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The potential and a strategy for managing and developing marine plant resources in British Columbia Lewis, Kevin M. 1985

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THE POTENTIAL AND A STRATEGY FOR MANAGING AND DEVELOPING MARINE PLANT RESOURCES IN BRITISH COLUMBIA by KEVIN M. LEWIS B . S c , U n i v e r s i t y Of B r i t i s h C olumbia, 1978 A THESIS SUBMITTED IN PARTIAL FULFILMENT OF THE REQUIREMENTS FOR THE DEGREE OF MASTER OF SCIENCE i n THE FACULTY OF GRADUATE STUDIES Sc h o o l Of Community And R e g i o n a l P l a n n i n g We a c c e p t t h i s t h e s i s as co n f o r m i n g t o the r e q u i r e d s t a n d a r d THE UNIVERSITY OF BRITISH COLUMBIA October 1985 © K e v i n M. L e w i s , 1 985 . In p r e s e n t i n g t h i s t h e s i s i n p a r t i a l f u l f i l m e n t of the r e q u i r e m e n t s f o r an advanced degree a t the U n i v e r s i t y of B r i t i s h C o l umbia, I a g r e e t h a t the L i b r a r y s h a l l make i t f r e e l y a v a i l a b l e f o r r e f e r e n c e and s t u d y . I f u r t h e r agree t h a t p e r m i s s i o n f o r e x t e n s i v e c o p y i n g of t h i s t h e s i s f o r s c h o l a r l y purposes may be g r a n t e d by the Head of my Department or by h i s or her r e p r e s e n t a t i v e s . I t i s u n d e r s t o o d t h a t c o p y i n g or p u b l i c a t i o n of t h i s t h e s i s f o r f i n a n c i a l g a i n s h a l l not be a l l o w e d w i t h o u t my w r i t t e n p e r m i s s i o n . Department of S c h o o l Of Community And R e g i o n a l P l a n n i n g The U n i v e r s i t y of B r i t i s h Columbia 2075 Wesbrook P l a c e Vancouver, Canada V6T 1W5 i i A b s t r a c t T h i s t h e s i s a s s e s s e s the p o t e n t i a l and s u g g e s t s s t r a t e g i e s f o r the development of marine p l a n t r e s o u r c e s on the Canadian west c o a s t . Three s u b - o b j e c t i v e s have been c o n s i d e r e d t o de t e r m i n e t h e k i n d of marine p l a n t management s t r a t e g i e s t h a t a r e n e c e s s a r y to a s s e s s and d e v e l o p the i n d u s t r y i n B r i t i s h C o l umbia. The a n a l y t i c a l framework of the t h e s i s h i n g e s on thes e q u e s t i o n s . 1. What i s the p h y s i c a l p o t e n t i a l f o r growing and h a r v e s t i n g t h e s e marine p l a n t s on the Canadian west c o a s t and what p r o d u c t s might be produced? 2. What i s the p o t e n t i a l market f o r marine p l a n t p r o d u c t s and what a r e the economics of p r o d u c t i o n i n B r i t i s h C olumbia? 3. What s h o u l d be the components of a s t r a t e g y f o r d e v e l o p i n g an i n d u s t r y i n B r i t i s h Columbia? These o b j e c t i v e s have been met through l i t e r a t u r e r e v i e w s and a s e r i e s of p e r s o n a l i n t e r v i e w s . In 1976, the c u m u l a t i v e commercial v a l u e of the w o r l d ' s marine p l a n t i n d u s t r i e s was a p p r o a c h i n g U.S. $1 B i l l i o n . The Japanese d o m e s t i c i n d u s t r y a l o n e g e n e r a t e d an a n n u a l v a l u e of a p p r o x i m a t e l y U.S. $700 M i l l i o n . World t r a d e i n e d i b l e marine p l a n t s and a l l marine p l a n t p r o d u c t s was e s t i m a t e d a t U.S. $140 M i l l i o n . Of t h i s i n t e r n a t i o n a l t r a d e , p h y c o c o l l o i d s (marine p l a n t c o l l o i d s ) and t h e i r raw m a t e r i a l s c o n s t i t u t e d the dominant economic s h a r e . S i n c e p r e l i m i n a r y a t t e m p t s , i n 1946, t o d e v e l o p a marine p l a n t o p e r a t i o n i n B r i t i s h Columbia the h i s t o r y of the marine p l a n t i n d u s t r y has been one of d i s a p p o i n t m e n t . A s e r i e s of f a i l e d development a t t e m p t s has p l a g u e d the i n d u s t r y s i n c e i t s c o n c e p t i o n . At t h i s time a l i m i t e d marine p l a n t i n d u s t r y has e s t a b l i s h e d on the west c o a s t . These o p e r a t i o n s are s m a l l i n s c a l e and r e l y on the h a r v e s t of l o c a l i z e d w i l d and c u l t u r e d s t o c k s . T h i s study f o c u s e s on s i x marine p l a n t s p e c i e s and i d e n t i f i e s k e l p meal and r o e - o n - k e l p as e c o n o m i c a l l y v i a b l e p r o d u c t s a t t h i s t i m e . A number of s m a l l - s c a l e o p e r a t i o n s have de v e l o p e d around the r o e - o n - k e l p s e c t o r but a d m i n i s t r a t i v e / j u r i s d i c t i o n a l c o n s t r a i n t s have p r e v e n t e d the e s t a b l i s h m e n t of a commercial s c a l e k e l p meal o p e r a t i o n . Three p r i o r i t i e s f o r the development of marine p l a n t r e s o u r c e s emerge from t h i s s t u d y : 1. t o p r o v i d e a p r o c e s s which p e r m i t s the e x p r e s s i o n and i n c o r p o r a t i o n of the i n t e r e s t s of a f f e c t e d r e s o u r c e u s e r s ; 2. a need f o r an i m p l e m e n t a t i o n p r o c e s s ; and • 3. a need t o r e s e r v e c r i t i c a l r e s o u r c e beds to p r e v e n t encroachment of unsympathetic a c t i v i t i e s . The t h e s i s c o n c l u d e s by i l l u s t r a t i n g t h a t a s t r a t e g i c p l a n n i n g p r o c e s s p r o v i d e s an a p p r o p r i a t e p r o c e d u r e t o implement the s e p r i o r i t i e s . Recommendations f o r i n d u s t r i a l development and management are d i s c u s s e d under f o u r c a t e g o r i e s : i v Who s h o u l d do the p l a n n i n g and management? What s h o u l d the c o - o r d i n a t i n g body be d o i n g How t o implement the s t r a t e g i c p l a n ? When s h o u l d t h e s e e f f o r t s begin? V T a b l e of C o n t e n t s A b s t r a c t i i L i s t of T a b l e s v i i i C hapter I INTRODUCTION 1 Chapter I I A DESCRIPTION OF THE MARINE PLANT RESOURCE AND THE PRODUCTS THAT MIGHT BE PRODUCED 6 1. INTRODUCTION 6 2. POTENTIAL FOR GROWING AND GATHERING MARINE PLANTS IN BRITISH COLUMBIA 6 2.1 B i o l o g y And D i s t r i b u t i o n Of C o m m e r c i a l l y Important M a r i n e P l a n t s 6 2.1.1 L i f e H i s t o r i e s And Growth P a t t e r n s 7 2.1.2 S t o c k s 11 2.1.3 H a r v e s t i n g 13 2.1.4 P o p u l a t i o n Dynamics, E c o l o g y And Commercial Q u a l i t y C r i t e r i a 16 2.2 M a r i c u l t u r e 17 3. POTENTIAL PRODUCTS PRODUCED IN BRITISH COLUMBIA BY FURTHER PROCESSING OF WILD HARVEST/MARICULTURE PLANTS .21 3.1 C h e m i c a l E x t r a c t s 21 3.2 P r e s e n t P r o d u c t s Produced In B r i t i s h Columbia 23 3.3 P o t e n t i a l P r o d u c t s 24 4. CONCLUSIONS 28 Chapter I I I MARKET SUPPLY AND DEMAND AND THE ECONOMICS OF PRODUCT PRODUCTION IN BRITISH COLUMBIA 29 1. INTRODUCTION 29 2. NEREOCYSTIS/MACROCYSTIS- WILD STOCK KELPS 30 2.1 Supply And Demand 31 2.1.1 Roe-on-kelp 31 2.1.2 F e r t i l i z e r 31 2.1.3 Kelp-meal 32 2.1.4 Che m i c a l E x t r a c t s 35 2.2 Market S c e n a r i o s And The C o s t s Of P r o d u c t i o n I n B r i t i s h Columbia '. 36 2.2.1 Roe-on-kelp 36 2.2.2 Kelp-meal 37 2.2.3 C h e m i c a l E x t r a c t s 39 2.3 Summary 39 3. LAMINARIA/CYMATHERE-KOMBU 40 3.1 Supply 40 3.2 Demand 42 3.3 Market S c e n a r i o s For B r i t i s h Columbia P r o d u c t s ....44 3.4 C o s t s Of P r o d u c t i o n In B r i t i s h Columbia 47 3.5 Summary 49 4. PORPHYRA-NORI 49 4.1 Supply 50 4.2 Demand 52 4.3 Market S c e n a r i o s For B r i t i s h Columbia N o r i 54 4.4 C o s t s Of P r o d u c t i o n 56 4.5 Summary 58 5. GELIDIUM-BACTERIOLOGICAL GRADE AGAR 59 5.1 Supply And Demand 59 5.2 Market S c e n a r i o s 61 5.3 C o s t s Of P r o d u c t i o n 63 5.4 Summary 64 6. CONCLUSIONS ...66 Cha p t e r IV INSTITUTIONAL OPPORTUNITIES AND CONSTRAINTS 68 1. INTRODUCTION 68 2. HISTORICAL OVERVIEW OF SEAWEED ENTERPRISES IN BRITISH COLUMBIA 68 2.1 C a t e g o r i z a t i o n Of F a i l u r e s 74 3. LEGISLATIVE JURISDICTION AND INSTITUTIONAL ARRANGEMENTS FOR THE MANAGEMENT OF MARINE PLANTS 75 3.1 J u r i s d i c t i o n a l I s s u e s 76 3.1.1 Marine P l a n t F i s h e r y 76 3.1.2 Marine P l a n t P r o d u c t s 79 3.1.3 N a v i g a t i o n . .80 3.1.4 Environment 80 3.2 F e d e r a l And P r o v i n c i a l Government A g e n c i e s 81 3.2.1 Department Of F i s h e r i e s And Oceans (DFO) 82 3.2.2 F i s h e r i e s Branch ( P r o v i n c i a l M i n i s t r y Of The Environment) '. ...84 3.2.3 M i n i s t r y Of Lands, P a r k s And Housing ...88 3.2.4 Other R e g u l a t o r y A g e n c i e s 89 3.2.5 A n c i l l a r y A g e n c i e s I n c l u d i n g P r i v a t e Companies And F o u n d a t i o n s 90 4. KEY INDUSTRIAL OPPORTUNITIES AND CONSTRAINTS 91 5. PRIORITIES FOR THE DEVELOPMENT OF MARINE PLANT RESOURCES IN BRITISH COLUMBIA 93 Chapter V COMPONENTS TO A STRATEGIC PLAN FOR THE MANAGEMENT AND DEVELOPMENT OF A MARINE PLANT INDUSTRY IN BRITISH COLUMBIA 98 1. INTRODUCTION 98 2. RATIONALE FOR A STRATEGIC PLANNING PROCESS BASED ON ASPIRATIONS TO LIBERAL DEMOCRATIC PRINCIPLES 99 3. MODIFICATIONS TO COMPLY WITH STRATEGIC PLANNING 102 4. IMPLEMENTATION CONSIDERATIONS 104 4.1 Who S h o u l d Do The P l a n n i n g And Management? 104 4.2 What S h o u l d The C o - o r d i n a t i n g Body Be Doing? 105 4.3 How To Implement The S t r a t e g i c P l a n ? 107 4.4 When Shoul d These E f f o r t s Begin? 108 BIBLIOGRAPHY 109 v i i i L i s t of T a b l e s 1. Summary of Growing and H a r v e s t i n g P o t e n t i a l 20 2. Range of P o t e n t i a l P r o d u c t s 27 3. Summary of Economic F e a s i b i l i t y of P o t e n t i a l P r o d u c t s 65 1 I . INTRODUCTION The o b j e c t i v e of t h i s t h e s i s i s t o a s s e s s the p o t e n t i a l and suggest s t r a t e g i e s f o r the development of marine p l a n t r e s o u r c e s on the Canadian west c o a s t . At l e a s t 476 marine p l a n t s p e c i e s r e p r e s e n t i n g 187 genera have been documented ( S c a g e l , 1967) a l o n g B r i t i s h Columbia's 27,000 k i l o m e t r e c o a s t l i n e . However, I c o n c l u d e t h e r e i s a consensus among government, i n d u s t r y and academic s o u r c e s t h a t o n l y s i x marine p l a n t t a x a appear t o meet the minimum r e q u i r e m e n t s f o r i n d u s t r i a l development a t t h i s t i m e . These r e q u i r e m e n t s l i m i t a t t e n t i o n t o i n d i g e n o u s w i l d and c u l t u r e d s t o c k s , c o n s i s t i n g of s p e c i e s w i t h commercial v a l u e , t h a t can be e c o n o m i c a l l y h a r v e s t e d by methods t h a t do not n e g a t i v e l y impact the ecosystem. These s i x s p e c i e s a r e : N e r e o c y s t i s l u e t k e a n a , M a c r o c y s t i s i n t e g r i f o l i a , L a m i n a r i a  g r o e n l a n d i c a , Cymathere t r i p l i c a t a , P o r p h y r a supp., and G e l i d i u m supp.. In 1976, N a y l o r r e p o r t e d t h a t the c u m u l a t i v e commercial v a l u e of the w o r l d ' s marine p l a n t i n d u s t r i e s was a p p r o a c h i n g U.S. $1 B i l l i o n . These i n d u s t r i e s can be c a t e g o r i z e d on the b a s i s of end-product u t i l i z a t i o n ; p r i n c i p a l l y e d i b l e seaweeds f o r consumption and p h y c o c o l l o i d s (seaweed c o l l o i d s ) w i t h d i v e r s e i n d u s t r i a l a p p l i c a t i o n s . To a l e s s e r e x t e n t seaweeds have a l s o h e l d a t r a d i t i o n a l , though not e x c l u s i v e , r o l e i n the p r o d u c t i o n of a n i m a l feeds and f e r t i l i z e r s . To p l a c e the e d i b l e seaweed i n d u s t r y i n r e l a t i v e commercial 2 p e r s p e c t i v e i t s h o u l d be noted t h a t i n Japan (the s i n g l e most i m p o r t a n t consumer and pro d u c e r of e d i b l e seaweeds) the domestic i n d u s t r y a l o n e g e n e r a t e s an a n n u a l v a l u e of a p p r o x i m a t e l y U.S. $700 M i l l i o n . N a y l o r (1976) e s t i m a t e d w o r l d t r a d e i n e d i b l e seaweeds and a l l seaweed p r o d u c t s a t U.S. $140 M i l l i o n . Of t h i s i n t e r n a t i o n a l t r a d e , p h y c o c o l l o i d s and t h e i r raw m a t e r i a l s c o n s t i t u t e d the dominant economic s h a r e . P r o d u c t s t h a t might be d e r i v e d from the s i x t a r g e t e d west c o a s t s p e c i e s i n c l u d e e d i b l e s , c h e m i c a l e x t r a c t s , f e r t i l i z e r s and p r o d u c t s w i t h m e d i c a l a p p l i c a t i o n s . T h i s t h e s i s w i l l a s s e s s the p o t e n t i a l f o r development of the s e p r o d u c t s and suggest a p p r o p r i a t e p l a n n i n g and management s t r a t e g i e s . In a r e v i e w of c o a s t a l r e s o u r c e s and " t h e i r c o n t r i b u t i o n t o economic development i n B r i t i s h C o lumbia, Dorcey (1979) argues t h a t u n l e s s managers w i t h i n b o t h i n d u s t r y and government r e c o g n i z e the e n v i r o n m e n t a l and economic u n c e r t a i n t i e s t h a t a re common t o s m a l l e r f i s h e r y / m a r i c u l t u r e e n t e r p r i s e s such as the marine p l a n t i n d u s t r y , these e n t e r p r i s e s w i l l c o n t i n u e t o f a l l s h o r t of t h e i r a p p arent p o t e n t i a l . Adapted from Dorcey's r e v i e w (1979), t h r e e q u e s t i o n s a r e s u g g e s t e d t o de t e r m i n e t h e k i n d of marine p l a n t management s t r a t e g i e s t h a t a r e n e c e s s a r y t o a s s e s s and d e v e l o p the i n d u s t r y i n B r i t i s h Columbia. 1. What i s the p h y s i c a l p o t e n t i a l f o r growing and h a r v e s t i n g t h e s e marine p l a n t s on the Canadian west c o a s t and what p r o d u c t s might be produced? 2. What i s the p o t e n t i a l market f o r marine p l a n t p r o d u c t s and what a r e the economics of p r o d u c t i o n i n B r i t i s h Columbia? 3 3. What s h o u l d be the components of a s t r a t e g y f o r d e v e l o p i n g an i n d u s t r y i n B r i t i s h Columbia? While t h i s approach t o the development of management s t r a t e g i e s has r e c e i v e d l i m i t e d c r i t i c a l a t t e n t i o n f o r s m a l l e r f i s h e r y / m a r i c u l t u r e . r e s o u r c e s i t i s not u n l i k e the approach used, i n o t h e r s e c t o r s , by any new v e n t u r e w i t h m a r k e t i n g and f i n a n c i n g c o n s t r a i n t s (Schewe e t a l , 1983). The need and v a l u e of p u b l i c s e c t o r involvement i n t h i s s tudy can be argued from two a n g l e s . The f i r s t i n v o l v e s economic o b j e c t i v e s . Government may s i m p l y view promotion and development of marine p l a n t r e s o u r c e s as a d e s i r a b l e means t o p r o v i d e j o b s t o remote c o a s t a l a r e a s f a c i n g l i m i t e d economic o p p o r t u n i t y . • A l t e r n a t i v e l y , government may accept a r e s p o n s i b i l i t y t o a s s e s s the o p p o r t u n i t i e s and c o n s t r a i n t s t o development of r e s o u r c e s ( l i k e marine p l a n t s ) which i n d u s t r y may have d i s m i s s e d as e i t h e r m a r g i n a l or h i g h r i s k . There i s v a l u e i n t h i s p u b l i c r o l e even i f o n l y t o determine the o p p o r t u n i t y c o s t s of not d e v e l o p i n g the r e s o u r c e . In the f o l l o w i n g c h a p t e r s each of the p r e c e d i n g q u e s t i o n s w i l l be examined f o r the marine p l a n t i n d u s t r y . The management c o n s i d e r a t i o n s posed by Q u e s t i o n 1 w i l l be a n a l y s e d i n Chapter I I . The c h a p t e r w i l l a d d r e s s : f i r s t , the p o t e n t i a l f o r growing and g a t h e r i n g the s i x marine p l a n t s p e c i e s and second, the range of p r o d u c t s t h a t might be o b t a i n e d from the h a r v e s t e d raw m a t e r i a l s . P a r t one of t h i s a n a l y s i s w i l l e i t h e r c o n f i r m or r e j e c t the u n t e s t e d s p e c u l a t i o n t h a t marine p l a n t s t o c k s of adequate s i z e and r e s i l i e n c y t o support 4 s u s t a i n e d h a r v e s t i n g a r e found on the west c o a s t . P a r t two w i l l argue t h a t the p r o c e s s e d raw m a t e r i a l s c o u l d have a p p l i c a t i o n s i n a range of e s t a b l i s h e d p r o d u c t s . Chapter I I I uses the r e s u l t s of the p r e c e e d i n g a n a l y s i s t o a s s e s s the markets and c o s t s of p r o d u c t i o n f o r p r e s e n t and proposed p r o d u c t s . T h i s i s the a n a l y s i s s u g g e s t e d by Q u e s t i o n 2. The r e s u l t s w i l l e s t a b l i s h whether markets e x i s t f o r the i d e n t i f i e d p r o d u c t s and whether the s e p r o d u c t s can be produced and d i s t r i b u t e d a t c o m p e t i t i v e p r i c e s . T h i s a n a l y s i s i s a p p l i e d t o each p r o d u c t and i n v o l v e s t h r e e s t e p s : one, t o re v i e w market s u p p l y and demand t o d e t e r m i n e whether t h e r e a r e or c o u l d be u n s a t i s f i e d demands and t o note 0 p r i c e s commanded by each p r o d u c t ; two, t o suggest market s c e n a r i o s ( i n c l u d i n g s t r a t e g i e s f o r the c o m p e t i t i o n of west c o a s t p r o d u c t s i n the i d e n t i f i e d m a r k e t s ) ; and t h r e e , t o determine t h e c o s t s of p r o d u c t p r o d u c t i o n . Chapter IV w i l l p r e s e n t a b r i e f r e v i e w of p a s t i n d u s t r i a l a c t i v i t y on the west c o a s t and drawing from the c o n c l u s i o n s of C h a p t e r s I I and I I I w i l l i d e n t i f y key i n d u s t r i a l o p p o r t u n i t i e s and c o n s t r a i n t s . The c h a p t e r w i l l t hen t u r n t o c o n c l u s i o n s about p r i o r i t i e s f o r development. Assuming i t i s demonstrated t h a t B r i t i s h Columbia p r o d u c t s might compete i n the m a r k e t p l a c e , C h a p t e r V w i l l suggest the components of an a p p r o p r i a t e s t r a t e g y t o f a c i l i t a t e t he o p p o r t u n i t y f o r management and development of the i n d u s t r y . T h i s s t r a t e g y must be c o g n i z a n t of the c o n c l u s i o n s of Chapter IV and i t i s suggested t h a t s t r a t e g i c p l a n n i n g p r o v i d e s an 5 e f f e c t i v e p r o c e d u r e t o a c h i e v e t h i s g o a l . 6 I I . A DESCRIPTION OF THE MARINE PLANT RESOURCE AND THE PRODUCTS THAT MIGHT BE PRODUCED 1. INTRODUCTION T h i s c h a p t e r examines the p h y s i c a l p o t e n t i a l f o r growing the s i x marine p l a n t s p e c i e s i n West Coast waters and i d e n t i f i e s the p r o d u c t s t h a t might be produced. The a n a l y s i s i n c l u d e s a re v i e w of l i f e h i s t o r i e s and growth p a t t e r n s , s t o c k s , h a r v e s t i n g methods and m a r i c u l t u r e o p p o r t u n i t i e s . The d e s c r i p t i o n of p r o d u c t s d i s c u s s e s the v a l u e of c h e m i c a l e x t r a c t s , the range of p r e s e n t p r o d u c t i o n and the p o t e n t i a l t o expand i n t o new marine p l a n t d e r i v e d p r o d u c t s . 