A statewide effort to build up Alaska’s mariculture industry is looking to expand production at the same time it grows the market, particularly for kelp.
“Everyone talks of the chicken-and-the-egg situation,” Juliana Leggitt, mariculture program manager at the Southeast Conference, said of what comes first: More kelp or more buyers. “There are definitely challenges in both.”
The Alaska Mariculture Cluster, a consortium led by the Southeast Conference, has $49 million in federal money and $15 million in cash and in-kind matching funds to use over the next three years to help seaweed farmers and oyster growers start or expand and improve their businesses, find markets and take on a bigger role in the state’s economy.
Wrangell’s Julie Decker, who is leaving her job as executive director of the Alaska Fisheries Development Foundation, said she gave her first presentation using the word “mariculture” 10 years ago. “There was nobody talking about seaweed.”
Now there is a lot of excitement about the potential for a robust kelp industry in Alaska, though there is still uncertainty over the economics, she said in an interview Oct. 5.
A big question is how to introduce kelp — and more oysters — into the American diet, said Dan Lesh, deputy director at the Juneau-based Southeast Conference. The Mariculture Cluster includes nearly 20 municipal, nonprofit, university, Native and tribal corporation partners from across the state.
Part of that work includes getting marketers, producers and retailers to take risks on new products, Lesh said during a panel discussion at the Southeast Conference annual convention in Sitka last month.
The Mariculture Cluster has brought on a contractor to help develop marketing strategies, Leggitt said in an interview. Not so much at the individual retail level, she explained, but focusing more on broader areas which include foods, biopharmaceuticals, cosmetics and animal feed.
Kelp is increasingly used in salsas, dried snacks and skin care products.
“The success of the industry looks different to different people,” Leggitt said. While some look toward large-scale production, others think of smaller markets, food security and food sovereignty for Alaskans.
The Mariculture Cluster has allocated $1.2 million for market research and development, Lesh reported at the Sitka conference.
There is also money for a revolving loan fund, equipment for hatcheries and nurseries, and research and development of new products to boost sales, with most of the funding from a $49 million Build Back Better grant provided by the Economic Development Administration at the U.S. Department of Commerce.
“We want to marry the local Alaska wisdom on the ground” with professional expertise in growing kelp and oysters, Lesh said.
The Alaska Mariculture Cluster Joint Innovation Program, through the Alaska Fisheries Development Foundation, awarded grants totaling $1.27 million to 15 companies this past summer — seven in Southeast — for research and development projects that address barriers to growth.
The program will offer a second round of grants to Alaska operators next year, said Decker, who is phasing out of the mariculture work for her new job as president of the Pacific Seafood Processors Association, where she will go full time on Jan. 1.
A big goal of research and development funding, Leggitt explained, is to increase production in order to lower costs.
Juneau-based Spruce Root, established in 2012 with funding from Sealaska Corp., will help set up the Mariculture Cluster’s revolving loan fund, while also providing assistance and coaching for mariculture start-ups.
The loans will be available for new and expanding businesses, Alana Peterson, executive director of Spruce Root, explained at the Southeast Conference.
“They are a crucial partner,” and will take the lead on the new loan fund, Leggitt said of Spruce Root.
One-quarter of the loans will go toward Native-owned operations. There is a similar set-aside for rural communities.
Though the Mariculture Cluster is a statewide effort, more permit applications were filed for new or expanded farms in Southeast than in any other region 2016 through 2022, according to state statistics.
Southeast set a record last year with seven applications for seaweed and shellfish farms, bringing to 37 the permit applications in Southeast since 2016. Elsewhere around the state, 30 applications were filed for new or expanded farms in Southcentral 2016-2022, and 23 in the Kodiak area.
In 2022, there were 13 operating oyster farms in Alaska, totaling almost $1.5 million in sales, and eight producing seaweed farms around the state, with two dozen more permitted and just as many under review.
The young industry, which grossed $2 million in sales last year, hopes to expand to between $60 million and $185 million a year by 2032.
Managing a new program with government grant money has its challenges, Leggitt said. “Federal grants have a lot of different restrictions and requirements,” but the federal agency has been helpful with the new venture, she said.
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