tuberculosis.

Compare Ready Cut Kelp to a commonly available seaweed penne pasta which has 30 mcg of iodine or roughly 20% of the adult RDA. By utilizing seaweed as an ingredient, this pasta product is FDA compliant with iodine well within RDA limits.

On January 1, 2021, the labels on many foods will need to be changed to reflect a more accurate serving size. The Ready Cut Kelp product has a serving size of 56 g currently which amount will be updated to a more accurate 85 g per serving. This means the iodine per serving will be 1,695 mcg or 11 times the RDA for an adult, and 14 times the RDA and almost 3 times the permissible upper limit per day for kids.

How is this relevant to the future of seaweed aquaculture in Maine? I believe it is quite relevant. The largest and only significant buyer of farmed seaweed in Maine is the producer of Ready Cut Seaweed. If this product causes harm or illness it may well taint the entire seaweed industry. It would only take one death or serious illness/reaction to undermine years of work and innovation to develop the seaweed industry.

Product safety must be an industry priority. It is unwise to permit one irresponsible company to taint an industry that has so much potential. This risk is especially real in Maine. In Alaska and other countries, seaweed farming is conducted by well-funded companies protected by reasonable food safety standards. In Maine seaweed farming is built on a base of small-scale farmers with limited resources/experience and very little access to markets and buyers. This is an existential risk to Maine’s pioneering seaweed farmers and marine economy dependent communities.

I think the precarious situation Maine seaweed aquaculture is highlighted by these facts for 2019 from the Island Institute (an investor in Atlantic Sea Farms):

  • 325,000 wet pounds of seaweed harvested;
  • $195,000 value of harvest;
  • $8,125 gross income per harvester; and
  • 3 processors with an average of $1.5 million in gross sales and employing 28 persons.

For context, in 2019 the average revenue per McDonald’s location was $2.7 million with over 30 employees. The Maine farmed seaweed industry generates less revenue and employs far less employees than two McDonald’s franchises. This highlights how early stage and fragile this industry is.

Beyond the products made in Maine and Alaska, we must also examine best practices and regulations. It is imperative that we protect our industry and its members by creating and adhering to standards that assure that consumers are confident that the seaweed products they are purchasing are safe, environmentally beneficial, and are sustainable.

This table lists Maine’s and Alaska’s regulatory framework on several key issues.

Maine, the first mover, remains highly unregulated. To some this is a good thing. I would suggest it is not. Investors look for and value regulations and guidance that establish a stable and rational business environment. Investors want predictability and stability. Maine has failed to attract any significant private investment in seaweed aquaculture remaining reliant on individual farmers to self-fund or seek governmental grants. In contrast, Alaska while also accessing the pool of grants available, has attracted significant private investment including by seafood giant Trident Seafood and several others.

Maine’s lax regulatory framework, lack of food safety standards, dysfunctional leasing laws, lack of infrastructure support, and a virtually non-existent roadmap for seaweed and other aquaculture industry development, has created a threat to the growth of our fledgling industry. We are surrendering our first mover advantage to savvy fast followers that have learned from our initiatives and those of other New England states to create a robust framework for seaweed aquaculture that is attracting public and private investment.

In Maine we are overly reliant on one buyer, a flawed supply chain, and products that have not been demonstrated to be safe. Our regulations are not well developed, best practices are undefined, and the leasing structure, while offering multiple options, ignores the lack of social license and principles of shared use of our resource commons.

We are at a crossroads in Maine. It is not too late to work together to create a sustainable industry. The Maine Seaweed Exchange has worked for three years now to create a network of farmers and producers to drive industry wide standards and best practices in Maine and globally. We will continue to do so.

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