2. POTENTIAL FOR GROWING AND GATHERING MARINE PLANTS IN BRITISH COLUMBIA 2.1 B i o l o g y And D i s t r i b u t i o n Of C o m m e r c i a l l y Important Marine P l a n t s T h i s s e c t i o n on b i o l o g y c o n c e n t r a t e s on the l i f e of the s i x marine p l a n t s p e c i e s and i d e n t i f i e s s e v e r a l t h a t p r o v i d e i n f o r m a t i o n f o r a marine p l a n t management h i s t o r i e s v a r i a b l e s s t r a t e g y . 7 For example, an u n d e r s t a n d i n g of r e p r o d u c t i v e l i f e h i s t o r y i s n e c e s s a r y t o p r e d i c t the i n f l u e n c e of h a r v e s t i n g on f u t u r e r e c r u i t m e n t . In a d d i t i o n , s e a s o n a l changes i n p h y s i c a l and c h e m i c a l c h a r a c t e r i s t i c s g r e a t l y i n f l u e n c e the q u a l i t y of the end p r o d u c t . 2.1.1 L i f e H i s t o r i e s And Growth P a t t e r n s S c a g e l (1967), s t a t e s t h a t the l i f e h i s t o r i e s of the a l g a e a r e among the most complex and v a r i e d of a l l p l a n t groups. He notes t h a t as i n a l l s e x u a l l y r e p r o d u c i n g organisms, when syngamy ( f u s i o n of gametes- sex c e l l s ) o c c u r s , m e i o s i s (a r e d u c t i o n d i v i s i o n i n which the number of chromosomes i s reduced from the d i p l o i d s t a t e - s i n g l e s e t of p a i r e d chromosomes- t o the h a p l o i d s t a t e - s i n g l e s e t of u n p a i r e d chromosomes) must f o l l o w ; hence an a l t e r n a t i o n of g e n e r a t i o n s i n the l i f e c y c l e . The a l t e r n a t i o n of g e n e r a t i o n s r e f e r s t o an a l t e r n a t i o n between the s e x u a l gamete-producing phase and the m e i o s p o r e - p r o d u c i n g stage ( S c a g e l , e t a l , 1982). There a r e a number of v a r i a t i o n s i n t h i s b a s i c theme. However, the l i f e h i s t o r i e s of the c o m m e r c i a l l y i m p o r t a n t marine p l a n t s can be d i v i d e d i n t o t h r e e b a s i c t y p e s . The genera N e r e o c y s t i s , M a c r o c y s t i s , L a m i n a r i a , and Cymathere r e p r e s e n t one type of l i f e h i s t o r y . These brown a l g a e ( k e l p ) d i s p l a y an a l t e r a t i o n of g e n e r a t i o n s between a macroscopic sporophyte and a m i c r o s c o p i c gametophyte stage ( S c a g e l , e t a l , 1982). The c o n s p i c u o u s s p o r o p h y t e s of each 8 s p e c i e s a r e of commercial i n t e r e s t . The r e d a l g a e P o r p h y r a and G e l i d i u m p r o v i d e two v a r i a t i o n s of t h i s t y p e of l i f e h i s t o r y . For P o r p h y r a t h e r e i s a h e t e r o m o r p h i c ( m o r p h o l o g i c a l l y u n l i k e ) a l t e r n a t i o n of g e n e r a t i o n s between the m a c r o s c o p i c and m i c r o s c o p i c s t a g e s and t h e r e i s c o n s i d e r a b l e a s e x u a l r e p r o d u c t i o n . The l i f e h i s t o r y of G e l i d i u m p r e s e n t s a d d i t i o n a l c o m p l e x i t i e s t h a t a r e not s u i t e d t o a g e n e r a l d i s c u s s i o n , however, the c o n s p i c u o u s g e n e r a t i o n i s the s u b j e c t of commercial i n t e r e s t . N e r e o c y s t i s l u e t k e a n a i s the most abundant k e l p i n B r i t i s h C o l u m b i a . S i n c e the h a r v e s t a b l e sporophyte i s u s u a l l y c a s t o f f d u r i n g w i n t e r storms i t i s c o n s i d e r e d an a n n u a l . A s i n g l e s t i p e ( s t a l k ) of up t o 25 metres grows from the h o l d f a s t (an a t t achment s t r u c t u r e ) and two c l u s t e r s of b l a d e s grow from the b a s a l m e r i s t e m a t i c (growth i n i t i a t i n g ) r e g i o n l o c a t e d between the b l a d e s and the b u l b of the s t i p e . T h i s p l a n t has an e x t r e m e l y l a r g e r e p r o d u c t i v e p o t e n t i a l w i t h peak spore p r o d u c t i o n o c c u r r i n g on l a m i n a near the sea s u r f a c e d u r i n g l a t e summer. On c e r t a i n p a r t s of the c o a s t beds of c o n s i d e r a b l e s i z e and d e n s i t y form w i t h the c a p a c i t y t o a c t as n a t u r a l b r e a k w a t e r s . N e r e o c y s t i s l u e t k e a n a a t t a c h e s t o r o c k s i n the upper s u b t i d a l zone and t o a depth of about 10 fathoms. M a c r o c y s t i s i n t e g r i f o l i a i s the o n l y s p e c i e s of t h i s genus r e c o r d e d i n B r i t i s h C o lumbia. I t , l i k e N e r e o c y s t i s , employs two methods of r e p r o d u c t i o n . Rather than r e l e a s i n g m i c r o s c o p i c z o o s p o r e s from laminae l o c a t e d near the sea s u r f a c e as i n N e r e o c y s t i s , M a c r o c y s t i s z oospores a r e r e l e a s e d from the 9 s p o r o p h y l l s ( l e a f - l i k e s t r u c t u r e i n which s p o r e s a r e produced) l o c a t e d near the base of the p l a n t . These z o o s p o r e s d e v e l o p i n t o m i c r o s c o p i c male and female gametophytes which i n t u r n produce gametes which u n i t e t o form the f e r t i l i z e d egg c e l l , the z y g o t e . T h i s c e l l then d e v e l o p s i n t o a new ma c r o s c o p i c s p o r o p h y t e . Neushul (1959; c i t e d i n C l e n d e n n i n g , 1961) s t a t e s t h a t f o r M a c r o c y s t i s about two months a r e r e q u i r e d f o r the p r o d u c t i o n of v i s i b l e s p o r o p h y t e s from z o o s p o r e s and a t l e a s t a ye a r f o r the s e x u a l p r o d u c t i o n of mature p l a n t s b e a r i n g canopy. A mature p l a n t of M a c r o c y s t i s i n t e g r i f o l i a may have s t i p e s as l o n g as 30 metres w i t h as many as 30-40 s t i p e s growing from a s i n g l e h o l d f a s t . L e a f - l i k e laminae a r e a t t a c h e d t o the s e s t i p e s a t i n t e r v a l s and a t the p o i n t of attachment the laminae t a p e r t o s m a l l g a s - f i l l e d b u l b s , the pneumatocysts. S c a g e l (1961), r e p o r t s t h a t a s i n g l e p l a n t may weigh up t o 45 k i l o g r a m s . In a d d i t i o n t o s e x u a l r e p r o d u c t i o n , i n mature beds, v e g e t a t i v e s p l i t t i n g of mature h o l d f a s t s p r o v i d e s a d d i t i o n a l new p l a n t s . The w e l l - i l l u m i n a t e d s u r f a c e f r o n d s of M a c r o c y s t i s s u s t a i n t h e lower p a r t s by t r a n s l o c a t i o n of food m a t e r i a l down the c o n d u c t i n g elements of the s t i p e s ( C l e n d e n n i n g , 1961). T h i s f e a t u r e p e r m i t s new f r o n d s t o d e v e l o p above e s t a b l i s h e d h o l d f a s t s and grow r a p i d l y upward i n s t i p e b u n d l e s from m u l t i p l e m e r i s t e m a t i c r e g i o n s . New f r o n d s growing v e g e t a t i v e l y can grow under dense l i g h t - r e d u c i n g c a n o p i e s which p r e c l u d e the e s t a b l i s h m e n t and development of competing a l g a e . The sp o r o p h y t e phase of M a c r o c y s t i s i s c o n s i d e r e d t o be p e r e n n i a l and i s found on r o c k s i n the lowermost i n t e r t i d a l and upper 10 s u b t i d a l zones t o a depth of about 4 fathoms. T h i s p l a n t grows i n a r e a s of c o n s i s t e n t l y h i g h s a l i n i t y or where low s a l i n i t i e s o c c ur o n l y d u r i n g the c o l d w i n t e r months ( D r u e h l , 1978). I t r e q u i r e s p r o t e c t i o n from s t r o n g wave a c t i o n and i s o f t e n p r o t e c t e d by a f r i n g e of N e r e o c y s t i s growing i n deeper wat e r . The genus L a m i n a r i a i s r e p r e s e n t e d i n B r i t i s h Columbia by a t l e a s t seven s p e c i e s . However, because of p r e f e r r e d f l a v o u r L a m i n a r i a g r o e n l a n d i c a i s c o n s i d e r e d t o have the b e s t economic p o t e n t i a l (Woods, Gordon and Co., 1978). L a m i n a r i a g r o e n l a n d i c a has a p e r e n n i a l b l a d e t h a t i s 20 t o 150 c e n t i m e t r e s (cm.) l o n g and 11 t o 45 cm. wide ( D r u e h l , 1980b). The s t i p e i s 10 t o 30 cm. l o n g and i s a t t a c h e d t o r o c k s by a branched h o l d f a s t i n the lower i n t e r t i d a l and upper s u b t i d a l zones ( F r a l i c k and T i l l a p a u g h , 1979). Cymathere t r i p l i c a t a i s the o n l y s p e c i e s of the genus r e c o r d e d from B r i t i s h Columbia. T h i s e d i b l e brown a l g a i s a t t a c h e d t o r o c k s i n the upper s u b t i d a l zone by a prominent d i s c o i d h o l d f a s t . Near the h o l d f a s t the s t i p e i s c y l i n d r i c a l but over i t s l e n g t h , which may r e a c h up t o 25 cm., the s t i p e f l a t t e n s and merges i n t o a s i n g l e , l o n g , narrow b l a d e . T h i s b l a d e i s the d o m i n a t i n g f e a t u r e of the p l a n t and may grow t o a l e n g t h of 4 metres and a w i d t h of 18 cm. Cymathere t r i p l i c a t a can be d e s c r i b e d as an annual s p e c i e s ( D r u e h l , 1980 b ) . Conway, e t a l (1975), r e p o r t t h a t 16 s p e c i e s of Porphyra a r e r e p r e s e n t e d i n B r i t i s h C olumbia. These marine p l a n t s p e c i e s grow under a broad range of e n v i r o n m e n t a l c o n d i t i o n s and are found on r o c k s or e p i p h y t i c on o t h e r a l g a e i n the i n t e r t i d a l and 11 upper s u b t i d a l zones. The b l a d e s v a r y i n s i z e and shape and range from a few c e n t i m e t r e s t o over a metre i n l e n g t h . F r a l i c k and T i l l a p a u g h (1979), r e p o r t t h a t Porphyra s p e c i e s a r e most abundant d u r i n g the s p r i n g months. S c a g e l (p. c.) i n d i c a t e s t h a t P o r p h y r a can be c o n s i d e r e d an annual p l a n t . F i n a l l y , s e v e r a l s p e c i e s of the genus G e l i d i u m a r e r e c o r d e d from B r i t i s h Columbia. Growth of the gametophyte i s by a s i n g l e a p i c a l (end) c e l l from which i s d e r i v e d an a x i a l f i l a m e n t ( s e r i e s of c e l l s r u n n i n g through the c e n t r e of an a x i s or b r a n c h ) . S c a g e l (1967), e x p l a i n s t h a t c e l l s a r i s e from the a x i a l f i l a m e n t i n f o u r m u t u a l l y p e r p e n d i c u l a r segments and t e r m i n a t e a t t h e s u r f a c e i n p r o g r e s s i v e l y s m a l l e r c e l l s . G e l i d i u m , o c c u r s i n t u f t s on r o c k s i n the lower i n t e r t i d a l t o upper s u b t i d a l zones and appears t o be p e r e n n i a l from the base ( S c a g e l p. c . ) . 2.1.2 S t o c k s S t o c k s of c o m m e r c i a l l y i m p o r t a n t marine p l a n t s a r e l o c a t e d throughout the B r i t i s h Columbia c o a s t . However, t h e r e a r e l i m i t e d l o c a t i o n s where the s e p l a n t s are n a t u r a l l y found i n q u a n t i t i e s and of a q u a l i t y t h a t can support an e c o n o m i c a l l y f e a s i b l e h a r v e s t i n g programme ( F r a l i c k and T i l l a p a u g h , 1979). P l a n t s t o c k s t h a t a r e v a l u e d f o r c h e m i c a l e x t r a c t s t e n d t o be m e c h a n i c a l l y h a r v e s t e d and a c e r t a i n minimum l e v e l of biomass per u n i t a r e a i s r e q u i r e d t o p e r m i t the h a r v e s t i n g equipment t o 12 o p e r a t e e f f i c i e n t l y . In a d d i t i o n , t h e s e s t a n d s must p r o v i d e a minimum t o t a l s t a n d i n g s t o c k f o r an e c o n o m i c a l l y v i a b l e h a r v e s t i n g o p e r a t i o n . In c o n t r a s t , s p e c i e s h a r v e s t e d f o r foo d p r o d u c t s command a h i g h e r d o l l a r v a l u e (by w e i g h t ) ; hand h a r v e s t i n g of such s p e c i e s i s p l a u s i b l e and s m a l l e r t o t a l a c c e s s i b l e s t o c k s a r e presumably r e q u i r e d t o a t t a i n commercial f e a s i b i l i t y . An i n v e n t o r y program has been c a r r i e d out t o l o c a t e and q u a n t i f y the s t a n d i n g c r o p of c o m m e r c i a l l y a t t r a c t i v e c o n c e n t r a t i o n s of M a c r o c y s t i s and N e r e o c y s t i s . The s u r f a c e canopy f o r m i n g n a t u r e of t h e s e s p e c i e s p e r m i t s the use of a e r i a l photography t o measure bed l o c a t i o n , a r e a and p l a n t d e n s i t y . On the b a s i s of observed canopy presence almost 670 km. of s h o r e l i n e have been su r v e y e d and an e s t i m a t e d 540,000 wet tonnes of b o t h s p e c i e s have been found w i t h i n beds c o v e r i n g over 11,600 ha. S m a l l e r k e l p s such as L a m i n a r i a and the r e d seaweeds a r e much more d i f f i c u l t t o i n v e n t o r y and i n v e n t o r y c o s t s must be weighed a g a i n s t p r o b a b l e commercial b e n e f i t s . L o c a l i z e d i n v e n t o r i e s of L a m i n a r i a , Cymathere and Po r p h y r a s t o c k s have been c a r r i e d out i n the M a l c o l m and Langara I s l a n d a r e a s , r e s p e c t i v e l y , i n response t o s p e c i f i c commercial developments. E d i b l e marine p l a n t s a r e a l s o the f o c u s of m a r i c u l t u r e i n t e r e s t . I n t h i s c a s e , s t o c k l o c a t i o n i s l a r g e l y r e p l a c e d by the i d e n t i f i c a t i o n of a r e a s w i t h a c c e p t a b l e growing c o n d i t i o n s . 13 2.1.3 H a r v e s t i n g The b i o l o g y and d i s t r i b u t i o n of the c o m m e r c i a l l y i m p o r t a n t marine p l a n t s have been c o n s i d e r e d ; y e t i n the f i n a l a n a l y s i s the p o t e n t i a l a v a i l a b i l i t y of marine p l a n t s t o c k s i s a f u n c t i o n of h a r v e s t i n g s t r a t e g i e s and t e c h n o l o g i e s . H a r v e s t i n g s t r a t e g i e s a r e det e r m i n e d by f o r e c a s t s of how the p l a n t s and bed e c o l o g y w i l l respond to the e f f e c t s of h a r v e s t i n g . R e c o g n i z e d m o n i t o r i n g parameters f o r marine p l a n t s i n c l u d e a n n u a l and s e a s o n a l changes i n s t a n d i n g c r o p , growth r a t e , r e p r o d u c t i o n and r e c r u i t m e n t and b i o c h e m i c a l c o m p o s i t i o n . H a r v e s t i n g t e c h n o l o g i e s r e f e r t o the methods of removing marine p l a n t s from t h e i r growing environment. The l i f e h i s t o r i e s and growing p a t t e r n s of marine p l a n t s pose n a t u r a l l i m i t a t i o n s on the a v a i l a b i l i t y of p l a n t m a t e r i a l f o r an on-going h a r v e s t i n g s t r a t e g y . Commercial p r o d u c t a c c e p t a n c e imposes f u r t h e r l i m i t a t i o n s . A s u c c e s s f u l h a r v e s t i n g s t r a t e g y must t h e r e f o r e n e g o t i a t e a b a l a n c e between r e s o u r c e c o n s e r v a t i o n and p r o d u c t q u a l i t y . For example, f o r M a c r o c y s t i s , the management s t r a t e g y must ta k e i n t o account f r e q u e n c y and season of c u t t i n g and h e i g h t above the seabed t o ensure r e -e s t a b l i s h m e n t and re-growth f o r subsequent h a r v e s t s . As a management t o o l h a r v e s t i n g r e g u l a t i o n s a r e i n t e n d e d t o e n a b l e the o b j e c t i v e s of the v a r i o u s s p e c i e s s p e c i f i c h a r v e s t i n g s t r a t e g i e s . M a r ine p l a n t s a re h a r v e s t e d e i t h e r by hand or w i t h the a s s i s t a n c e of m e c h a n i c a l h a r v e s t e r s . However, the v a r i e t y of 14 morphology, d i s t r i b u t i o n and d e n s i t y of marine p l a n t s has d i c t a t e d t h a t the methods of h a r v e s t remain, i n most c a s e s , s m a l l - s c a l e and t r a d i t i o n a l . T h i s i m p l i e s a l a b o u r - i n t e n s i v e o p e r a t i o n w i t h one or more people h a n d - p i c k i n g or h a n d - r a k i n g the r e s o u r c e . Hand h a r v e s t i n g p r o v i d e s an o p p o r t u n i t y t o s e l e c t i v e l y choose or r e j e c t p l a n t s . T h i s reduces the h a r v e s t i n g impact w h i l e p r o v i d i n g an a c c e p t a b l e p r o d u c t f o r i n d u s t r i e s where h i g h q u a l i t y appearance i s a c r i t i c a l f a c t o r . M e c h a n i c a l h a r v e s t i n g has advantages when a l a r g e volume of h a r v e s t e d biomass i s the main o b j e c t i v e ; as i n the case of k e l p meal p r o d u c t i o n or c h e m i c a l e x t r a c t i o n . N e r e o c y s t i s and M a c r o c y s t i s a r e the two genera, from B r i t i s h C olumbia, f o r which s p e c i a l i z e d m e c h a n i c a l h a r v e s t i n g t e c h n i q u e s seem w e l l s u i t e d . In C a l i f o r n i a , s p e c i a l l y b u i l t p o w e r - d r i v e n barges equipped w i t h r e c i p r o c a t i n g underwater mowers are used t o c r o p M a c r o c y s t i s . With t h i s system a crew of f o u r men can h a r v e s t up t o 125 wet weight tonnes of k e l p i n f o u r t o f i v e hours ( D r u e h l , 1972). An arrangement o f . t h i s s o r t i s c o n s i d e r e d f u n c t i o n a l f o r the h a r v e s t of N e r e o c y s t i s and M a c r o c y s t i s i n B r i t i s h Columbia. Marine p l a n t p o p u l a t i o n s o c c u r r i n g i n the i n t e r t i d a l zone can be h a r v e s t e d w i t h l i t t l e d i f f i c u l t y . P o r p h y r a , f o r example, can be g a t h e r e d by hand from beaches a t low t i d e or by submerged vacuum d e v i c e s a t h i g h t i d e ( F r a l i c k and T i l l a p a u g h , 1979). G e l i d i u m i s g a t h e r e d by hand between t i d e s , by means of l o n g -h a n d l e d r a k e s i n s h a l l o w waters and by d i v e r s i n the deeper 1 5 s u b t i d a l zone. In Japan, the g r e a t e r p a r t of the G e l i d i u m h a r v e s t i s o b t a i n e d by d i v e r s w o r k i ng t o a depth of 10 metres. W h i l e h a r v e s t i n g by d i v e r s i s l a b o u r - i n t e n s i v e and c o s t l y , e x c e l l e n t y i e l d s have been r e p o r t e d . Japanese d i v e r s can h a r v e s t up t o 1 wet weight tonne of G e l i d i u m per day ( O k a z a k i , 1971; c i t e d i n N a y l o r , 1976). In B a j a C a l i f o r n i a a d i v e r , w o r k i ng from a boat w i t h a boat o p e r a t o r and l i f e - l i n e t e n d e r , can c o l l e c t up t o 1.5 wet weight tonnes d a i l y (Chapman, 1970; c i t e d i n N a y l o r , 1976). Mechanized h a r v e s t i n g has been d e v e l o p e d f o r L a m i n a r i a , however, the g r e a t e r p a r t of the h a r v e s t i s s t i l l taken i n the form of weed c a s t upon the shore d u r i n g s p r i n g storms. There i s agreement ( N a y l o r , 1976) t h a t the need f o r improved e f f i c i e n c y i n h a r v e s t i n g i s one of t h e g r e a t e s t problems f a c i n g the seaweed i n d u s t r y i n N o r t h A m e r i c a . Labour-i n t e n s i v e h a r v e s t i n g methods a r e becoming i n c r e a s i n g l y e x p e n s i v e and p r o h i b i t i v e . In the p r o d u c t i o n of p h y c o c o l l o i d s r o u g h l y h a l f the t o t a l expenses a r e raw m a t e r i a l c o s t s ( N a y l o r , 1976). The v i a b i l i t y of a N o r t h American based i n d u s t r y appears t o depend, i n p a r t , upon m i n i m i z i n g l a b o u r i n p u t s . By c o n t r a s t , i n d e v e l o p i n g c o u n t r i e s w i t h u n d e r e x p l o i t e d seaweed r e s o u r c e s and s u r p l u s l a b o u r a v i a b l e and c o m p e t i n g marine p l a n t i n d u s t r y c o u l d d e v e l o p w i t h e n t i r e l y d i f f e r e n t economic c o n s t r a i n t s and p u b l i c o b j e c t i v e s . 1 6 2.1.4 P o p u l a t i o n Dynamics, E c o l o g y And Commercial Q u a l i t y  C r i t e r i a C e r t a i n v a r i a b l e s have been r e c o g n i z e d as p r o v i d i n g the n e c e s s a r y i n f o r m a t i o n , f o r a marine p l a n t management s t r a t e g y . These v a r i a b l e s i n c l u d e : growth r a t e , b i o c h e m i c a l c o m p o s i t i o n , r e p r o d u c t i o n and r e c r u i t m e n t and f i n a l l y c o m p e t i t i o n w i t h i n the ecosystem (Coon, 1983). These same v a r i a b l e s a re a l s o i n d i c a t o r s of the marine p l a n t biomass a v a i l a b l e f o r commercial h a r v e s t i n g . For example, s e a s o n a l changes i n growth r a t e e x p l a i n , t o a degree, s e a s o n a l changes i n s t a n d i n g c r o p . T h i s r a t e of growth i s a consequence of l i m i t i n g e n v i r o n m e n t a l f a c t o r s such as te m p e r a t u r e , a v a i l a b l e n u t r i e n t s , l i g h t i n t e n s i t y and g r a z i n g ( N o r t h , 1978). The commercial v a l u e of marine p l a n t s i s det e r m i n e d by both appearance and b i o c h e m i c a l c o m p o s i t i o n . Coon (1983) i n d i c a t e s t h a t b i o c h e m i c a l c o n s i d e r a t i o n s i n c l u d e the v a r i a b i l i t y of : i . c a r b o h y d r a t e c o n t e n t - p a r t i c u l a r i l y p h y c o c o l l o i d s such as a l g i n and a g a r ; i i . p r o t e i n c o n t e n t ; ; i i i . f a t c o n t e n t ; i v . m i n e r a l c o n t e n t ; v. growth s t i m u l a t i n g a c t i v i t y t o a g r i c u l t u r a l s p e c i e s ; and- — v i . d i g e s t i b i l i t y and e d i b i l i t y t o humans and l i v e s t o c k . 1 7 F i n a l l y , the a v a i l a b i l i t y of marine p l a n t r e s o u r c e s w i l l be i n f l u e n c e d by: one, c o m p e t i t i o n w i t h o t h e r f l o r a and h e r b i v o r o u s fauna and; two, the p o s s i b l e need t o s e t a s i d e a r e s e r v e of u n h a r v e s t e d or p a r t i a l l y h a r v e s t e d marine p l a n t beds f o r the needs of a s s o c i a t e d f i s h e r y r e s o u r c e s (such as salmon and h e r r i n g ) . A l l of these v a r i a b l e s have t o be c o n s i d e r e d i n d e t e r m i n i n g the a v a i l a b i l i t y of the marine p l a n t r e s o u r c e on a s u s t a i n e d y i e l d b a s i s . 2 . 2 M a r i c u l t u r e A n o t i c e a b l e t r e n d i n the worldwide marine p l a n t i n d u s t r y i s the . movement towards c u l t u r e as a method f o r a c q u i r i n g new s u p p l i e s of raw m a t e r i a l . M a r i c u l t u r e o f f e r s the o p p o r t u n i t y b o t h t o produce a p r o d u c t w i t h improved commercial c h a r a c t e r i s t i c s and t o e x e r c i s e c o n t r o l over i t s r a t e of p r o d u c t i o n . As demand f o r marine p l a n t r e s o u r c e s has grown t o the l i m i t of t r a d i t i o n a l s u p p l i e s the i n d u s t r y has been f a c e d w i t h two o p t i o n s . One, t o e x t e n d i t s h a r v e s t of w i l d s t o c k s t o i n c l u d e a r e a s t h a t had p r e v i o u s l y been c o n s i d e r e d i n a c c e s s i b l e on the b a s i s of c o s t ; or two, the i n d u s t r y c o u l d t u r n t o e x t e n s i v e m a r i c u l t u r e (marine f a r m i n g ) o p e r a t i o n s . The second o p t i o n p r o v i d e s a t e c h n i c a l s o l u t i o n t o s u p p l y s h o r t a g e s ; from the g l o b a l p e r s p e c t i v e m a r i c u l t u r e i s emerging as the p r e f e r r e d o p t i o n . The c r i t i c a l f a c t o r s a t p l a y here a r e c o s t s and f l e x i b i l i t y of s u p p l y . 18 In f a c t , b i o t e c h n i c a l c a p a b i l i t i e s have been d e v e l o p e d i n B r i t i s h C o l u m b i a , Washington, Oregon, C a l i f o r n i a , C h i n a , Japan and o t h e r A s i a n c o u n t r i e s . These t e c h n i q u e s have the c a p a c i t y t o g r e a t l y enhance the n a t u r a l s t o c k s of a l l commercial marine a l g a e i n B r i t i s h Columbia. To date L a m i n a r i a g r o e n l a n d i c a , Cymathere t r i p l i c a t a and a w i n t e r growing s p e c i e s of G e l i d i u m have been s u c c e s s f u l l y c u l t u r e d i n B r i t i s h Columbia. W i l d p l a n t s of L a m i n a r i a g r o e n l a n d i c a have been grown and h a r v e s t e d on kombu farms. These p l a n t s were l a r g e r and l e s s l a c e r a t e d than e q u i v a l e n t p l a n t s c o l l e c t e d from the w i l d . C l o n i n g t e c h n i q u e s have produced a seed which has shown e x c e l l e n t growth on a kombu farm and may r e a c h m a t u r i t y i n a s h o r t e r growing season ( D r u e h l , 1981). Cymathere t r i p l i c a t a has been s u c c e s s f u l l y grown t o m a t u r i t y on kombu farms i n B a r k l e y Sound ( D r u e h l , 1981). Key e n v i r o n m e n t a l parameters d i s t i n g u i s h i n g the e x i s t i n g kombu farms have been i d e n t i f i e d and, as comparisons a re made of kombu growth, e n v i r o n m e n t a l p r e d i c t o r s w i l l emerge. These p r e d i c t o r s may a s s i s t the s e l e c t i o n of o p t i m a l kombu farm s i t e s . G e l i d i u m has been suggested as a c a n d i d a t e f o r c u l t u r e i n B r i t i s h Columbia because of the p o s s i b i l i t y of h i g h economic r e t u r n i f t h e agar c o n t e n t i s a b a c t e r i o l o g i c a l grade. D r s . Whyte and Foreman have s u c c e s s f u l l y c u l t u r e d t h i s (as y e t u n c l a s s i f i e d ) w i n t e r growing G e l i d i u m s p e c i e s and a r e now g e n e r a t i n g enough p l a n t m a t e r i a l t o - p r o c e e d w i t h an e x p e r i m e n t a l e x t r a c t i o n and a n a l y s i s of the agar (Whyte, p . c ) . I f p r e l i m i n a r y r e s u l t s a r e e n c o u r a g i n g then t h e r e i s a good 19 o p p o r t u n i t y t o e x p l o i t the w i n t e r growing c h a r a c t e r i s t i c s of t h i s p l a n t and e x t e n d the growing season i n t o the summer by a r t i f i c i a l l y i n d u c e d u p w e l l i n g of c o l d e r , n u t r i e n t r i c h bottom wate r . In 1979, the p r o v i n c i a l M a r i n e Resources Branch (MRB), M i n i s t r y of Environment, funded a p r e l i m i n a r y e v a l u a t i o n of the a m e n a b i l i t y of l o c a l P o r p hyra t o c u l t u r e i n B r i t i s h Columbia. The study p r o v i d e d no i n d i c a t i o n of the p o t e n t i a l q u a l i t y or q u a n t i t y of c u l t u r e d P o r p h y r a . However, t e c h n i q u e s have been adapted f o r t h e c u l t u r e of P o r phyra spp. i n Washington S t a t e and the e x p e c t a t i o n i s t h a t t h e s e methods can be s u c c e s s f u l l y i n t r o d u c e d i n B r i t i s h Columbia (Conway, et a l ., 1975). Of the s i x marine p l a n t s p e c i e s t a r g e t e d f o r t h i s study the g i a n t k e l p s , p a r t i c u l a r l y N e r e o c y s t i s , are the l e a s t l i k e l y t o r e c e i v e s e r i o u s a t t e n t i o n as c a n d i d a t e s f o r l a r g e - s c a l e c u l t u r i n g or enhancement i n B r i t i s h Columbia. Any i n d u s t r y d e v e l o p i n g around N e r e o c y s t i s would be l a r g e i n s c a l e and i n i t i a l l y d i r e c t e d a t w i l d s t o c k s . However, D r u e h l (1978) and N o r t h (1961; 1971) have d i s c u s s e d the s u c c e s s of t h e i r e f f o r t s i n enhancing and c u l t u r i n g g i a n t k e l p i n B r i t i s h Columbia and i n C a l i f o r n i a , r e s p e c t i v e l y . There i s d i s c u s s i o n about the p o s s i b l i t y of c u l t u r i n g M a c r o c y s t i s w i t h the o b j e c t i v e of s u p p l y i n g more h i g h q u a l i t y f r o n d s t o the h e r r i n g r o e - o n - k e l p i n d u s t r y than can be drawn from w i l d s t o c k s . The growing and h a r v e s t i n g p o t e n t i a l s of the s i x marine p l a n t s p e c i e s a r e summarized i n T a b l e 1. 20 SOURCE ANNUAL SPECIES INDIGENOUS OF OR HARVEST SPECIES BIOMASS PERENNIAL METHOD NEREOCYSTIS l u e t k e a n a yes w i l d s t o c k a n n u a l m e c h a n i c a l MACROCYSTIS i n t e g r i f o l i a yes wi I d s t o c k p e r e n n i a l m e c h a n i c a l LAMINARIA g r o e n l a n d i c a yes wi I d s t o c k or c u l t u r e p e r e n n i a l m e c h a n i c a l or manual CYMATHERE t r i p l i c a t a yes w i l d s t o c k or c u l t u r e a n n u a l manual GELIDIUM yes c u l t u r e p e r e n n i a l m e c h a n i c a l or manual PORPHYRA yes w i l d s t o c k or c u l t u r e a n n u a l m e c h a n i c a l or manual Ta b l e 1 - Summary of Growing and H a r v e s t i n g P o t e n t i a l 21 3. POTENTIAL PRODUCTS PRODUCED IN BRITISH COLUMBIA BY FURTHER  PROCESSING OF WILD HARVEST/MARICULTURE PLANTS Marine p l a n t s remain important f o r t h e i r t r a d i t i o n a l u t i l i z a t i o n as food and t o a l e s s e r e x t e n t as an i m a l f e e d and f e r t i l i z e r supplement. However, i n most p a r t s of the w o r l d marine p l a n t s a r e now v a l u e d as a raw m a t e r i a l f o r s p e c i f i c c h e m i c a l e x t r a c t s . R e g a r d l e s s of end-product, each s p e c i e s i s s u b j e c t e d t o some degree of p r o c e s s i n g . T h i s p r o c e s s i n g may be as l i m i t e d as sun d r y i n g L a m i n a r i a or Cymathere t o produce kombu or as s o p h i s t i c a t e d as the c h e m i c a l m a n i p u l a t i o n of M a c r o c y s t i s and N e r e o c y s t i s t o produce a l g i n i c a c i d . P r o c e s s e d end-products a r e dependent upon the c h e m i c a l c h a r a c t e r i s t i c s of the source p l a n t ; as a r e s u l t , each marine p l a n t s p e c i e s y i e l d s a pr o d u c t or s e t of p r o d u c t s t h a t i s unique t o t h a t s o u r c e p l a n t . T h e r e f o r e , s u b s t i t u t i o n between p l a n t s p e c i e s at t h e p r o c e s s i n g stage i s an e x c e p t i o n . 3.1 Che m i c a l E x t r a c t s H i s t o r i c a l l y , brown seaweed was burned and the r e s i d u e used t o produce soda and p o t a s h . L a t e r , t h e s e p l a n t s were v a l u e d f o r component r o l e s i n the p r o d u c t i o n of soap, g l a s s and i o d i n e . Cheaper a l t e r n a t i v e s were developed and today brown seaweeds a r e p r i n c i p a l l y v a l u e d f o r p h y c o c o l l o i d d e r i v a t i v e s . 22 P h y c o c o l l o i d i s a term used t o d e s c r i b e a c o l l o i d d e r i v e d from seaweed. In t u r n , a c o l l o i d i s s i m p l y a n o n - c r y s t a l l i n e s u b s t a n c e w i t h v e r y l a r g e m o l e c u l e s which, when d i s s o l v e d i n s o l u t i o n , i s v i s c o u s and g u m - l i k e . A l g i n i s the name g i v e n t o p h y c o c o l l o i d s d e r i v e d from brown seaweed. I t i s the g e n e r i c name f o r the s a l t s of a l g i n i c a c i d , the most common b e i n g sodium a l g i n a t e . The t e c h n i c a l importance of a l g i n i c a c i d l i e s m a i n l y i n the p r o p e r t i e s of i t s s a l t s . These s a l t s d i s s o l v e r e a d i l y i n water t o form an e x t r e m e l y v i s c o u s s o l u t i o n which can be f u r t h e r m o d i f i e d by the a d d i t i o n of s p e c i f i c c h e m i c a l s . A l g i n ' s a b i l i t i e s i n c l u d e : t h i c k e n i n g , s t a b i l i z i n g , s u s p e n d i n g , f i l m -f o r m i n g , g e l l i n g and e m u l s i f y i n g ( N a y l o r , 1976). The c o m m e r c i a l importance of a l g i n l i e s i n i t s r o l e as a c r i t i c a l component f o r the p r o d u c t i o n of a wide range of manufactured e n d - p r o d u c t s . The c a r r a g e e n o p h y t e s (carrageenan p r o d u c i n g marine p l a n t s ) and a g a r o p h y t e s a r e r e d seaweeds b e l o n g i n g t o the c l a s s Rhodophyceae. W h i l e c a r r a g e e n o p h y t e s have been e x c l u d e d from t h i s s t u d y ( f o r economic reasons) the v a r i o u s p h y c o c o l l o i d s of red macrophytes a r e c l o s e l y r e l a t e d c h e m i c a l l y and c o n s i s t o f a t l e a s t two major p o l y s a c c h a r i d e compounds: one compound i s r e s p o n s i b l e f o r g e l l i n g and the o t h e r f o r v i s c o s i t y . The p o l y s a c c h a r i d e component of the p h y c o c o l l o i d s i s s i m p l y a c a r b o h y d r a t e t h a t can be decomposed by h y d r o l y s i s i n t o two or more monosaccharide m o l e c u l e s . Agar, the p h y c o c o l l o i d d e r i v e d from the aga r o p h y t e s i s i n s o l u a b l e i n c o l d water but s o l u a b l e i n b o i l i n g water t o make a l i q u i d w h i ch, when c o o l e d , forms a 23 c l e a r , f i r m , r e s i l i e n t g e l . T h i s g e l ( l i k e a l g i n ) i s d e s i r e d f o r i t s p a r t i c u l a r s u s p e n d i n g , s t a b i l i z i n g and t h i c k e n i n g p r o p e r t i e s . S i n c e each p h y c o c o l l o i d i s d e s i r e d f o r i t s s p e c i f i c c h e m i c a l c h a r a c t e r i s t i c s competing or o v e r l a p p i n g use i s not a s e r i o u s m a r k e t i n g c o n s i d e r a t i o n . Through a g g r e s s i v e p r o d u c t r e s e a r c h and development, i n t e r n a t i o n a l markets f o r each p h y c o c o l l o i d have been e s t a b l i s h e d and expanded. 3.2 P r e s e n t P r o d u c t s Produced In B r i t i s h Columbia At t h i s time the o n l y r e g u l a r l y h a r v e s t e d marine p l a n t on the West Coast i s M a c r o c y s t i s i n t e g r i f o l i a . S m a l l q u a n t i t i e s of the p l a n t a r e h a r v e s t e d and t e m p o r a r i l y r e l o c a t e d i n a r e a s where h e r r i n g are e x p e c t e d t o spawn. The p r o d u c t i o n of h e r r i n g r o e - o n - k e l p (known as komochi kombu) i s i n t e n d e d f o r the Japanese market. The amount of M a c r o c y s t i s h a r v e s t e d f o r t h i s purpose has i n c r e a s e d from 4.0 wet weight tonnes i n 1978, t o 97.5 wet weight tonnes i n 1982. In l a t e summer, the e s t i m a t e d s t a n d i n g s t o c k of M a c r o c y s t i s i n t e g r i f o l i a t o t a l s about 50,000 wet weight tonnes (MRB s t a t i s t i c s ) . 24 3.3 P o t e n t i a l P r o d u c t s At the p r e s e n t time i n B r i t i s h Columbia t h e r e i s no investment i n commercial marine p l a n t p r o c e s s i n g f a c i l i t i e s . I f p r o c e s s i n g c a p a b i l i t e s i n B r i t i s h Columbia d e v e l o p and c u l t u r e and enhancement methods a r e employed the f o l l o w i n g range of p o t e n t i a l p r o d u c t s would be approached s u b j e c t , of c o u r s e , t o the economic, e n v i r o n m e n t a l and s o c i a l impacts of p r o d u c t i o n i n B r i t i s h C o lumbia. N e r e o c y s t i s i s the most abundant of a l l marine p l a n t s found on t h e West C o a s t . By l a t e summer, n e a r l y 500,000 wet weight tonnes a r e found a l o n g the c o a s t l i n e and the m a j o r i t y of t h i s s t a n d i n g s t o c k i s l o s t a n n u a l l y d u r i n g w i n t e r storms. Without investment i n p r o c e s s i n g f a c i l i t i e s , N e r e o c y s t i s has no v a l u e w i t h i n B r i t i s h Columbia and, a t b e s t , c o u l d be e x p o r t e d i n e i t h e r a wet or s u n - d r i e d s t a t e . Investment i n p r o c e s s i n g f a c i l i t i e s c o u l d i n c l u d e m e c h a n i c a l d r y e r s and an e x t r a c t i o n p l a n t . T h i s would p e r m i t a sequence of a d d i t i o n a l p r o d u c t i o n i n B r i t i s h Columbia from k e l p meal and f e r t i l i z e r supplement t o a l g i n and i t s c h e m i c a l b y - p r o d u c t s . H a r v e s t i n g M a c r o c y s t i s and d e v e l o p i n g i t s range of p o t e n t i a l p r o d u c t s would p a r a l l e l the development of p r o c e s s i n g f a c i l i t i e s as o u t l i n e d f o r N e r e o c y s t i s . In a d d i t i o n t o komochi kombu, M a c r o c y s t i s , l i k e N e r e o c y s t i s , i s a raw m a t e r i a l source f o r k e l p meal, f e r t i l i z e r supplement and a l g i n and i t s c h e m i c a l b y - p r o d u c t s . E x t e n s i v e ocean farms of c u l t u r e d M a c r o c y s t i s and N e r e o c y s t i s have been proposed as a p o t e n t i a l source of p l a n t 25 biomass t o produce methane gas t h r o u g h a n e r o b i c d i g e s t i o n ( B r y c e , 1977). L a m i n a r i a and Cymathere can both be used as source p l a n t s f o r the p r o d u c t i o n of kombu. In B r i t i s h C o lumbia, kombu has been produced from both w i l d and c u l t u r e d s t o c k s . C u l t u r e t e c h n i q u e s have been d e v e l o p e d f o r both t a x a w i t h documented improvements i n the n u t r i e n t v a l u e ( D r u e h l , 1980 b ) . L a m i n a r i a and Cymathere have been suggested f o r use i n the B r i t i s h Columbia r o e - o n - k e l p i n d u s t r y and f o r m e d i c a l a p p l i c a t i o n s . L a m i n a r i a " t e n t s " a r e employed as c e r v i c a l d i l a t o r s i n g y n a e c o l o g i c a l p r a c t i s e and, i n C h i n a , t h y r o i d d i s o r d e r s have been s u c c e s s f u l l y t r e a t e d w i t h i o d i n e s u p p l i e d by the d i g e s t i o n of k e l p . In o t h e r a r e a s L a m i n a r i a and Cymathere have been u t i l i z e d f o r the p r o d u c t i o n of a l g i n . G e n e r a l l y , P o rphyra i s d r i e d and p r e s s e d i n t o t h i n u n i f o r m l y s i z e d s h e e t s t o produce n o r i . N o r i s h e e t s a r e o f t e n used as wrappings f o r s u s h i . In o t h e r forms n o r i can be t o a s t e d or baked and used as an i n g r e d i e n t or condiment. N o r i i s the s i n g l e most i m p o r t a n t seaweed p r o d u c t consumed i n Japan. In non-food a p p l i c a t i o n s P o r p h y r a has been suggested as a source of energy p r o d u c t i o n , p h y c o c o l l o i d s , dyes and d r u g s . Porphyra i s e x t e n s i v e l y c u l t i v a t e d throughout Japan and c o n c e r t e d e f f o r t s have been made by the Washington Department of N a t u r a l Resources t o adapt t h e s e t e c h n i q u e s t o the Puget Sound a r e a (Kramer, C h i n and Mayo, I n c . , 1982). I f t h i s attempt i s s u c c e s s f u l t h e r e i s p o t e n t i a l f o r a range of non-food p r o d u c t s and q u a l i t y n o r i p r o d u c t i o n i n B r i t i s h C olumbia. 26 S e v e r a l s p e c i e s of G e l i d i u m a re n a t i v e t o t h e West C o a s t . In the w i l d , G e l i d i u m does not occur i n c o n c e n t r a t i o n s t h a t would warrent c o m m e r c i a l h a r v e s t i n g however, a c u l t u r e s u p p o r t e d G e l i d i u m h a r v e s t has been suggested (Whyte, p. c.) f o r the p r o d u c t i o n of h i g h - q u a l i t y b a c t e r i o l o g i c a l grade a g a r . T h i s agar i s used as a c u l t u r e medium f o r growing c e l l s and m i c r o -o r g a n i s m s . R e c e n t l y a g a r o s e , f r a c t i o n a t e d from G e l i d i u m a g a r , has found a p p l i c a t i o n i n immunology and g e l chromatography. T a b l e 2 p r o v i d e s a summary of the range of l i k e l y p r o d u c t s a s s o c i a t e d w i t h the s i x marine p l a n t s p e c i e s . 27 SPECIES CHEMICAL EXTRACTS EDIBLES OTHER NEREOCYSTIS l u e t k e a n a a l g i n c h e m i c a l by - p r o d u c t s k e l p meal f e r t i l i z e r MACROCYSTIS i n t e g r i f o l i a a l g i n c h e m i c a l by - p r o d u c t s k e l p meal r o e - o n - k e l p f e r t i l i z e r LAMINARIA g r o e n l a n d i c a a l g i n kombu r o e - o n - k e l p m e d i c a l CYMATHERE t r i p l i c a t a a l g i n kombu r o e - o n - k e l p m e d i c a l GELIDIUM agar agarose PORPHYRA n o r i dyes m e d i c a l T a b l e 2 - Range of P o t e n t i a l P r o d u c t s 28 4. CONCLUSIONS T h i s c h a p t e r d e s c r i b e s the marine p l a n t r e s o u r c e and p o t e n t i a l d e r i v a t i v e p r o d u c t s . S e v e r a l p o i n t s a re worth r e i t e r a t i n g . F i r s t , the marine p l a n t r e s o u r c e i s i n d i g e n o u s t o the west c o a s t , i t i s a renewable r e s o u r c e and many s p e c i e s a r e abundant. Second, marine p l a n t s p e c i e s a r e a component of a complex ecosystem; grow and d e v e l o p a c c o r d i n g t o an i d e n t i f i a b l e l i f e c y c l e ; and c h e m i c a l c o m p o s i t i o n s change throughout the l i f e c y c l e . C o n s e q u e n t l y , any h a r v e s t i n g s t r a t e g y s h o u l d c o n s i d e r optimum c h e m i c a l c h a r a c t e r i s t i c s f o r end-product p r o d u c t i o n w h i l e r e c o g n i z i n g and p r o v i d i n g f o r the dynamics of the h a r v e s t a r e a . T h i r d , c u l t u r e t e c h n i q u e s have been d e v e l o p e d f o r the seven c o m m e r c i a l s p e c i e s . In B r i t i s h Columbia t h e i r a p p l i c a t i o n would l i k e l y be r e s t r i c t e d t o c a s e s where p l a n t s p e c i e s a r e e i t h e r t o p l i m i t e d or d i s p e r s e d i n the w i l d or where the end-pro d u c t r e q u i r e s an appearance or c o n s i s t e n c y t h a t w i l d s t o c k s f a i l t o meet. At t h i s time m a r i c u l t u r e t e c h n i q u e s a r e t e s t e d f o r L a m i n a r i a g r o e n l a n d i c a , Cymathere t r i p l i c a t a , G e l i d i u m and Porphyra i n the West Coast environment. F o u r t h , t h e r e i s l i t t l e scope f o r s u b s t i t u t i o n between marine p l a n t s p e c i e s i n the p r o d u c t i o n of e n d - p r o d u c t s . These c o n s i d e r a t i o n s a r e p r e r e q u i s i t e t o the d i s c u s s i o n of the economics of p r o d u c t i o n and m a r k e t i n g which f o l l o w s . 29 I I I . MARKET SUPPLY AND DEMAND AND THE ECONOMICS OF PRODUCT PRODUCTION IN BRITISH COLUMBIA 1. INTRODUCTION The purpose of t h i s c h a p t e r i s t o a s s e s s the economic f e a s i b i l i t y of p r o d u c i n g marine p l a n t p r o d u c t s i n B r i t i s h C o lumbia. T h i s a n a l y s i s w i l l i n c l u d e a review o f : market s u p p l y and demand; and the c o s t of p r o d u c t p r o d u c t i o n . F i r s t , markets f o r B r i t i s h Columbia p r o d u c t s w i l l be o u t l i n e d i n terms of s u p p l y and demand and d i f f e r e n t market s c e n a r i o s f o r B r i t i s h Columbia p r o d u c t s w i l l be s uggested. Supply of the marine p l a n t r e s o u r c e can be m a n i p u l a t e d by c o n t r o l l i n g : a c c e s s t o the r e s o u r c e base; enhancement of n a t u r a l p r o d u c t i v i t y ; a l l o w a b l e h a r v e s t ; m a r i c u l t u r e p r o d u c t i o n ; and p r o c e s s i n g . Demand can be m a n i p u l a t e d by b oth the d e s i g n and magnitude of m a r k e t i n g s t r a t e g i e s . Market s c e n a r i o s have been i d e n t i f i e d and a r e shown t o v a r y between p r o d u c t s . The c o s t of p r o d u c t i o n i n B r i t i s h Columbia i s a l s o a n a l y s e d i n t h i s c h a p t e r . Where i n f o r m a t i o n p e r m i t s t h i s r e view w i l l c o n s i d e r the c o s t s i n c u r r e d by f i r m s and i n d u s t r y a t the v a r i o u s p r o d u c t i o n s t a g e s . T h i s a n a l y s i s w i l l i n d i c a t e what i n f o r m a t i o n i s a v a i l a b l e and what f u n c t i o n a l i n f o r m a t i o n remains o u t s t a n d i n g f o r the development of p l a n n i n g and management s t r a t e g i e s . The f o l l o w i n g a n a l y s i s w i l l be l o o s e l y o r g a n i z e d around 30 end-product s u p p l y and demand r a t h e r than the unpro c e s s e d marine p l a n t . T h i s d e c i s i o n f o l l o w s from the f a c t t h a t raw marine p l a n t s a r e o n l y v a l u e d f o r t h e i r subsequent commercial t r a d e as p r o c e s s e d marine p l a n t p r o d u c t s . N e r e o c y s t i s and M a c r o c y s t i s w i l l be a n a l y s e d i n terms of the s u p p l y and demand f o r k e l p meal, f e r t i l i z e r and c h e m i c a l e x t r a c t s . M a c r o c y s t i s has a d d i t i o n a l v a l u e f o r r o e - o n - k e l p . Cymathere and L a m i n a r i a w i l l be d i s c u s s e d i n terms of the economics of p r o d u c i n g kombu. The economics of p r o d u c i n g n o r i and agar w i l l be a n a l y s e d a c c o r d i n g t o the p r o d u c t i o n s t a g e s of Po r p h y r a and Ge1idiurn r e s p e c t i v e l y . 2. NEREOCYSTIS/MACROCYSTIS- WILD STOCK KELPS W i t h a combined s t a n d i n g s t o c k , by l a t e summer, of a p p r o x i m a t e l y 540,000 wet tonnes N e r e o c y s t i s and M a c r o c y s t i s a r e the most abundant marine p l a n t s t o oc c u r on the Canadian west c o a s t . P u b l i c and p r i v a t e promoters f e e l t h a t development of thes e p l a n t s w i l l p r o v i d e the g r e a t e s t economic r e t u r n f o r the B r i t i s h Columbia k e l p i n d u s t r y (Coon, 1983). T h i s f o r e c a s t supposes t h a t B r i t i s h Columbia p r o d u c t s w i l l be p r i c e -c o m p e t i t i v e i n i n t e r n a t i o n a l markets. 31 2.1 Supply And Demand 2.1.1 Roe-on-kelp S i n c e 1978, a p r o f i t a b l e r o e - o n - k e l p i n d u s t r y has been e s t a b l i s h i n g on the West C o a s t . H e r r i n g r o e - o n - k e l p c o n s i s t s of 3 t o 6 l a y e r s of h e r r i n g eggs a t t a c h e d t o a k e l p f r o n d . T h i s p r o d u c t has been s u c c e s s f u l l y marketed i n Japan; Pearse (1982; c i t e d i n Bourne and B r e t t , 1983) and Coon (1983) s p e c u l a t e t h a t p r o d u c t i o n c o u l d double t o meet market demand w i t h o u t d e p r e s s i n g p r i c e s . The number of a n n u a l r o e - o n - k e l p p e r m i t s has grown from 1 i n 1978 t o 28 i n 1982 w i t h 72% of these p e r m i t s h e l d by N a t i v e I n d i a n s . D u r i n g t h i s p e r i o d the l a n d e d weight of k e l p r o s e from 4.0 t o 97.5 wet tonnes w i t h a r e c o r d h i g h of 120.8 wet tonnes i n 1981. Each p e r m i t p r o v i d e s f o r 8 tonnes of p r o d u c t . Many n a t i v e f i s h e r m e n h a r v e s t s i g n i f i c a n t q u a n t i t i e s of r o e - o n - k e l p w i t h o u t an a u t h o r i z e d p r o v i n c i a l h a r v e s t i n g l i c e n c e . T h e r e f o r e t h e s e s u p p l y f i g u r e s suggest a minimum be s t e s t i m a t e . 2.1.2 F e r t i l i z e r From time t o time l i c e n c e s have been i s s u e d by the M i n i s t r y of the Environment, P r o v i n c e of B r i t i s h C o l u m b i a , t o p e r m i t the h a r v e s t of w i l d k e l p s t o c k s f o r the subsequent p r o d u c t i o n of 32 f e r t i l i z e r s . P r o v i n c i a l F i s h e r i e s Branch s t a t i s t i c s (1981) i n d i c a t e t h a t k e l p i n a f r e s h or chopped form i s v a l u e d a t $3l2/wet tonne as a f e r t i l i z e r p r o d u c t . Over the l a s t 5 y e a r s the t o t a l a n n u a l w h o l e s a l e v a l u e of t h i s p r o d u c t i o n has remained w e l l below $10,000 (Coon, p . c ) . In 1977, Maxi-Crop was the l a r g e s t w o r l d producer of seaweed based p l a n t growth a c c e l e r a t o r s w i t h a p r o d u c t i o n of 50 m i l l i o n l i t r e s and a s a l e s volume of a p p r o x i m a t e l y $2.4 m i l l i o n (Woods, Gordon and Co., 1978). The r e m a i n i n g major p r o d u c e r s a c c o u n t e d f o r some $900,000 i n combined s a l e s . In 1976, N a y l o r r e p o r t e d t h a t markets f o r seaweed d e r i v e d f e r t i l i z e r s were not l i k e l y t o d e v e l o p to any s i g n i f i c a n t e x t e n t . He n o t e d t h a t the b e n e f i t s of u s i n g seaweed d e r i v e d f e r t i l i z e r s i n a g r i c u l t u r e c o u l d be o b t a i n e d by o t h e r means and t h a t seaweed u t i l i z a t i o n p r o v i d e d no c o s t advantages. I t i s e v i d e n t from the p r e s e n t a c c e p t a n c e of seaweed d e r i v e d f e r t i l i z e r s t h a t these o b s e r v a t i o n s have h e l d t r u e . 2.1.3 Kelp-meal In 1946, Canada K e l p Co. L t d . became the f i r s t i n a s e r i e s of companies t o propose k e l p h a r v e s t i n g and k e l p meal p r o d u c t i o n on the West C o a s t . In 1981, Enmar Resources C o r p o r a t i o n (Enmar) j o i n e d t h i s s e r i e s and became the p r i n c i p a l r e p r e s e n t a t i v e f o r i n d u s t r i a l development w i t h a c o n d i t i o n a l P r o v i n c i a l guarantee of h a r v e s t i n g and p r o c e s s i n g l i c e n c e s . 33 However, due t o d i v e r g e n t F e d e r a l and P r o v i n c i a l management o b j e c t i v e s and o v e r l a p p i n g c l a i m s t o s o l e o w n e r s h i p and r e g u l a t o r y c o n t r o l of marine p l a n t r e s o u r c e s , Enmar has y e t t o r i s k c a p i t a l investment and k e l p meal has not been produced i n B r i t i s h Columbia. A 1980 r e s e a r c h r e p o r t (Woods Gordon) r e v i e w e d the N o r t h American market f o r k e l p meal as a component of a f e a s i b i l i t y s t udy f o r a k e l p meal p r o c e s s i n g p l a n t on the Queen C h a r l o t t e I s l a n d s . In summary, the f i n d i n g s were: 1. S t a u f f e r Chemical Co. of Oxnard, C a l i f o r n i a was the o n l y N o r t h American s o u r c e of P a c i f i c k e l p meal f o r human consumption. S t a u f f e r h e l d l e a s e r i g h t s f o r a number of M a c r o c y s t i s beds i n C a l i f o r n i a . 2. A p p r o x i m a t e l y 320 t o n n e s / y r . of P a c i f i c k e l p were b e i n g s o l d by S t a u f f e r i n N o r t h A m e r i c a . 3. In 1970, the market volume was 1100-1400 tonnes per y e a r . The s i g n i f i c a n t d e c l i n e i n s a l e s volume by 1980 was a t t r i b u t e d t o reduced s u p p l y o f raw k e l p and S t a u f f e r ' s attempt t o m a i n t a i n revenue by i n c r e a s i n g p r i c e . 4. I f B r i t i s h Columbia k e l p became a v a i l a b l e , the market would grow 3-5% per year as p o p u l a t i o n s grew and t a s t e s changed toward h e a l t h - t y p e food p r o d u c t s . 5. In N o r t h America the market f o r P a c i f i c k e l p was not s i g n i f i c a n t l y a f f e c t e d by e i t h e r A t l a n t i c or imported k e l p . The t h r e e t y p e s of k e l p a r e not i n t e r c h a n g e a b l e due t o t h e i r d i f f e r e n t t a s t e s and c o m p o s i t i o n s . 6. The r e q u i r e d s e l l i n g p r i c e f o r B r i t i s h Columbia k e l p meal was e s t i m a t e d a t $ 0 . 8 5 / l b . F.O.B. Masset f o r a 18.2 tonne l o a d . S t a u f f e r ' s e q u i v a l e n t p r i c e was e s t i m a t e d a t $0.89/lb. 7. At a p r i c e of $ l 8 7 0 / t o n n e , the a n n u a l market f o r B r i t i s h Columbia k e l p meal was p r e d i c t e d t o r e a c h 480-520 tonnes by the t e n t h y e ar of o p e r a t i o n . T h i s volume r e p r e s e n t s a 100% share of the market s i n c e S t a u f f e r was e x p e c t e d t o r e - r o u t e a l l k e l p s u p p l i e s i n t o the more p r o f i t a b l e a l g i n a t e p r o d u c t i o n i f f a c e d 34 w i t h c o m p e t i t i o n i n the k e l p meal market. Faced w i t h s t i f f c o m p e t i t i o n from K e l c o Co. i n a l g i n a t e markets and d i m i n i s h e d markets f o r k e l p meal S t a u f f e r has s u b s e q u e n t l y t e r m i n a t e d the seaweed p r o c e s s i n g arm of i t s i n t e g r a t e d o p e r a t i o n l e a v i n g open the N o r t h American market f o r k e l p meal. S t a u f f e r ' s k e l p meal p l a n t and C a l i f o r n i a k e l p bed l e a s e s were s o l d t o a p a r t n e r s h i p of B r a z i l i a n and American i n t e r e s t s . The p l a n t was then d i s m a n t l e d and B r a z i l i a n k e l p i m p o r t e d t o p r o v i d e s t o c k f o r t h i s group's p r o d u c t i o n . S p e c u l a t i o n s u g g e s t s t h a t t h i s i s a case of one p r o d u c e r b u y i n g out the c o m p e t i t i o n ( S r i v a s t a v a , p . c ) . Consumption of k e l p meals i n Europe i s e s t i m a t e d a t between 5,000-10,000 tonnes a n n u a l l y (Woods, Gordon and Co., 1978). These meals a r e produced i n Norway, I c e l a n d and Denmark. I f 20% of the August-September k e l p s t a n d i n g c r o p were t o be a l l o c a t e d f o r annual h a r v e s t t h e n , i t has been e s t i m a t e d , B r i t i s h Columbia c o u l d s u p p l y 110,000 wet tonnes of k e l p t o w o r l d markets (Coon, 1983). Based on an e s t i m a t e d r e a l a n n u a l market growth of 2% (Woods, Gordon and Co., 1978) t h i s t o t a l p r o d u c t i o n r e p r e s e n t s o n l y 5 y e a r s of w o r l d market growth (Coon, 1983) . 35 2.1.4 C h e m i c a l E x t r a c t s The l a r g e s t producer of a l g i n a t e i s K e l c o Co. T h i s company has p l a n t s i n San D iego, C a l i f o r n i a ; Woods Harbour, Nova S c o t i a and i n S c o t l a n d w i t h the r e c e n t a c q u i s i t i o n of A l g i n a t e I n d u s t r i e s L t d . In 1977 K e l c o ' s p r e s e n t h o l d i n g s a c c o u n t e d f o r a p p r o x i m a t e l y 15,000 tonnes of a l g i n a t e p r o d u c t i o n (Woods, Gordon and Co., 1978). France and Norway are the s i t e s of o t h e r s i g n i f i c a n t p r o c e s s o r s and s m a l l e r p l a n t s e x i s t i n C h i l e , I n d i a and Japan. Woods, Gordon and Co. (1978) a l s o r e p o r t e d a major p l a n t b e i n g c o n s t r u c t e d i n B r a z i l . K e l c o ' s San Diego p l a n t i s s u p p l i e d w i t h M a c r o c y s t i s from C a l i f o r n i a and Mexico and w i t h i m p o r t e d d r i e d M a c r o c y s t i s and L a m i n a r i a . The Woods Harbour p l a n t r e l i e s on l o c a l i n t e r t i d a l seaweeds and the S c o t t i s h p l a n t i s s u p p l i e d by b o t h l o c a l seaweeds and i m p o r t s from Norway, I r e l a n d , F r a n c e , I c e l a n d and C h i l e (Woods, Gordon and Co., 1978). In g e n e r a l , the s m a l l e r a l g i n a t e p r o d u c e r s r e l y on and are l i m i t e d by the a v a i l a b i l i t y of l o c a l s o u r c e seaweeds. Japan i s the p r i n c i p a l e x c e p t i o n t o t h i s o b s e r v a t i o n . Woods, Gordon and Co. (1978) c o n c l u d e t h a t the f u t u r e growth i n s u p p l y of seaweeds f o r a l g i n a t e p r o d u c t i o n w i l l be r e l a t e d t o the i m p o r t a t i o n of d r i e d brown weeds s i n c e e x i s t i n g l o c a l s t o c k s a r e u t i l i z e d t o the maximum s u s t a i n a b l e y i e l d . G i v e n a m a r k e t a b l e N e r e o c y s t i s and M a c r o c y s t i s h a r v e s t or a l g i n p r o d u c t , then B r i t i s h Columbia c o u l d be e x p e c t e d t o become a new s o u r c e of s u p p l y . Coon (1983), s u g gests t h a t t h e r e i s 36 reason f o r co n c e r n about c o m p e t i t i o n from: o t h e r major untapped n a t u r a l k e l p r e s o u r c e a r e a s i n c l u d i n g A r g e n t i n a and C h i l e ; p r o p o s a l s ( B r y c e , 1977) f o r massive ocean farms of M a c r o c y s t i s ; and China where a crude form of a l g i n a t e i s e x t r a c t e d from c u l t u r e d L a m i n a r i a and e x p o r t e d t o Japan and Europe. The 1977 market f o r a l g i n a t e s was e s t i m a t e d a t 21,900 tonnes w i t h 7500-8500 tonnes b e i n g consumed a n n u a l l y i n the U n i t e d S t a t e s and Canada. In Japan, domestic p r o d u c t i o n reached 1200 tonnes but t o t a l consumption was a p p r o x i m a t e l y 3000 tonnes (Woods, Gordon and Co., 1978). I t has been e s t i m a t e d t h a t B r i t i s h Columbia c o u l d c o n t r i b u t e 2160 tonnes of a l g i n a t e t o w o r l d markets i f 20% of the maximum s e a s o n a l s t a n d i n g c r o p was a l l o c a t e d f o r h a r v e s t (Coon, 1983). Demand f o r a l g i n a l s o e x i s t e d i n s e v e r a l E a s t e r n European c o u n t r i e s and i n P a k i s t a n , B r a z i l , A r g e n t i n a , South A f r i c a and.the P h i l i p p i n e s . 2.2 Market S c e n a r i o s And The C o s t s Of P r o d u c t i o n In B r i t i s h Columbia 2.2.1 Roe-on-kelp Data has not y e t been c o m p i l e d t o i n d i c a t e the c u r r e n t d o l l a r i n v e s t m e n t i n the r o e - o n - k e l p i n d u s t r y and the c o s t s of p r o d u c t i o n i n B r i t i s h C o lumbia. T h i s i s a d i f f i c u l t o b j e c t i v e and c o m p l i c a t e d by o p e r a t o r s s h a r i n g time and equipment between 37 a d d i t i o n a l revenue g e n e r a t i n g marine a c t i v i t i e s . However, g e n e r a l o b s e r v a t i o n s are p o s s i b l e . One can s a f e l y assume t h a t h e r r i n g r o e - o n - k e l p o p e r a t i o n s a r e p r o f i t a b l e . The c o s t of m a t e r i a l s i s low, most support systems are a l r e a d y i n p l a c e and the p r o d u c t i o n season spans about 2 months. Bourne and B r e t t (1983) r e p o r t t h a t a s i n g l e good f r o n d i s worth up t o $50 and i n C a l i f o r n i a the r e t a i l p r i c e ranges from $ l 8 - 4 4 / k g . depending upon q u a l i t y . G iven c u r r e n t demand f o r e c a s t s Coon (1983), r e p o r t s t h a t i n d u s t r y p r o d u c t i o n c o u l d double t o an a n n u a l w h o l e s a l e v a l u e of about $7.7 m i l l i o n w i t h no r e d u c t i o n i n w h o l e s a l e v a l u e . 2.2.2 K e l p - m e a l The 1980 Woods Gordon f e a s i b i l i t y study f o r a k e l p meal p r o c e s s i n g p l a n t i n the P r i n c e Rupert-Queen C h a r l o t t e I s l a n d s a r e a c o n c l u d e d t h a t the p l a n t would not be e c o n o m i c a l l y v i a b l e under the m a r k e t , o p e r a t i n g c o s t and f i n a n c i a l arrangements assumed. B r i e f l y , these assumptions i n c l u d e d : 1. c o n s t r u c t i o n of a new 25 metre k e l p h a r v e s t e r w i t h a p a y l o a d c a p a c i t y of 125 tonnes and a new p r o c e s s i n g p l a n t c a p a b l e of p r o d u c i n g 350-500 t o n n e s / y r . of d r i e d k e l p ; 2. t h e e n t i r e o p e r a t i o n t o be the r e s p o n s i b i l i t y of an employed Manager and not be Owner o p e r a t e d ; and 3. t h e e n t i r e c a p i t a l c o s t of $2.3 m i l l i o n t o be f i n a n c e d by a 10-year l o a n a t 13% average ann u a l i n t e r e s t over th e 1 0-year p e r i o d . 38 However, the study s p e c u l a t e d t h a t i f 100% of the N o r t h American market c o u l d be o b t a i n e d i n the f i r s t year and i f the a c c u m u l a t e d u n p a i d i n t e r e s t and l o a n repayments c o u l d be d e f e r r e d then the o p e r a t i o n c o u l d be c o n s i d e r e d v i a b l e . Market developments s i n c e 1980 have r e s u l t e d i n an o p p o r t u n i t y f o r a s u p p l i e r of P a c i f i c k e l p meal t o market 300 d r y tonnes a n n u a l l y i n N o r t h A m e r i c a . Assuming the o p e r a t i n g and f i n a n c i a l arrangements Enmar has adopted then i t i s t h e i r o p i n i o n t h a t w i l d s t o c k s of k e l p can be p r o f i t a b l y h a r v e s t e d and produced i n t o k e l p meal i n B r i t i s h C olumbia. Enmar assumes t h a t a m a r g i n a l v e n t u r e can be e x p e c t e d w i t h a 2000 wet tonne h a r v e s t . For a t o t a l c a p i t a l i n v e s t m e n t ( i n 1982 d o l l a r s ) of $600,000-700,000 a 2000 tonne k e l p meal o p e r a t i o n c o u l d expect t o break even i n the t h i r d or f o u r t h year of o p e r a t i o n ( S r i v a s t a v a , p . c ) . As a means t o reduce f i n a n c i n g c o s t s Enmar proposes t o m i n i m i z e l a b o u r c o s t s t h rough m e c h a n i z a t i o n and m i n i m i z e c a p i t a l investment by r e d u c i n g the need f o r e x p e n s i v e s p e c i a l i z e d p a r t s and equipment. The p r o c e s s i n g o p e r a t i o n proposed i n the 1980 study o f f e r r e d d e s i r a b l e secondary b e n e f i t s i n c l u d i n g new b u i l d i n g and boat c o n s t r u c t i o n . As t h e s e s o c i a l b e n e f i t s were reduced the v i a b i l i t y of t h a t p r o p o s a l a l s o took on g r e a t e r economic a p p e a l t o the e n t r e p r e n e u r (Woods Gordon, 1980). 39 2.2.3 C hemical E x t r a c t s Enmar a n t i c i p a t e s t h a t a 5000 tonne/year k e l p meal o p e r a t i o n c o u l d grow over 3-5 y e a r s t o a l e v e l of 20,000 tonnes a t which p o i n t a medium s i z e d e x t r a c t i o n p l a n t would become v i a b l e . D u r i n g t h i s p e r i o d a p i l o t - s c a l e e x t r a c t i o n p l a n t c o u l d be b u i l t f o r $600,000 (1982 d o l l a r s ) t o p r o c e s s 20 tonnes of k e l p . The a l g i n produced c o u l d be t e s t e d f o r product q u a l i t y and market a c c e p t a n c e . For an a d d i t i o n a l $8-9 m i l l i o n (1982 d o l l a r s ) a medium s i z e d commercial e x t r a c t i o n p l a n t c o u l d be b u i l t i n B r i t i s h Columbia t o p r o c e s s 15,000 tonnes of k e l p per y e a r . In a d d i t i o n t o the a l g i n a t e produced, the Enmar p r o c e s s i s d e s i g n e d t o r e c o v e r a range of c h e m i c a l b y - p r o d u c t s t h a t o t h e r p r o c e s s o r s d i s c h a r g e as waste. These b y - p r o d u c t s are m a r k e t a b l e and t h e i r s a l e has f i g u r e d i n t o Enmar's f o r e c a s t e d revenue. The p r i n c i p a l s of Enmar were not p r e p a r e d t o d i s c u s s the d e t a i l s of f i n a n c i n g a l g i n p r o d u c t i o n , however, they would conceed t h a t any a t t e mpt t o produce or market a l g i n a t e would have t o be i n c o n j u n c t i o n w i t h K e l c o . 2.3 Summary Adequate s t o c k s of n a t u r a l l y o c c u r r i n g N e r e o c y s t i s and M a c r o c y s t i s a r e l o c a t e d o f f the West Coast t o support commercial p r o d u c t i o n of k e l p meal, f e r t i l i z e r , c h e m i c a l e x t r a c t s and r o e -40 o n - k e l p . In terms of c u r r e n t demand however, o n l y r o e - o n - k e l p and p o s s i b l y k e l p meal have a s s u r e d markets. P r o d u c t i o n c o s t s f o r h e r r i n g r o e - o n - k e l p remain c l o u d e d by the use of equipment shared between o t h e r f i s h i n g a c t i v i t i e s but the c o n t i n u e d p u l l of h a r v e s t e r s t o t h i s s e c t o r s u g g e s t s c o n t i n u e d p r o f i t a b i l i t y . The demand f o r f e r t i l i z e r d e r i v e d from k e l p i s s p o r a d i c w i t h l i t t l e or no growth f o r e c a s t and the market i s dominated by one key company. Giv e n the s u g g e s t i o n t h a t c u r r e n t w o r l d p r o d u c t i o n of p h y c o c o l l o i d s i s e q u a l t o or g r e a t e r than c u r r e n t w o r l d demand (Gunn, V a l i e l a and Green, 1983) and t h a t markets f o r a west c o a s t p r o d u c t remain u n t e s t e d , a l g i n a t e p r o d u c t i o n i n B r i t i s h Columbia appears t o be a ma t t e r f o r re-assessment a t some f u t u r e d a t e . Given t h e r e i s a market, p r o d u c t i o n c o s t s f o r a l g i n a t e and i t s c h e m i c a l b y - p r o d u c t s have been a s s e s s e d and f o r e c a s t e d c o s t s do not appear t o i n h i b i t development of t h i s s e c t o r of the i n d u s t r y . 3.. LAMINARIA/CYMATHERE-KOMBU 3.1 Supply U n l i k e p h y c o c o l l o i d s , which a r e a c t i v e l y t r a d e d i n i n t e r n a t i o n a l markets, the s u p p l y and demand f o r e d i b l e seaweed p r o d u c t s i s m a i n l y l i m i t e d t o O r i e n t a l c o u n t r i e s and l o c a l i z e d O r i e n t a l communities. Kombu i s the Japanese name g i v e n t o the 41 e d i b l e p r o c e s s e d p r o d u c t s d e r i v e d from L a m i n a r i a and Cymathere. L a m i n a r i a j a p o n i c a i s the source of kombu i n Japan and China and i t s consumption has become a t r a d i t i o n over the l a s t 1000 y e a r s . D e v e l o p i n g from a r e l i a n c e on w i l d s t o c k s , the p r o d u c t i o n of kombu i n Japan and China i s now based on c u l t i v a t e d s t o c k s . In C h i n a d u r i n g the k e l p y e ar 1978-1979, more than 18,000 h e c t a r e s of marine farms were engaged i n the commercial c u l t i v a t i o n of L a m i n a r i a and more than 1,000,000 wet tonnes, v a l u e d a t about U.S.$300 m i l l i o n were produced (Tseng, 1981). In J apan, the cummulative e f f e c t s of c o a s t a l p o l l u t i o n and v a r i o u s n a t u r a l e n v i r o n m e n t a l f a c t o r s have caused a s i g n i f i c a n t r e d u c t i o n i n the p r o d u c t i o n of w i l d L a m i n a r i a . In 1951, the Japanese t u r n e d t o c u l t u r e and by 1974, 7500 wet tonnes, worth about U.S.$1 m i l l i o n were produced (Tseng, 1981). T h i s amounted t o 16% of the n a t u r a l p r o d u c t i o n on r e e f s (Hasegawa, 1976; c i t e d i n Tseng, 1981). In t o t a l , Japan produces 30,000-33,000 dry tonnes of kombu per year f o r which the grower r e c e i v e s from $3,500-28,000 per d r y tonne depending upon q u a l i t y (B.C. S h e l l f i s h M a r i c u l t u r e N e w s l e t t e r , March 1983)'. S e v e r a l s p e c i e s of L a m i n a r i a and Cymathere t r i p l i c a t a occur n a t u r a l l y on the Canadian west c o a s t . In 1980, B.C.J. T r a d i n g Co. h a r v e s t e d 57.5 wet tonnes of t h e s e e d i b l e k e l p s and produced 30.5 tonnes of kombu f o r a w h o l e s a l e v a l u e of $230,000. S i n c e 1979, the M.R.B. and S c i e n c e C o u n c i l of B r i t i s h Columbia have funded r e s e a r c h i n t o the development of kombu c u l t u r e t e c h n o l o g y . The argument i n f a v o u r of d e v e l o p i n g c u l t u r e t e c h n o l o g y f o r these s p e c i e s s u g g e s t s t h a t i t may be p o s s i b l e t o 42 produce a "kombu p r o d u c t w i t h d e s i r a b l e commercial c h a r a c t e r i s t i c s and a c c o r d i n g t o a c o n t r o l l e d p r o d u c t i o n s c h e d u l e . T h i s would f r e e the producer from the u n c e r t a i n t y of adequate a v a i l a b i l i t y of w i l d s t o c k s . The r e s u l t s of e i g h t e x p e r i m e n t a l kombu farms once i n o p e r a t i o n suggest t h a t the c o a s t a l waters of B r i t i s h Columbia can support c u l t u r e a c t i v i t i e s . F u r t h e r c o n s i d e r a t i o n of the economics of p r o d u c t i o n a r e r e q u i r e d t o g i v e an i n d i c a t i o n of commercial v i a b i l i t y , however. Based on h i s e x p e r i m e n t a l work D r u e h l (p.c.) has p r o v i d e d p r o d u c t i o n e s t i m a t e s r a n g i n g from a low of 0.422 d r y tonnes/ha f o r Cymathere t r i p l i c a t a t o a h i g h of 9.037 dry tonnes/ha f o r L a m i n a r i a g r o e n l a n d i c a . The r a t e s a re summarized as f o l l o w s : CULTURE PRODUCTION (dry tonnes) SPECIES PERIOD (month) per km seeded rope per h e c t a r e * L . g r o e n l a n d i c a 16 0.481-3.793 1.154-9.037 L . s a c c h a r i n a 8 0.351-0.840 0.756-2.103 C . t r i p l i c a t a 7 0.176-0.432 0.422-1.016 *= assume c u l t u r e l i n e s s p r e a d 8.5m apart;- 2.4 km seeded l i n e per h e c t a r e . 3.2 Demand Japanese markets p l a y a dominant r o l e i n the t r a d e and u l t i m a t e consumption of e d i b l e seaweeds. These markets, however, a r e p r o t e c t e d from f o r e i g n p l a n t p r o d u c t i o n by a system 43 of import q u o t a s . Quota l e v e l s respond t o domestic p r o d u c t i o n and consumption i n an attempt t o m a i n t a i n the r e q u i r e d s u p p l y . At t h i s t i m e , Japan e n f o r c e s an import quota of 1660 d r y tonnes per year f o r L a m i n a r i a . Cymathere t r i p l i c a t a i s not c u l t i v a t e d i n Japan; t h e r e f o r e i m p o r t s a r e not s u b j e c t t o r e s t r i c t i o n s . Japanese government s t a t i s t i c s i n d i c a t e t h a t f o r 1976, i m p o r t s r e p r e s e n t e d 30% of the s u p p l y of e d i b l e seaweeds. C o u n t r i e s b o r d e r i n g on the Sea of Japan and on the Y e l l o w Sea a r e a l s o r e c o g n i z e d as i m p o r t a n t , a l b e i t secondary, consumers. T h i s l o c a l i z e d a c c e p t a n c e of marine macrophytes as a f o o d s t u f f appears r e l a t e d t o the t r a d i t i o n and t a s t e s of O r i e n t a l communities. Japan has e x p r e s s e d i n t e r e s t i n B r i t i s h Columbia kombu. In September of 1979, a d e l e g a t i o n of Japanese kombu p r o c e s s o r s i n v e s t i g a t e d the kombu r e s o u r c e s of B r i t i s h Columbia and d e s c r i b e d the q u a l i t y of l o c a l p l a n t s as good ( D r u e h l , 1980 b . ) . The s u s t a i n e d i n t e r e s t of Japanese kombu buyers w i l l depend upon the c o n t i n u e d q u a l i t y and c o m p e t i t i v e p r i c i n g of a f i n a l p r o d u c t . However, l o n g - t e r m p a y o f f s a r e e x p e c t e d t o be g r e a t e s t f o r development and pro m o t i o n of a p r o d u c t aimed a t Western t a s t e s . 44 3.3 Market S c e n a r i o s For B r i t i s h Columbia P r o d u c t s S i n c e w i l d s t o c k s of L a m i n a r i a and Cymathere a r e l i m i t e d and l o c a l i z e d i n B r i t i s h Columbia's c o a s t a l w a t e r s , development of a kombu i n d u s t r y c o u l d f o l l o w two p a t h s . F i r s t , r e l y i n g upon w i l d s t o c k s , a c o t t a g e i n d u s t r y c o u l d emerge w i t h a number of p a r t i c i p a n t s ; each p r o d u c i n g a q u a n t i t y of kombu dete r m i n e d by development o b j e c t i v e s f o r the r e g i o n . Second, by t u r n i n g t o proven kombu c u l t u r e t e c h n i q u e s , the i n d u s t r y c o u l d f r e e i t s e l f of l i m i t e d l o c a l i z e d h a r v e s t s and e s t a b l i s h kombu farms w i t h p r o d u c t i o n l e v e l s t h a t are t a r g e t e d t o s u p p l y l o c a l or w o r l d demand. Kombu c u l t u r e r e s e a r c h was i n i t i a t e d i n B r i t i s h Columbia w i t h a hope t o compete i n s u p p l y i n g an annual 800 tonne s h o r t f a l l i n the Japanese market. Low-cost Chinese p r o d u c t i o n c a p t u r e d t h i s market and kombu fa r m e r s have now t a r g e t e d the l o c a l "snack f o o d " market. The domestic market f o r kombu i s v e r y s m a l l but the consensus i s t h a t e x p a n s i o n c o u l d be d r a m a t i c i f a p r o d u c t which matched domestic t a s t e s c o u l d be produced ( M a r i c u l t u r e S p e c i e s Review, 1982). In the f o l l o w i n g s e c t i o n an analogous m a r k e t i n g problem i s shown t o e x i s t f o r n o r i . S i n c e O r i e n t a l markets f o r n o r i and kombu ar e c u r r e n t l y w e l l - s u p p l i e d , p r o d u c t r e s e a r c h and development of N o r t h American markets a r e c r i t i c a l t o development of the e d i b l e seaweed i n d u s t r y . In N o r t h A m e r i c a , the O r i e n t a l community m a i n t a i n s a t r a d i t i o n a l demand f o r t h e s e e d i b l e p r o d u c t s but f a r g r e a t e r t o t a l demand i s r e q u i r e d b e f o r e p r o d u c t i o n f o r a 45 d o m e s t i c market becomes v i a b l e . To i l l u s t r a t e t h i s p o i n t , the kombu produced by B.C.J. T r a d i n g Co. i n 1980, was s o l d t o a l o c a l Japanese-Canadian buyer who c o n t i n u e d , i n 1984, t o s e l l t o r e t a i l o u t l e t s i n Vancouver, To r o n t o and San F r a n c i s c o ( K i r k w o o d , p . c . ) . The l o n g - t e r m o b j e c t i v e of B.C.J. T r a d i n g Co. i s t o t r a d e on t h e w o r l d market (which i s l a r g e l y Japanese) i n c o m p e t i t i o n w i t h the Japanese. T h i s company proposes t o h a r v e s t w i l d k e l p or buy c u l t u r e d p l a n t s ( i f the q u a l i t y of farm grown p l a n t s i s a c c e p t a b l e ) and p r o c e s s a range of p r o d u c t s f o r w o r l d m a r k e t s . I n i t i a l l y two p r o d u c t s are b e i n g c o n s i d e r e d : one, kombu d e s t i n e d f o r O r i e n t a l markets; and two, l a m i n a r i a t e n t s f o r w h i c h t h e r e i s an i n t e r n a t i o n a l demand (Kirkwood, p . c ) . To s e l l B r i t i s h Columbia kombu i n Japan two o b s t a c l e s must be overcome. F i r s t , the p r o d u c t , i f produced from L a m i n a r i a , must be a c c e p t e d i n t o the c o u n t r y . Second, the B r i t i s h Columbia t r a d e r would then have t o s e l l t o an a p p o i n t e d "agent" of the o r g a n i z a t i o n r e p r e s e n t i n g the Japanese p r o d u c e r s . T h i s "agent" would then s e l l t o a p r o c e s s o r who would, i n t u r n , s e l l t o the l o c a l and w o r l d markets. I t i s i m m e d i a t e l y a p p a r e n t t h a t B r i t i s h Columbia p r o d u c e r s would be e x p o r t i n g a p r i m a r y d r i e d p r o d u c t w i t h the b e n e f i t s of secondary p r o c e s s i n g g o i n g t o the Japanese i n d u s t r y . B.C.J. T r a d i n g Co. proposes t o break t h i s monopoly and compete at the end of the c h a i n as a w o r l d t r a d e r . As a component of the B r i t i s h Columbia S c i e n c e C o u n c i l g r a n t t o d e v e l o p k e l p c u l t u r e t e c h n o l o g y i n B r i t i s h Columbia an assessment was proposed of l o c a l markets f o r kombu farm 46 p r o d u c t i o n . A c o n s u l t a n t was h i r e d i n the f a l l of 1982 t o a s s e s s l o c a l markets w i t h an emphasis on main stream "snack f o o d " . K e l p c h i p s , k e l p c r a c k e r s and powdered k e l p have been c o n s i d e r e d f o r l o c a l markets (Rosenberg, p . c ) . The t r a d i t i o n a l use of kombu i s as a soup base. For i n t e r n a t i o n a l markets r o e -o n - k e l p and m e d i c a l a p p l i c a t i o n s have been s u g g e s t e d . In 1984, t o t a l kombu farm p r o d u c t i o n s t o o d a t 1,364 kg. per year (Rosenberg, p . c ) . No f i r m m a r k e t i n g p r o p o s a l s have been s u g g e s t e d but i n d i v i d u a l l y , growers a r e c o n f i d e n t t h a t they can market t h e i r h a r v e s t e d k e l p . As farm p r o d u c t i o n i n c r e a s e s t h e r e i s some doubt whether the u n c o o r d i n a t e d e f f o r t s of i n d i v i d u a l grower's w i l l remain adequate t o market the t o t a l p r o d u c t i o n . There has been i n t e r e s t i n o r g a n i z i n g t h e kombu farmers a l o n g the l i n e s of B r i t i s h Columbia mushroom growers (Rosenberg, p . c ) . As a c o - o p e r a t i v e the farmers would s e l l t h e i r p r o d u c t t o a Canadian t r a d e r whose agent i n Japan has s e c u r e d p a r t of the import q u o t a . W h i l e t h e r e a r e m e r i t s t o o r g a n i z i n g the kombu farmers t h e r e i s no r e a l e x p e c t a t i o n t h a t Japanese buyers w i l l a c c e p t an im p o r t e d p r o d u c t on e q u a l terms w i t h t h e i r own c u l t u r e d kombu. Y e t , f o r farm p r o d u c t i o n t o be e c o n o m i c a l l y v i a b l e B r i t i s h Columbia p r o d u c e r s w i l l l i k e l y r e q u i r e the premium p r i c e a s s o c i a t e d w i t h h i g h - q u a l i t y c u l t u r e d f o o d s t u f f s . 47 3.4 C o s t s Of P r o d u c t i o n In B r i t i s h Columbia P r o d u c t i o n c o s t s have been p r o v i d e d by B.C.J. T r a d i n g Co. (Kirkwood, p.c.) and by Canadian K e l p Resources L t d . ( D r u e h l , p . c ) . The B.C.J. T r a d i n g Co. f i g u r e s r e f e r t o t h a t company's h a r v e s t of w i l d k e l p i n 1980 and the p r o d u c t i o n c o s t s p r o v i d e d by Canadian K e l p Resources L t d . a r e e s t i m a t e s c o m p i l e d by Dr. D r u e h l i n December of 1982. In 1980, between June and September, B.C.J. T r a d i n g Co. undertook a h a r v e s t of w i l d e d i b l e k e l p s u s i n g a p r o c e d u r e adapted from Japanese methods. With the f i n a n c i a l a s s i s t a n c e of a $28,500 A g r i c u l t u r a l and R u r a l Development S u b s i d i a r y Agreement (A.R.D.S.A.) g r a n t , a p r o c e s s i n g p l a n t was e s t a b l i s h e d i n the P o r t M c N e i l a r e a . Over the 4 month o p e r a t i o n 18 d i v e r s were h i r e d a t between $ 1500-2000/month and depending on the s u p p l y of k e l p 20-30 p l a n t workers were employed a t a r a t e of $6-7/hour. These wages were a p p r o x i m a t e l y 50% s u b s i d i z e d by an Unemployment I n s u r a n c e Commission (U.I.C.) programme d e s i g n e d t o a s s i s t s m a l l b u s i n e s s and encourage r u r a l employment. The h a r v e s t was i n i t i a t e d on the s t r e n g t h of a bank note p r o v i d e d by a Japanese buyer who u l t i m a t e l y d e f a u l t e d on the d e a l . I n s t e a d , the season's p r o d u c t i o n of 30.5 d r y tonnes was s o l d t o a Japanese Canadian f o r $ 3 . 7 5 / l b . (F.O.B. P o r t M c N e i l ) . The kombu now r e t a i l s i n Vancouver f o r $6.50/lb. T h i s v e n t u r e was not h i g h l y debt f i n a n c e d but s i n c e no buyer o f f e r r e d t o f i n a n c e subsequent p r o d u c t i o n the o p e r a t i o n f o l d e d a f t e r one season and a l l a s s e t s were l i q u i d a t e d . The 48 s u g g e s t i o n i s t h a t the o r i g i n a l d e a l f e l l t hrough when the Japanese buyer was g i v e n the o p p o r t u n i t y t o purchase Korean kombu (Kirkwood, p . c ) . On b a l a n c e , the v e n t u r e o p e r a t e d a t a net l o s s f o r B.C.J. T r a d i n g Co. The p r o d u c t i o n c o s t s p r o v i d e d by Canadian K e l p Resources L t d . a r e e s t i m a t e s based on farm o p e r a t i o n s which a r e i n an e a r l y stage of development. In s t r i k i n g c o n t r a s t t o the p r e v i o u s example, the c o s t of l a b o u r has been o m i t t e d from t h e s e e s t i m a t e s . T h i s o m i s s i o n was j u s t i f i e d on the b a s i s t h a t , f o r a c o t t a g e i n d u s t r y , an h o u r l y r a t e a p p l i e d t o l a b o u r investment would lower the p r o f i t margin u n r e a l i s t i c a l l y . A subsequent r e v i e w of c u l t u r e d kombu p r o d u c t i o n c o s t s f o r the S c i e n c e C o u n c i l of B r i t i s h Columbia ( E n v i r o c o n L t d . , 1984) r e j e c t e d t h i s a s s umption as e c o n o m i c a l l y unsound. However, the need f o r p a i d h e l p i s a n t i c i p a t e d by D r u e h l d u r i n g c e r t a i n s t a g e s of development and a t h a r v e s t t i m e . G i v e n o p e r a t i n g expenses which i n c l u d e farm c o n s t r u c t i o n and r e p l a c e m e n t , seed c o s t s , s h i p p i n g c o s t s , p r i c e of a • f o r e s h o r e l e a s e and i n s u r a n c e , the o p e r a t o r s of the e x p e r i m e n t a l kombu farms a n t i c i p a t e a r e q u i r e d $4/dry kg. w h o l e s a l e p r i c e t o break even. A subsequent, independent economic a n a l y s i s s u g g e s t s t h a t the break even p o i n t i s between $6-12/dry kg. ( E n v i r o c o n L t d . , 1984). Labour and m a t e r i a l s f i g u r e v e r y c o s t l y i n t he independent a n a l y s i s . 49 3.5 Summary The s u p p l y of c u l t u r e d kombu i s now a t the development s t a g e . O r i e n t a l markets a re w e l l - s u p p l i e d a t t h i s t i m e so any su c c e s s i n t h i s s e c t o r w i l l depend on the development of l o c a l markets f o r b o t h t r a d i t i o n a l and n o n - t r a d i t i o n a l p r o d u c t s . Co-o r d i n a t e d m a r k e t i n g e f f o r t s r a t h e r than the e f f o r t s of i n d i v i d u a l p r o d u c e r s o f f e r e f f i c i e n c y advantages. F i n a l l y , r e a l i s t i c economic c o n s i d e r a t i o n of p r o d u c t i o n c o s t s s u g g e s t s t h a t a premium p r i c e f o r p r o d u c t s w i l l be r e q u i r e d . In the p a s t , h i g h - q u a l i t y f o o d s t u f f s have been the o n l y p r o d u c t t o command such a r e t u r n . 4. PORPHYRA-NORI Por p h y r a spp. i s i n d i g e n o u s t o the Canadian west c o a s t but i t does not o c c u r i n s u f f i c i e n t c o n c e n t r a t i o n s t o support a commercial h a r v e s t i n g o p e r a t i o n . In B r i t i s h C o l u m b i a , the p o t e n t i a l f o r P o r p h y r a h a r v e s t i n g and n o r i p r o d u c t i o n i s t i e d t o the s u c c e s s of Washington s t a t e ' s e x t e n s i v e n o r i m a r i c u l t u r e program and the a d a p t a b i l i t y of t h i s program t o B r i t i s h Columbia's e n v i r o n m e n t a l and economic c o n d i t i o n s . 50 4.1 Supply B r i t i s h Columbia i s not p r e s e n t l y i n v o l v e d i n the h a r v e s t i n g of P o r p h y r a or p r o d u c t i o n of n o r i . Washington s t a t e i s growing c u l t u r e d n a t i v e P o r phyra on t e s t farms; but the p r o d u c t i o n of n o r i i s dominated by Japan, South Korea and C h i n a . Japan i s t h e w o r l d ' s l a r g e s t s u p p l i e r of n o r i . I n 1980, Japan's t o t a l n o r i p r o d u c t i o n was 8.3 b i l l i o n s h e e t s w i t h a w h o l e s a l e v a l u e of over U.S.$500 m i l l i o n (Kramer, C h i n and Mayo, 1982). South Korea's 1981 p r o d u c t i o n of 3.4 b i l l i o n s h e e t s was m a i n l y r e q u i r e d f o r domestic consumption and w h o l e s a l e v a l u e can be e s t i m a t e d a t between U.S.$120-193 m i l l i o n (Kramer, C h i n and Mayo, 1982). In 1979, China's p r o d u c t i o n was about 7200 dry tonnes and worth about U.S.$30 m i l l i o n (Tseng, 1981). P r o d u c t i o n i n t h e s e a r e a s i s w e l l e s t a b l i s h e d and based e n t i r e l y on c u l t u r e d P o r p h y r a u s i n g t e c h n i q u e s o r i g i n a t e d i n Japan. Taiwan, the P h i l i p p e a n s , New Zealand and the B r i t i s h I s l e s have a l s o been i n v o l v e d i n the p r o d u c t i o n of n o r i ( a l s o c a l l e d p u r p l e l a v e r ) but t h e s e r e g i o n s are not l i k e l y t o be i n v o l v e d i n e x p o r t . W i t h the e x c e p t i o n of some c u l t i v a t i o n i n Taiwan, t h e i r p r o d u c t i o n i s based on w i l d s t o c k s and t h e r e f o r e l i m i t e d t o l o c a l o c c u r a n c e and a v a i l a b i l i t y . In the p a s t two decades China has d e v e l o p e d an i m p r e s s i v e marine p l a n t m a r i c u l t u r e program. About 3400 h e c t a r e s of sea s u r f a c e a r e p r e s e n t l y devoted t o P o r p h y r a farms (Tseng, 1981). The h a r v e s t i s d o m e s t i c a l l y consumed i n food p r e p a r a t i o n and c u r r e n t m a r i c u l t u r e r e s e a r c h e f f o r t s suggest t h a t P o r p h y r a w i l l 51 assume an i n c r e a s i n g l y i m p o r t a n t r o l e i n the Chinese d i e t . The i n f e r r e d c o n c l u s i o n i s t h a t China w i l l not l i k e l y emerge as a s u p p l i e r of n o r i on w o r l d m arkets. At p r e s e n t , up t o 98% of a l l Korean n o r i i s consumed d o m e s t i c a l l y u n l i k e the 1950's when up t o 90% of p r o d u c t i o n was e x p o r t e d t o Japan (Kramer, C h i n and Mayo, 1982). I t i s u n c l e a r whether t h e s e e x p o r t s were c a n c e l l e d because of problems w i t h p r o d u c t i o n and growing demand i n Korea or because of c o n t i n u e d o v e r - p r o d u c t i o n ,in Japan. Kramer, Chi n and Mayo (1982) r e p o r t t h a t Korea has r e q u e s t e d a resumption of t h i s t r a d e and the r i g h t t o e x p o r t 2 m i l l i o n n o r i s h e e t s t o Japan. C u r r e n t l y , Korea's o n l y e x p o r t s a r e t o communities of e x p a t r i a t e s o v e r s e a s , i n c l u d i n g the U n i t e d S t a t e s . N o r i p r o d u c t i o n i n Korea i s government c o n t r o l l e d and the o f f i c i a l p o s i t i o n i s t h a t p r o d u c t i o n c o u l d e a s i l y i n c r e a s e by 50%. In a d d i t i o n t o b e i n g the l a r g e s t producer and consumer of n o r i , Japan i s a l s o the l a r g e s t s u p p l i e r of n o r i f o r w o r l d t r a d e . S i n c e 1978, n o r i p r o d u c t i o n i n Japan has exceeded i n d u s t r y t a r g e t p r o d u c t i o n l e v e l s by 10-20% (Kramer, Ch i n and Mayo, 1982). T h i s c h r o n i c o v e r - p r o d u c t i o n has r e s u l t e d i n f l o o d e d d i s t r i b u t i o n c h a n n e l s and a need f o r i n d u s t r y t o f i n d ways of i n c r e a s i n g demand w h i l e r e d u c i n g both the b a c k l o g and f u t u r e p r o d u c t i o n . In 1980, Japanese n o r i p r o d u c t i o n was r e p o r t e d a t 8.3 b i l l i o n s h e e t s . E s t i m a t e d consumption was 7.9 b i l l i o n s h e e t s and t h e r e was an accumulated b a c k l o g of a p p r o x i m a t e l y 4 b i l l i o n s h e e t s (Kramer, Ch i n and Mayo, 1982). T h i s b a c k l o g r e p r e s e n t s 52 h a l f the a n n u a l p r o d u c t i o n and i s r e p o r t e d by i n d u s t r y s o u r c e s to c o n s i s t of i n f e r i o r q u a l i t y n o r i . A s h i f t t o f l o a t i n g r a f t c u l t u r e i n c o m b i n a t i o n w i t h o i l and c h e m i c a l p o l l u t i o n , a d v e r s e weather and d i s e a s e caused by too i n t e n s i v e f a r m i n g have caused a d r a m a t i c r e d u c t i o n i n the p r o d u c t i o n of t o p q u a l i t y n o r i . A poor q u a l i t y p r o d uct has s e r i o u s l y d e t e r r e d growth of n o r i consumption i n Japan and consumption appears s t a t i c a t about 7.9 b i l l i o n s h e e t s per year (Kramer, C h i n and Mayo, 1982). These t r e n d s and r e p o r t e d f i g u r e s suggest t h a t the Japanese n o r i i n d u s t r y w i l l c o n t i n u e t o l o o k t o e x p o r t markets as a s o u r c e of revenue and as a means t o reduce i t s s e r i o u s b a c k l o g . L o c a l e x p e r i e n c e suggests t h a t w h o l e s a l e r s w i l l buy Canadian i f the product i s p r i c e and q u a l i t y c o m p e t i t i v e . 4.2 Demand World markets f o r n o r i c e n t e r around Taiwan, K o r e a , the U n i t e d S t a t e s and o t h e r c o u n t r i e s t h a t h o s t s u b s t a n t i a l numbers of Japanese or Korean immigrants and r e l o c a t e d Japanese businessmen. L e s s e x p e c t e d i s the use of Porphyra i n the B r i t i s h I s l e s where i t i s known as l a v e r . M i n e r s i n Southern Wales consume 163 wet tonnes a n n u a l l y . T h i s demand i s w e l l e s t a b l i s h e d and t r a d i t i o n a l l y s a t i s f i e d by raw m a t e r i a l i m p o r t e d from E n g l a n d , S c o t l a n d , N o r t h e r n Wales and I r e l a n d (Hansen e t  a l . , 1981). 53 W h i l e Korea p e r i o d i c a l l y i m p o r t s n o r i t o make up f o r p r o d u c t i o n f a i l u r e s p r o d u c t i o n has been i n c r e a s i n g s i n c e 1978 and e x p o r t s , p a r t i c u l a r i l y t o the U n i t i e d S t a t e s , a r e i n c r e a s i n g . W h i l e t h e r e i s no s p e c i f i c r e s t r i c t i o n on n o r i i m p o r t s the Korean government has t r a d i t i o n a l l y been h i g h l y p r o t e c t i v e of l o c a l p r o d u c t i o n . Coupled w i t h the view t h a t Korean n o r i p r o d u c t i o n can double t h e r e i s l i t t l e l i k e l i h o o d of a new source of s u p p l y p e n e t r a t i n g the Korean market. The o n l y f o r e i g n produced n o r i t o appear i n Japan has been from Korea. R e l a t i v e l y s m a l l amounts of n o r i were p e r m i t t e d on the market; but today t h i s arrangement i s not i n e f f e c t and n o r i p r o d u c t s a r e s u b j e c t t o s t r i c t import q u o t a s . W i t h Japan a c t i v e l y t u r n i n g t o f o r e i g n markets t o reduce the p r e s s u r e s of o v e r - p r o d u c t i o n i t i s u n l i k e l y t h a t a B r i t i s h Columbia n o r i i n d u s t r y c o u l d r e l y on d e v e l o p i n g a Japanese market. However, t h e r e i s one remote e x c e p t i o n . I f new s o u r c e s of n o r i proved t o be h i g h i n q u a l i t y then t h e r e i s a p o t e n t i a l market i n Japan where demand f o r h i g h q u a l i t y n o r i i s s t r o n g and p r i c e s can r e a c h 25 t i m e s the base p r i c e (Kramer, Chi n and Mayo, 1982). C a p t u r e of t h i s market would be s u b j e c t t o removal of the import q u o t a and c o m p e t i t i o n w i t h o t h e r n o r i e x p o r t e r s . One c o u l d s p e c u l a t e t h a t i t was t o e n t e r t h i s market t h a t Korea a p p l i e d t o the Japanese government f o r p e r m i s s i o n t o import 2 m i l l i o n n o r i s h e e t s . The U n i t e d S t a t e s i m p o r t e d 15.5 m i l l i o n s h e e t s of Japanese n o r i worth U.S.$2.8 m i l l i o n i n 1980 (Kramer, C h i n and Mayo, 1982). A s i m i l a r amount was i m p o r t e d from K o r e a . T h i s 54 r e p r e s e n t s a 3 - f o l d i n c r e a s e over a 4-year p e r i o d and exceeds consumption as p r e d i c t e d by the number of Japanese Americans and d i s p l a c e d Japanese businessmen. Such growth s u g g e s t s t h a t , i n the U n i t e d S t a t e s a t l e a s t , n o r i consumption i s expanding t o i n c l u d e a b roader segment of the p o p u l a t i o n . N o r i i s marketed i n B r i t i s h C olumbia. In 1983, 3960 kg of n o r i v a l u e d a t $342,540 w h o l e s a l e and $530,640 r e t a i l were impor t e d t o B r i t i s h C o lumbia. P r i c e ranges (1983) based on i m p o r t / w h o l e s a l e companies and r e t a i l o u t l e t s i n Vancouver and V i c t o r i a v a r y from $ 5 2 - 1 2 l / d r y kg w h o l e s a l e t o $ 7 2 - l 9 6 / d r y kg r e t a i l (Coon, p . c ) . 4.3 Market S c e n a r i o s For B r i t i s h Columbia N o r i No r i g o r o u s market a n a l y s i s has been un d e r t a k e n f o r p o t e n t i a l n o r i p r o d u c t i o n i n B r i t i s h Columbia. In Washington S t a t e however, such an a n a l y s i s was r e c e n t l y completed (Kramer, C h i n and Mayo, 1982) and the f i n d i n g s have r e l e v a n c e t o d e c i s i o n s about markets f o r n o r i p r o d u c t s produced i n B r i t i s h Columbia as w e l l as Washington. The r e p o r t c o n c l u d e d t h a t of the range of P o r p h y r a p r o d u c t s , n o r i s h e e t s would be the most adventageous t o market and t h a t a Washington-based n o r i i n d u s t r y s h o u l d t a r g e t e x i s t i n g U n i t e d S t a t e s markets. Japanese n o r i i n d u s t r y d e l e g a t e s r e c e n t l y t o u r e d the U n i t e d S t a t e s and c o n c l u d e d t h a t : 55 a. the q u a l i t y of n o r i a v a i l a b l e i n the U n i t e d S t a t e s was v e r y poor; b. Japanese r e s t a u r a n t s and p a r t i c u l a r i l y s u s h i b a r s were i n c r e a s i n g r a p i d l y ; c. n o r i ' s h e a l t h b e n e f i t s s h o u l d be emphasized; and d. r o a s t e d and seasoned n o r i s h o u l d be promoted i n the household market w i t h c a r e f u l l y d e s i g n e d programs of consumer e d u c a t i o n (Kramer, C h i n and Mayo, 1982). The Japanese n o r i i n d u s t r y a n t i c i p a t e s p o t e n t i a l b e n e f i t s i n Washington s t a t e ' s p l a n t o c u l t i v a t e n o r i . Domestic p r o d u c t i o n would arouse consumer i n t e r e s t and encourage the development of p r o d u c t s w i t h broad N o r t h American a p p e a l . With i n c r e a s e d demand and l i m i t e d a r e a f o r expanded c u l t i v a t i o n i n Washington most of the n o r i r e q u i r e d t o meet demand would be i m p o r t e d (Kramer, C h i n and Mayo, 1982). W h i l e t h i s s c e n a r i o p r e s e n t s a f a v o u r a b l e o u t l o o k f o r Japanese e x p o r t s i t a l s o s u g g e s t s a p o s s i b l e f o o t i n g on which t o base a B r i t i s h Columbia c u l t u r e o p e r a t i o n . The market p l a n a n a l y s i s s u g g ested t h r e e v i a b l e farm s i z e s (Kramer, C h i n and Mayo, 1982). Annual p r o d u c t i o n on the 200-saku ( c u l t u r e d net) and 300-saku s i z e farms w a s • p r e d i c t e d t o re a c h 2 m i l l i o n and 3 m i l l i o n s h e e t s and c a p t u r e 2% and 6% of the market r e s p e c t i v e l y . I t was a n t i c i p a t e d t h a t f a c i l i t i e s of t h i s s i z e c o u l d e n t e r the e x i s t i n g w h o l e s a l e d i s t r i b u t i o n c h a n n e l s w i t h l i t t l e impact. The l a r g e r 2000-saku farm was e x p e c t e d t o c a p t u r e 20% of the market and r e q u i r e a m a r k e t i n g s t r a t e g y t o e i t h e r d i s p l a c e a p o r t i o n of e x i s t i n g s u p p l y o r i n c r e a s e c u r r e n t demand. Kramer, C h i n and Mayo (1982) suggest a 56 m a r k e t i n g approach t h a t would t a r g e t a c o m b i n a t i o n of the f o l l o w i n g markets: a. bulk commodities, b. ' m i l i t a r y procurement, c. i n g r e d i e n t s a l e s , d. r e s t a u r a n t and food s e r v i c e s , e. s p e c i a l t y food markets, f . m a i l o r d e r , and g. super markets. 4 . 4 C o s t s "Of ^ P r o d u c t i o n The f o l l o w i n g summary i s based on the a n a l y s i s by Kramer, C h i n and Mayo (1982) of the c o s t s of n o r i p r o d u c t i o n i n Washington s t a t e . The o p e r a t i o n a l a s s u m p t i o n s and economics of the i n d u s t r y i n Washington p r o v i d e a s t a n d a r d a g a i n s t which p o t e n t i a l n o r i p r o d u c t i o n i n B r i t i s h Columbia can be compared and a g a i n s t which B r i t i s h Columbia n o r i would l i k e l y compete. R e g a r d i n g Porphyra c u l t u r e i n Puget Sound t h e assumptions a r e : 1. a r t i f i c i a l p r o p a g a t i o n 2. 200-day h a r v e s t season 3. a p p r o x i m a t e l y 40-day growth per net 4. 10-day r o t a t i n g h a r v e s t c y c l e 57 5. h a r v e s t from October 1 t o June 30 6. August s e e d i n g 7. September n u r s e r y p e r i o d 8. y i e l d of a p p r o x i m a t e l y 500 s h e e t s per net 9. 12 saku per a c r e of w e t l a n d s 10. 3 h a r v e s t s per net a n n u a l l y . These assumptions r e f l e c t the near p e r f e c t growing c o n d i t i o n s f o r n a t i v e P o r p h y r a i n Puget Sound. A l o n g e r growing season and lower d i s t r i b u t i o n c o s t s i n Washington S t a t e r e s u l t i n a s i g n i f i c a n t c o s t advantage f o r S t a t e n o r i p r o d u c e r s . In the U n i t e d S t a t e s market Korean n o r i c u r r e n t l y c o s t s 3.5-5.5 c e n t s per s h e e t ; Japanese n o r i c o s t s 6-7 c e n t s per s h e e t ; and Washington grown n o r i i s e x p e c t e d t o c o s t 2-8 c e n t s per sheet depending on farm s i z e . However, as a m a r k e t i n g s t r a t e g y , a f o r e i g n n o r i s u p p l i e r , backed by huge p r o d u c t i o n volumes, c o u l d u n d e r c u t d o m e s t i c p r i c e s j u s t t o keep the market open. The economics of the proposed n o r i i n d u s t r y were a s s e s s e d c o n s i d e r i n g a p r o c e s s i n g system based on automated s h e e t - f o r m i n g and d r y i n g equipment and a r e v i e w of o p e r a t i o n a l and f a c i l i t i e s r e q u i r e m e n t s . Four farm s i z e s were' c o n s i d e r e d and w i t h the e x c e p t i o n of the 100-saku farm each appeared t o be e c o n o m i c a l l y v i a b l e . I t was c o n c l u d e d t h a t the 200, 300 and 2000-saku farms s h o u l d each make money by the second year of o p e r a t i o n . At the end of the t h i r d year of o p e r a t i o n and t h e r e a f t e r the 300-saku farm would g e n e r a t e the h i g h e s t r a t e of r e t u r n on e q u i t y f o l l o w e d c l o s e l y by the 2000-saku farm. These f i n d i n g s a r e 58 based on c o n s e r v a t i v e f i n a n c i a l e s t i m a t e s but r e l y on optimum p r o d u c t i o n f o r e c a s t s w i t h no p r o v i s i o n s f o r a b e r r a t i o n s i n e n v i r o n m e n t a l f a c t o r s or the human i n p u t . Proforma c a s h f l o w s were c a l c u l a t e d w i t h p u b l i c revenues b e i n g g e n e r a t e d by e i t h e r a l e a s e fee of $1000 per a c r e of s t a t e c o n t r o l l e d w e t l a n d or a t a x a p p l i e d t o revenues. Cash f l o w s f o r the 200 and 300-saku farms b e n e f i t from the t a x approach w h i l e the 2000-saku farm b e n e f i t s from a l e a s e f e e . The s i z e of the p r o c e s s i n g o p e r a t i o n f o r the 2000-saku farm s u g g e s t s t h a t secondary p r o c e s s i n g i s an e v e n t u a l g o a l . As revenue i s i n t e r n a l l y g e n e r a t e d the n e c e s s a r y secondary p r o c e s s i n g equipment can be purc h a s e d and the t a r g e t e d markets can be s u p p l i e d . The added expense of secondary p r o c e s s i n g i s o f f s e t by a h i g h e r market v a l u e f o r the p r o d u c t , so as the 2000-saku o p e r a t i o n moves i n t o secondary p r o c e s s i n g the p r o f i t a b i l i t y does not d e c r e a s e . 4.5 Summary The p r o d u c t i o n of c u l t u r e d P o r p h y r a i s a t the r e s e a r c h phase and t h e r e a r e known m a r k e t i n g problems. At p r e s e n t , the p r i n c i p a l markets f o r Porphyra p r o d u c t s a r e i n the O r i e n t and t h e s e markets a r e both o v e r - s u p p l i e d and p r o t e c t e d by import r e s t r i c t i o n s . The o n l y e x c e p t i o n i s a s t r o n g demand f o r h i g h q u a l i t y n o r i . Development of N o r t h American n o r i p r o d u c t i o n i s t i e d t o the i d e n t i f i c a t i o n , p e n e t r a t i o n and development of l o c a l 59 markets. The c o s t s of p r o d u c t i o n have been a s s e s s e d f o r the S t a t e of Washington. 5. GELIDIUM-BACTERIOLOGICAL GRADE AGAR A w i n t e r growing G e l i d i u m s p e c i e s i s b e i n g s t u d i e d a t the B a m f i e l d M arine S t a t i o n as a p o s s i b l e source of b a c t e r i o l o g i c a l grade a g a r . T r a d i t i o n a l l y , agar has been d e r i v e d from G e l i d i u m but i n c r e a s i n g w o r l d demand f o r the c o l l o i d has seen the u t i l i z a t i o n of o t h e r a g a r o p h y t e s f o r the p r o d u c t i o n of a d d i t i o n a l , but lower q u a l i t y , a g a r . Today, G e l i d i u m i s the p r i n c i p a l s ource of a l l b a c t e r i o l o g i c a l grade a g a r . T h i s h i g h q u a l i t y agar r e p r e s e n t s about 15% of the t o t a l w o r l d market f o r agar and i t i s i n t h i s market t h a t B r i t i s h Columbia d e r i v e d agar would be r e q u i r e d t o compete. W h i l e Ge1idiurn i s not c u l t u r e d on a commercial s c a l e i n B r i t i s h Columbia c u r r e n t e f f o r t s a r e b e i n g d i r e c t e d a t the p r o d u c t i o n of s u f f i c i e n t p l a n t m a t e r i a l f o r a p i l o t - s c a l e e x t r a c t i o n of b a c t e r i o l o g i c a l grade agar and subsequent t e s t m a r k e t i n g . 5.1 Supply And Demand American Agar Co., l o c a t e d i n San D i e g o , i s the o n l y p roducer of h i g h q u a l i t y agar i n N o r t h America. T h i s company buys G e l i d i u m from C a l i f o r n i a and r e g u l a r i l y i m p o r t s about h a l f 60 of i t s needs from S p a i n , Morocco, C h i l e , A r g e n t i n a , P o r t u g a l and Mexico (Hansen, e t a l . , 1981). New Zealand produces a h i g h q u a l i t y agar from P t e r o c l a d i a . N e a r l y a l l domestic p r o d u c t i o n i s consumed w i t h i n New Z e a l a n d and the s m a l l volume of e x p o r t i s not c o n s i d e r e d an i m p o r t a n t f a c t o r i n w o r l d markets (Hansen, e t  a l . , 1981). S p a i n and Morocco have d e v e l o p e d s i g n i f i c a n t agar i n d u s t r i e s which p r o v i d e h i g h q u a l i t y b a c t e r i o l o g i c a l agar f o r w o r l d t r a d e . P o r t u g a l has a l s o emerged i n r e c e n t y e a r s as a p r o d u c e r of q u a l i t y agar (Woods, Gordon and Co., 1978). C o u n t r i e s r e g u l a r i l y i m p o r t i n g over 50 tonnes of agar per year i n c l u d e J a p a n , U n i t e d S t a t e s , U n i t e d Kingdom, West Germany, T h a i l a n d , M a l a y a , S i n g a p o r e , I t a l y , H o l l a n d , F r a n c e , Berma, R u s s i a and A u s t r a l i a ( B i s s e l l , 1972). The q u a l i t y of t h i s agar i s not s p e c i f i e d ; but t o t a l w o r l d p r o d u c t i o n and consumption i n 1977 was a p p r o x i m a t e l y 580 tonnes f o r b a c t e r i o l o g i c a l agar and 6000 tonnes of f o o d / i n d u s t r i a l grade agar (Woods, Gordon and Co., 1978). A n n u a l l y , i n t h e U n i t e d S t a t e s and Canada over 250 tonnes of b a c t e r i o l o g i c a l grade agar a r e consumed and growth i n consumption i s between 20-30% (Woods, Gordon and Co., 1978). A 1978 market survey (Woods, Gordon and Co.) noted t h a t on a p l a n t b a s i s t h e i n d u s t r y i s fragmented. In Japan a l o n e , t h e r e a r e some 432 agar p l a n t s of v a r y i n g s i z e . However, t h e r e i s a c o n c e n t r a t i o n i n ownership and c o n t r o l i n terms of p r o d u c t i o n volume r e p r e s e n t e d by the major agar e x t r a c t o r s . The Prona group, based i n S p a i n , e i t h e r owns or c o n t r o l s 17 agar p l a n t s w o r l d wide and a c c o u n t s f o r 50-70% of w o r l d agar p r o d u c t i o n ! 61 5.2 Market S c e n a r i o s American Agar Co. has i n d i c a t e d i t would t e s t a 1 pound d r y sample of B r i t i s h Columbia c u l t u r e d G e l i d i u m and r a t e i t s q u a l i t y . I f the q u a l i t y met t h e i r r e q u i r e m e n t s they would then be w i l l i n g t o buy the B r i t i s h Columbia s u p p l y of G e l i d i u m ( T u r n b u l l , p . c ) . S e v e r a l e x t r a c t o r s i n Europe import G e l i d i u m t o meet t h e i r p r o d u c t i o n of b a c t e r i o l o g i c a l agar but they have not e x p r e s s e d i n t e r e s t or optimism i n B r i t i s h Columbia G e l i d i u m (Hansen, et a l ., 1981). Very l i t t l e agar i s imported d i r e c t l y i n t o Canada because of the low l e v e l of m a n u f a c t u r i n g a c t i v i t y i n Canada ( B i s s e l l , 1972). Most of the agar consumed i n Canada i s i m p o r t e d from the U n i t e d S t a t e s a l r e a d y i n c o r p o r a t e d i n t o i t s f i n i s h e d p r o d u c t . B i s s e l l (1972) r e p o r t s t h a t the major problems i n d i s t r i b u t i n g agar i n the Canadian and U n i t e d S t a t e s markets a r e : l a c k of s t a b i l i t y i n the source of s u p p l y ; q u a l i t y of the p r o d u c t ; q u a n t i t y a v a i l a b l e f o r p u r c h a s e ; and i n p r i c e . A c o n t r o l l e d s o u r c e of s u p p l y would be welcomed under t h e s e c o n d i t i o n s and t h e r e a r e no e x i s t i n g U n i t e d S t a t e s t r a d e b a r r i e r s t o i n h i b i t Canadian e x p o r t of agar or a g a r o p h y t e s t o the U n i t e d S t a t e s . The p r e s e n t and p o t e n t i a l markets f o r B r i t i s h Columbia grown Ge1idiurn or B r i t i s h Columbia d e r i v e d b a c t e r i o l o g i c a l grade agar w i l l l i k e l y f o l l o w the h i s t o r i c c y c l i c a l t r e n d . The agar i n d u s t r y has been pl a g u e d w i t h a s e r i e s of p r e d i c t a b l e boom-and-bus t c y c l e s which have l e d t o the e s t a b l i s h m e n t and f a i l u r e of s e v e r a l s m a l l o p e r a t i o n s . To w i t h s t a n d t h e s e c y c l e s many 62 Japanese agar p l a n t s a r e s m a l l and s p o r a d i c i n p r o d u c t i o n . H i s t o r i c a l l y , as demand i n c r e a s e d , agar p r o d u c t i o n grew t o a l e v e l t h a t exceeded the a b i l i t y of agarophyte s t o c k s t o s u p p l y p r o d u c t i o n on a s u s t a i n e d b a s i s . When o v e r h a r v e s t i n g o c c u r r e d , r egrowth r a t e s f a i l e d t o m a t c h ' p r e v i o u s supply c a u s i n g p r i c e s t o i n c r e a s e d r a m a t i c a l l y f o r the p l a n t and the c o l l o i d . E x c e s s i v e p r i c e i n c r e a s e s e v e n t u a l l y l e d t o a r e d u c t i o n i n consumption below a c r i t i c a l l e v e l a t which p o i n t the beds c o u l d r e -e s t a b l i s h and the c y c l e r e p e a t . I t i s apparent t h a t the economics of agar p r o d u c t i o n w i l l s t a b a l i z e o n l y w i t h the development of m a r i c u l t u r e (Hansen, e t a l . , 1981). From 1975-1 980 w o r l d s u p p l i e s of Ge1idiurn were d e p r e s s e d and p r i c e s i n f l a t e d . D u r i n g t h i s p e r i o d b a c t e r i o l o g i c a l grade agar s o l d f o r $125/kg. and r e t a i l agarose f o r $250-780/kg. (Hansen, e t _ a _ l . , 1981). C u r r e n t l y , G e l i d i u m i n v e n t o r i e s are h i g h and p r i c e s are d e p r e s s e d . T u r n b u l l (p.c.) i n d i c a t e s t h a t American Agar Co. i s p r e s e n t l y b u y i n g G e l i d i u m f o r U.S.$8/lb.-U.S.$ 1300/ton. Green m a i n t a i n s t h e r e i s a s t r o n g market demand f o r h i g h q u a l i t y agar and c i t e s a r e t a i l p r i c e of $8000/kg. f o r agarose (Gunn, V a l i e l a and Green, 1983). By 1978, about 300 kg. of agarose were b e i n g used a n n u a l l y w o r l d wide (Woods, Gordon and Co., 1978). 63 5.3 C o s t s Of P r o d u c t i o n At t h i s p o i n t t h e r e i s no i n f o r m a t i o n on the a c t u a l or e x p e c t e d c o s t s of p r o d u c t i o n i n B r i t i s h Columbia. S h o u l d t e s t r e s u l t s from the proposed m a r k e t i n g of G e l i d i u m d e r i v e d agar be e n c o u r a g i n g then f u r t h e r r e s e a r c h and c o s t i n g w i l l be r e q u i r e d t o d e v e l o p e f f i c i e n t c u l t u r e and h a r v e s t i n g methods. I t s h o u l d be noted t h a t a l l b a c t e r i o l o g i c a l grade agar i s c u r r e n t l y s u p p l i e d by w i l d h a r v e s t . I t i s hoped t h a t the i n c r e a s e d c o s t s a s s o c i a t e d w i t h m a r i c u l t u r e i n B r i t i s h Columbia w i l l be o f f - s e t by a premium p r i c e p a i d f o r , what i s hoped t o be, h i g h q u a l i t y agar p r o d u c i n g G e l i d i u m . However, the p r o f i t margin of a Ge1idiurn m a r i c u l t u r e o p e r a t i o n i n B r i t i s h Columbia would l i k e l y be l e s s than any competing o p e r a t i o n r e l y i n g on w i l d s t o c k s . D r s . Foreman, DeWreede and Whyte propose t o d e v e l o p and t e s t a p i l o t - s c a l e agar e x t r a c t i o n p l a n t . Woods, Gordon and Co. (1978) have c o n c l u d e d t h a t a new B r i t i s h Columbia based agar e x t r a c t o r would have t o compete w i t h s e v e r a l e s t a b l i s h e d s u p p l i e r s and t h a t the e x t r a c t o r a s p e c t of the agar i n d u s t r y would l i k e l y be d i f f i c u l t t o e n t e r on a p r o f i t a b l e b a s i s because of the b a s i c n a t u r e of the w o r l d market demand. T h e i r c o n c l u s i o n assumed an annual growth i n demand of 20-30% f o r h i g h grade agar i n N o r t h America. 64 5.4 Summary Commercial p r o d u c t i o n of agar i n B r i t i s h Columbia must r e l y on a s u p p l y of c u l t u r e d G e l i d i u m . At t h i s t i m e , c u l t u r e t e c h n i q u e s a re a t the r e s e a r c h phase and no i n f o r m a t i o n i s a v a i l a b l e on the c o s t s of p r o d u c t i o n . At p r e s e n t , a l l agar i s d e r i v e d from w i l d s t o c k s . The a d d i t i o n a l c o s t s of p r o d u c i n g c u l t u r e d s t o c k s i n B r i t i s h Columbia have been r a t i o n a l i z e d on the b a s i s of the h i g h p r i c e p a i d f o r b a c t e r i o l o g i c a l grade a g a r . A n a l y s i s of B r i t i s h Columbia c u l t u r e d G e l i d i u m has c o n f i r m e d i t s h i g h q u a l i t y and a market f o r d r i e d h i g h q u a l i t y G e l i d i u m has been i d e n t i f i e d . American Agar Co. w i l l buy the d r i e d p l a n t f o r p r o d u c t i o n of b a c t e r i o l o g i c a l grade a g a r . There are no t r a d e b a r r i e r s t o the e x p o r t of agar t o the U n i t e d S t a t e s . However, a s u p p l y of raw m a t e r i a l cannot be c o n f i r m e d s i n c e funds have not been s e c u r e d t o move i n t o a development phase. Sources of s u p p l y , i d e n t i f i c a t i o n of markets and c o s t s of p r o d u c t i o n a r e l i s t e d and summarized i n T a b l e 3 as c r i t e r i a w hich d e t e r m i n e the economic f e a s i b i l i t y of p o t e n t i a l p r o d u c t s . 65 PRODUCT ECONOMICALLY CRITERIA FEASIBLE SUPPLY MARKETS $ PROD'N r o e - o n - k e l p yes yes known unknown f e r t i l i z e r no yes s u p p l i e d known kel p - m e a l yes yes known known c h e m i c a l e x t r a c t s no u n t e s t e d not committed known kombu no yes r e q u i r e s market dev'ment known n o r i no yes r e q u i r e s market dev'ment known agar no u n t e s t e d known unknown T a b l e 3 - Summary of Economic F e a s i b i l i t y of P o t e n t i a l P r o d u c t s 66 6. CONCLUSIONS T h i s c h a p t e r has i d e n t i f i e d s e v e r a l a r e a s of i n f o r m a t i o n which are c r i t i c a l t o f u t u r e development and pro m o t i o n of marine p l a n t p r o d u c t s from B r i t i s h Columbia. F i r s t , t he c o s t s of p r o d u c t i o n remain unknown f o r many proposed p r o d u c t s i n c l u d i n g r o e - o n - k e l p and a g a r . An economic a n a l y s i s of p o t e n t i a l kombu farm s i z e s i s a l s o n e c e s s a r y . Second, the q u a l i t y of p r o d u c t s from B r i t i s h Columbia remains unknown'. These p r o d u c t s i n c l u d e : a l g i n , agar and n o r i . T h i r d , market r e s e a r c h i n B r i t i s h Columbia has remained l a r g e l y i g n o r e d by promoters of a marine p l a n t i n d u s t r y . The f i n a l i n f o r m a t i o n r e q u i r e m e n t f o l l o w s from market r e s e a r c h . A need f o r p r o d u c t r e s e a r c h and development f o r the N o r t h American market i s c r i t i c a l f o r development of an i n d u s t r y i n B r i t i s h Columbia, p a r t i c u l a r l y w i t h r e s p e c t t o e d i b l e p r o d u c t s . Of the range of p r e s e n t and p o t e n t i a l marine p l a n t p r o d u c t s from B r i t i s h Columbia i t appears t h a t o n l y k e l p meal and roe-on-k e l p are e c o n o m i c a l l y v i a b l e a t t h i s t i m e . For r o e - o n - k e l p the market i s e s t a b l i s h e d w i t h growth p o t e n t i a l and f o r k e l p meal, markets a re r e p o r t e d i n N o r t h America and Europe. The c o s t s of p r o d u c t i o n f o r k e l p meal a r e known and w h i l e the c o s t of p r o d u c t i o n f o r r o e - o n - k e l p have not been d e t e r m i n e d , c o n t i n u e d demand f o r e n t r y i n t o t h i s branch of the i n d u s t r y s u g g e s t s i t s p r o f i t a b i l i t y . T h i s c h a p t e r has reviewed c u r r e n t l y a v a i l a b l e i n f o r m a t i o n t o a s s e s s the economics of p r o d u c i n g marine p l a n t p r o d u c t s i n 67 B r i t i s h Columbia. Based on t h i s economic a n a l y s i s i t has been p o s s i b l e t o s u g g e s t : which marine p l a n t p r o d u c t s are e c o n o m i c a l l y v i a b l e a t t h i s t i m e ; f a c t o r s which l i m i t economic v i a b i l i t y ; and what economic i n f o r m a t i o n i s e i t h e r a v a i l a b l e or l a c k i n g i n which t o base a s t r a t e g y f o r p l a n n i n g and managing the development of marine p l a n t r e s o u r c e s on the Canadian west c o a s t . 68 IV. INSTITUTIONAL OPPORTUNITIES AND CONSTRAINTS 1. INTRODUCTION T h i s c h a p t e r w i l l b e g i n w i t h a b r i e f r e v i e w of p a s t marine p l a n t i n d u s t r i a l a c t i v i t y on the west c o a s t . The reasons f o r the f a i l u r e of t h e s e p r e v i o u s development a t t e m p t s w i l l be i d e n t i f i e d and c a t e g o r i z e d . The c h a p t e r w i l l then t u r n t o a r e v i e w of the j u r i s d i c t i o n a l and i n s t i t u t i o n a l frameworks w i t h i n which a d e v e l o p i n g marine p l a n t i n d u s t r y must o p e r a t e . From thes e r e v i e w s and the c o n c l u s i o n s of Chapters I I and I I I the key i n d u s t r i a l o p p o r t u n i t i e s and c o n s t r a i n t s w i l l be i d e n t i f i e d . The c h a p t e r w i l l then t u r n t o c o n c l u s i o n s about p r i o r i t i e s f o r development of the marine p l a n t r e s o u r c e i n B r i t i s h C o lumbia. 2. HISTORICAL OVERVIEW OF SEAWEED ENTERPRISES IN BRITISH  COLUMBIA The f i r s t attempt t o h a r v e s t and p r o c e s s seaweed i n B r i t i s h Columbia was i n 1946 by Canada K e l p Co. L t d . (1946). The company p l a n n e d t o produce soap, k e l p meal (an e d i b l e p r o d u c t d e r i v e d from ground d r i e d k e l p ) , k e l p meal t a b l e t s and a l g i n a t e s (a c h e m i c a l e x t r a c t of k e l p employed i n the p r o d u c t i o n of many manufactured consumer g o o d s ) . However, o n l y a s m a l l q u a n t i t y of 69 d r i e d k e l p was produced from the k e l p beds at Deer I s l a n d b e f o r e f i n a n c i a l problems f o r c e d c l o s u r e i n 1948 (Whyte and E n g l a r , 1973; Vancouver Sun, p.A8, Nov.2, 1977). I t was not u n t i l 1965 t h a t t h e r e was a r e s u r g e n c e of i n t e r e s t i n seaweed h a r v e s t i n g and p r o c e s s i n g and by 1967 the e n t i r e B r i t i s h Columbia c o a s t l i n e was a l l o c a t e d under 44 h a r v e s t i n g l i c e n c e s h e l d by s i x companies (MRB Q u a r t e r l y R e p o r t s ; Coon p . c ) . Sidney Seaweed P r o d u c t s appears t o have been the most s u c c e s s f u l of these s i x f i r m s i n an on-going b u s i n e s s sense. T h i s o p e r a t i o n h a r v e s t e d l o c a l seaweeds but r e l i e d on i m p o r t e d seaweed e x t r a c t c o n c e n t r a t e t o produce and s u c c e s s f u l l y market l i q u i d f e r t i l i z e r s p r a y , s o i l c o n d i t i o n e r and compost a c t i v a t o r . The company remained v i a b l e u n t i l i t s owner r e t i r e d i n 1974 (Coon, p . c . ) . P a c i f i c K e l p Co. L t d . ( l a t e r Sea-Chem I n d u s t r i e s L t d . ) p l a n n e d t o produce a l g i n a t e s , l i v e s t o c k f e e d and f e r t i l i z e r . I t e s t i m a t e d a need f o r an a n n u a l c u t of a t l e a s t 90,000 tonnes of M a c r o c y s t i s and N e r e o c y s t i s t o meet i t s r e q u i r e m e n t s . A m o b i l e p i l o t - s c a l e a l g i n a t e e x t r a c t i o n f a c i l i t y was b u i l t and t e s t e d . However, $4 m i l l i o n i n f i n a n c i n g f o r c o n s t r u c t i o n of a c ommercial s c a l e a l g i n a t e f a c i l i t y i n the lower mainland a r e a c o u l d not be s e c u r e d because of the r i s k a s s o c i a t e d w i t h an u n t e s t e d marine p l a n t v e n t u r e (Coon, p . c ) . I n t e r - T i d a l I n d u s t r i e s L t d . i n i t i a l l y p l a n n e d t o h a r v e s t k e l p and combine i t w i t h i n c i n e r a t e d garbage and macerated f i r bark t o produce mulch. I n s t e a d , by 1968 an o p p o r t u n i t y t o 70 produce k e l p meal had been i d e n t i f i e d and a combined h a r v e s t i n g and p r o c e s s i n g barge was o p e r a t i o n a l and b e i n g t e s t e d . Nine hundred tonnes of N e r e o c y s t i s were c u t and d r i e d o f f the c o a s t of B r i t i s h C olumbia. The d r y i n g a p p a r a t u s was not e n t i r e l y s u c c e s s f u l and i n 1970 e i t h e r due t o a low p r o f i t margin f o r k e l p meal or f i n a n c i a l d i f f i c u l t i e s w i t h the p a r e n t company the o p e r a t i o n was t e r m i n a t e d and the equipment was put up f o r s a l e (Coon, p . c ) . Marine Chemical H a r v e s t e r s L t d . and Can-Kel I n d u s t r i e s L t d . showed no development a c t i v i t i e s and i n 1969 t h e i r l i c e n c e s were revoked. D u r i n g t h i s r e surgence of i n t e r e s t i n seaweed h a r v e s t i n g and p r o c e s s i n g , N o r t h P a c i f i c M a r ine P r o d u c t s L t d . was the l a r g e s t company i n terms of development a c t i v i t y and p h y s i c a l a s s e t s . N o r t h P a c i f i c Marine P r o d u c t s L t d . had e v o l v e d from S e a p l a n t C h e m i c a l and A l g i n C o r p o r a t i o n and i n 1966 h e l d k e l p h a r v e s t i n g l i c e n c e s f o r the e n t i r e Queen C h a r l o t t e I s l a n d s r e g i o n . In 1969 the company was renamed Canada K e l p Co. L t d . (1969). The company had p l a n s f o r a t h r e e - p h a s e d development t o be l o c a t e d near Masset (Coon, p . c ) . The f i r s t phase was t o be completed by June 1969, and i n v o l v e d c o n s t r u c t i o n of a h a r v e s t i n g v e s s e l and a d r y i n g p l a n t . A p i l o t p l a n t f o r a l g i n e x t r a c t i o n was t o be c o n s t r u c t e d and the p r o d u c t t e s t e d f o r market a c c e p t a n c e by June 1970. G i v e n s u f f i c i e n t market demand, the t h i r d phase was t o see a commercial s c a l e a l g i n e x t r a c t i o n f a c i l i t y i n p l a c e and o p e r a t i o n a l by J u l y 1971. By 1969 c a p i t a l c o n s t r u c t i o n c o s t s exceeded t w i c e the 71 o r i g i n a l e s t i m a t e s . Canada K e l p Co. L t d . (1969) c o u l d not s e c u r e $3 m i l l i o n i n promised f o r e i g n investment and D i l l i n g h a m C o r p o r a t i o n , the major c r e d i t o r , f o r c e d the company i n t o r e c e i v e r s h i p . D i l l i n g h a m c o mpleted the d r y i n g f a c i l i t y i n 1970 and c l a i m e d t o have found a s s u r e d m arkets. However, D i l l i n g h a m was u n w i l l i n g t o r i s k an a d d i t i o n a l $400,000 t o complete the h a r v e s t e r and was unable t o i n t e r e s t o u t s i d e i n v e s t m e n t . In 1972 t h e a s s e t s of the Canada K e l p Co. L t d . (1969), some $2.8 m i l l i o n , were a c q u i r e d , f o r a f r a c t i o n of c o s t , by H i -Co I n t e r n a t i o n a l L t d . ( l a t e r renamed Kelpac I n d u s t r i e s L t d . ) . Hi-Co I n t e r n a t i o n a l L t d . was a w h o l l y owned s u b s i d i a r y of E q u a t o r i a l R e sources L t d . and was i n c o r p o r a t e d t o put the Masset k e l p d r y i n g p l a n t i n t o o p e r a t i o n . Coon ( p . c ) , i n d i c a t e s t h a t K e l p a c e n t e r e d i n t o an i n t e r i m l e a s e and o p t i o n t o purchase agreement w i t h Sea-Chem I n d u s t r i e s L t d . Sea-Chem I n d u s t r i e s L t d . was t o o p e r a t e the p l a n t but t h i s agreement was t e r m i n a t e d by mutual consent and Kelpac resumed management. In 1973 K e l p a c r e c e i v e d i n d u s t r i a l a s s i s t a n c e from the f i s h e r i e s a g e n c i e s of the f e d e r a l and p r o v i n c i a l governments t o c a r r y out a s m a l l - s c a l e t e s t r u n . Between August and September 1100 tonnes of N e r e o c y s t i s were h a r v e s t e d and 32 tonnes of k e l p meal were e v e n t u a l l y produced and p r i c e d f o r s a l e a t $220/tonne (Vancouver Sun, p. 24, Oct. 12, 1973). K e l p a c e x p e c t e d t o produce up t o 2700 tonnes of k e l p meal i n the 74/75 season. In e a r l y 1975, K e l p a c f a i l e d t o s e c u r e a $112,995 A g r i c u l t u r a l and R u r a l Development Act g r a n t f o r w o r k i n g c a p i t a l t o h e l p b r i n g the Masset p l a n t i n t o p r o d u c t i o n and by December 1975, 72 E q u a t o r i a l Resources had n e g o t i a t e d a p r o f i t a b l e p r i v a t e s a l e of the p l a n t . R e p o r t e d l y , t h i s s a l e was due t o the a d v e r s e impacts of the F o r e i g n Investment and Review A c t (Vancouver Sun, p. C1, J u l y 11, 1978). A f t e r 6 y e a r s of p r i v a t e s e c t o r and f e d e r a l government a t t e m p t s t o see the Masset f a c i l i t y o p e r a t i o n a l the k e l p d r y i n g p l a n t c l o s e d and the d r i e r s were removed and s o l d . Subsequent h a r v e s t i n g and p r o c e s s i n g of seaweed i n B r i t i s h Columbia has been s p o r a d i c and s m a l l - s c a l e . In 1980, BCJ T r a d i n g Co. h a r v e s t e d and d r i e d Laminar i a and Cymathere f o r p l a n n e d e x p o r t . Between 1980-82, Langara Sea P r o d u c t s h a r v e s t e d and d r i e d s m a l l q u a n t i t i e s of P o r p h y r a f o r s a l e on the r e t a i l f ood market. No p r o f i t a b l e companies, a t t h i s t i m e , r e l y on an ann u a l h a r v e s t of seaweed as the s o l e s o u r c e of income. However, t h e r e i s c o n t i n u i n g e f f o r t on the p a r t of s e v e r a l s m a l l companies t o f i n d markets and d e v e l o p p r o d u c t s . In 1981, t h r e e development p r o p o s a l s were r e c e i v e d by the p r o v i n c i a l M a r i n e Resources Branch, B r i t i s h Columbia M i n i s t r y of Environment (now M a r i n e Resources s e c t i o n , F i s h e r i e s B r a n c h , p r o v i n c i a l M i n i s t r y of Environment) i n response t o an a d v e r t i s e m e n t f o r a p p l i c a t i o n f o r k e l p h a r v e s t i n g and p r o c e s s i n g l i c e n c e s . The M a r i n e Resources Branch and B r i t i s h Columbia M i n i s t r y of I n d u s t r y and S m a l l B u s i n e s s Development s t a f f r e v i e w e d the a p p l i c a t i o n s and s e l e c t e d Enmar Resources C o r p o r a t i o n as the most l i k e l y t o s u c c e s s f u l l y d e v e l o p the k e l p meal i n d u s t r y i n B r i t i s h Columbia. The M i n i s t e r s u b s e q u e n t l y i s s u e d a c o n d i t i o n a l guarantee of h a r v e s t i n g and p r o c e s s i n g l i c e n c e s t o t h i s company. Enmar Resources C o r p o r a t i o n was 73 awarded annua l a c c e s s t o 5000 wet weight tonnes of N e r e o c y s t i s and M a c r o c y s t i s o f f the west c o a s t of P o r c h e r I s l a n d f o r a 5 year p e r i o d . The Branch i n t e n d e d t o d i r e c t h a r v e s t e f f o r t s and mo n i t o r impacts on k e l p and a s s o c i a t e d salmon and h e r r i n g . S i n c e r e c e i v i n g k e l p h a r v e s t i n g l i c e n c e s Enmar Resources C o r p o r a t i o n has been c o n f r o n t e d w i t h an o u t s t a n d i n g F e d e r a l / P r o v i n c i a l d i s p u t e over l e g i s l a t i v e and j u r i s d i c t i o n a l c o n t r o l of the seabed and a s s o c i a t e d r e s o u r c e s between the B r i t i s h Columbia m a i n l a n d and o f f s h o r e i s l a n d s i n c l u d i n g Vancouver I s l a n d and the Queen C h a r l o t t e I s l a n d s . The P r o v i n c e has s u p p o r t e d and approved Enmar's development p l a n but the f e d e r a l government has n o t . Enmar Re s o u r c e s C o r p o r a t i o n i s u n w i l l i n g t o r i s k c a p i t a l investment u n l e s s t h e r e i s mutual a p p r o v a l of t h i s p l a n . The r e c e n t Supreme Court of Canada d e c i s i o n ( A.G. of  Canada v. A.G. of B.C. , May 17, 1984) s u p p o r t i n g B r i t i s h C olumbia's c l a i m t o the subsea r e s o u r c e s between Vancouver I s l a n d and the mainland of B r i t i s h Columbia does not a p p l y t o the r e s o u r c e s , i n c l u d i n g k e l p beds, between the Queen C h a r l o t t e I s l a n d s and the B r i t i s h Columbia m a i n l a n d . U n t i l t h e s e o w n e r s hip r i g h t s a re r e s o l v e d , e i t h e r by Co u r t r u l i n g or i n t e r -g overnmental agreement, development of the marine p l a n t i n d u s t r y i n B r i t i s h Columbia w i l l remain d i s c o u r a g e d by j u r i s d i c t i o n a l u n c e r t a i n t y . 74 2.1 C a t e g o r i z a t i o n Of F a i l u r e s A v o i d a b l e e r r o r and bad l u c k have been suggested (MRB Q u a r t e r l y R e p o r t s ) as a p p r o p r i a t e g e n e r a l c a t e g o r i e s f o r f a i l e d a t t e m p t s t o d e v e l o p the marine p l a n t i n d u s t r y . A v o i d a b l e e r r o r l i e s b e h i n d development f a i l u r e s which c o u l d have been a v o i d e d i f an a p p r o p r i a t e development s t r a t e g y had been i n p l a c e and i f a r e s o n a b l e e f f o r t had been undertaken t o g a t h e r a p p r o p r i a t e d e c i s i o n - m a k i n g i n f o r m a t i o n . For the marine p l a n t i n d u s t r y a v o i d a b l e e r r o r can be grouped under f o u r h e a d i n g s : b i o l o g i c a l i g n o r a n c e , economic n a i v e t e and f i n a n c i a l d i f f i c u l t i e s , t e c h n i c a l / m e c h a n i c a l problems, i n s t i t u t i o n a l / a d m i n i s t r a t i v e weaknesses and d e f i c i e n c i e s . The f i r s t h e a d i n g , b i o l o g i c a l i g n o r a n c e r e l a t e s t o e a r l y assumptions of u n l i m i t e d r e s o u r c e p o t e n t i a l . There was no c o n s i d e r a t i o n or comprehension of t h e s e a s o n a l changes i n q u a n t i t y and q u a l i t y of the r e s o u r c e or t h e e f f e c t s of h a r v e s t i n g s t r a t e g i e s on p l a n t r e - e s t a b l i s h m e n t and a s s o c i a t e d r e s o u r c e s . Economic n a i v e t e and f i n a n c i a l d i f f i c u l t i e s form the second h e a d i n g . Economic n a i v e t e i n c l u d e s f a i l u r e t o a d e q u a t e l y a s s e s s market c r i t e r i a . These c r i t e r i a i n c l u d e p r o d u c t s t a n d a r d s , volume and v a l u e . F i n a n c i a l d i f f i c u l t i e s have been d e m o n s t r a t e d by p r o p o s a l s t h a t were i n i t i a t e d on the b a s i s of u n s e c u r e d f u n d i n g and by d e s i g n and c o n s t r u c t i o n of o v e r - e n g i n e e r e d f a c i l i t i e s t h a t were b u i l t a t c o n s i d e r a b l e e x t r a expense. S o u r c e s of f i n a n c i a l d i f f i c u l t y can be e i t h e r endogenous, as i n t h e c a s e of Canada K e l p Co. L t d . (1948) or exogenous, as f o r 75 Canada K e l p Co. L t d . (1969). T e c h n i c a l / m e c h a n i c a l problems form a t h i r d h e a ding of a v o i d a b l e e r r o r . I n t e r - T i d a l I n d u s t r i e s L t d . p r o v i d e s an example of t e c h n i c a l d i f f i c u l t i e s a s s o c i a t e d w i t h u n t e s t e d m e c h a n i c a l systems. I n s t i t u t i o n a l / a d m i n i s t r a t i v e weaknesses and d e f i c i e n c e s a r e the f o u r t h g r o u p i n g of a v o i d a b l e e r r o r . I n s t i t u t i o n a l problems, i n the case of marine p l a n t s , a r e e x c l u s i v e t o the p u b l i c s e c t o r and i n c l u d e ambiguous l e g i s l a t i o n and redundant a d m i n i s t r a t i o n . In c o n t r a s t t o a v o i d a b l e e r r o r , bad l u c k i s the cause of development f a i l u r e s which remain u n a v o i d a b l e even g i v e n r e a s o n a b l e e f f o r t s t o reduce d e c i s i o n u n c e r t a i n t y . There i s a p o i n t beyond which a d d i t i o n a l e x p e n d i t u r e s t o reduce d e c i s i o n u n c e r t a i n t y can not be j u s t i f i e d on the b a s i s of e x p e c t e d b e n e f i t s . I f t h e s e u n c e r t a i n t i e s a r e c o n s i d e r e d and a r i s k -b e n e f i t a n a l y s i s s u g g e s t s a p r o j e c t s h o u l d p r o c e e d d i s p i t e e x t e r n a l market f a c t o r s (new s u b s t i t u t e p r o d u c t ) or r e s o u r c e f a c t o r s (the E l Nino c u r r e n t phenomenon) t h a t a r e beyond the c o n t r o l or p r e d i c t i v e power of the company, then f a i l u r e t o e s t a b l i s h the o p e r a t i o n can be excused on the b a s i s of bad l u c k . 3. LEGISLATIVE JURISDICTION AND INSTITUTIONAL ARRANGEMENTS FOR  THE MANAGEMENT OF MARINE PLANTS The purpose of t h i s s e c t i o n i s t o a d d r e s s both the j u r i s d i c t i o n a l i s s u e s around which management of the marine 76 p l a n t r e s o u r c e must pr o c e e d and t o review the F e d e r a l and P r o v i n c i a l a g e n c i e s which p r o v i d e l e a d e r s h i p i n : the development of management p o l i c i e s , a d m i n i s t r a t i o n of management p o l i c i e s and f u n d i n g of the i n d u s t r y . Development of a marine p l a n t i n d u s t r y i n B r i t i s h Columbia i n v o l v e s j u r i s d i c t i o n a l r e s p o n s i b i l i t i e s r e l a t e d t o w i l d and c u l t u r e d s o u r c e s of s u p p l y ; n a v i g a t i o n i n the v i c i n i t y of l i c e n c e d r e s o u r c e beds; maintenance of the growing environment and q u a l i t y c o n t r o l and d i s t r i b u t i o n of p r o c e s s e d p r o d u c t s . These c a t e g o r i e s w i l l be c o n s i d e r e d under s e p a r a t e h e a d i n g s . 3.1 J u r i s d i c t i o n a l I s s u e s 3.1.1 Ma r i n e P l a n t F i s h e r y Under E n g l i s h common law the r i g h t t o h a r v e s t marine p l a n t s i s the s u b j e c t of ownership as an i n c i d e n t of ownership of the l a n d u n d e r l y i n g a body of water (S . J . E . S e a l e and A.R. Thompson, 1979). When B r i t i s h Columbia e n t e r e d C o n f e d e r a t i o n i n 1871, i t r e t a i n e d ownership of p u b l i c l a n d s by v i r t u e of s. 109 of the B r i t i s h N o r t h America A c t , 1867 (BNA A c t ) . As a r e s u l t , the r i g h t t o h a r v e s t marine p l a n t s w i t h i n the b o u n d a r i e s of the p r o v i n c e belonged t o the Crown i n the r i g h t of the p r o v i n c e . T h i s c o n t i n u e s t o be the case except t o the e x t e n t t h a t the Crown i n the r i g h t of the p r o v i n c e has a l i e n a t e d t o p r i v a t e p e r s o n s the f o r e s h o r e and beds of c o a s t a l waters w i t h the 77 accompanying r i g h t t o h a r v e s t ( S . J . E . S e a l e and A.R. Thompson, 1979). The q u e s t i o n of ownership i s c o m p l i c a t e d when b o u n d a r i e s a l o n g t h e se a c o a s t a re c o n s i d e r e d . C l e a r l y , the p r o v i n c e owns the f o r e s h o r e ( A.G. v. Western H i g b i e and A l b i o n I n v e s t m e n t s , 1945 S.C.R. 385) and Canada owns the seabed from the low water mark t o the o u t e r l i m i t of the t e r r i t o r i a l s ea, so f a r as the e x p l o i t a t i o n of seabed and marine r e s o u r c e s a re concerned ( Of f- Shore M i n e r a l R e f e r e n c e , 1968, 65 D.L.R., 2d, 353, S.C.C.). Canada has j u r i s d i c t i o n as w e l l , over the 200-mile economic zone and t h e c o n t i n e n t a l s h e l f where i t extends beyond. I n l a n d waters of the p r o v i n c e f a l l i n s i d e t h e s e b o u n d a r i e s and i n c l u d e , f o r example, e s t u a r i e s , f i o r d s and bays. P r o v i n c i a l ownership and l e g i s l a t i v e a u t h o r i t y i s r e c o g n i z e d over I n l a n d waters (Dorcey, 1983). A r e c e n t Supreme. Court of Canada ( A.G. of Canada v. A.G.  of B.C; , May 17, 1984) d e c i s i o n s u p p o r t e d B r i t i s h Columbia's c l a i m t o ownership of subsea r e s o u r c e s i n the S t r a i t of G e o r g i a between Vancouver I s l a n d and the m a i n l a n d . The p r o v i n c e m a i n t a i n s t h a t t h i s d e c i s i o n s h o u l d be e x t r a p o l a t e d t o Hecate S t r a i t and the waters between the Queen C h a r l o t t e I s l a n d s and the m a i n l a n d . The l e g a l b a s i s of t h i s assumption i s not c l e a r and the j u r i s d i c t i o n f o r seabed r e s o u r c e s i n t h a t r e g i o n , i n c l u d i n g marine p l a n t s , remains u n c e r t a i n . The r i g h t t o manage marine p l a n t r e s o u r c e s i s an i n c i d e n t of o w n e r ship of the r i g h t t o h a r v e s t and l i k e any e x e r c i s e of ownership r i g h t s , i t i s s u b j e c t t o the r e q u i r e m e n t s of competent 78 l e g i s l a t i o n ( S . J . E . S e a l e and A.R. Thompson, 1979). By Head 12 of S e c t i o n 91 of the BNA A c t 1867, the P a r l i a m e n t of Canada i s g i v e n e x c l u s i v e l e g i s l a t i v e a u t h o r i t y over " s e a c o a s t and i n l a n d f i s h e r i e s " . By Head 5 of S e c t i o n 92 the Act a s s i g n s l e g i s l a t i v e j u r i s d i c t i o n over "the management and s a l e of p u b l i c l a n d s " t o the p r o v i n c i a l l e g i s l a t u r e s . S i n c e " p u b l i c l a n d s " i n c l u d e a l l o w n e r ship r i g h t s , i n c l u d i n g the r i g h t t o h a r v e s t , t h e r e i s c o n s i d e r a b l e p o t e n t i a l f o r o v e r l a p p i n g l e g i s l a t i o n . S e a l e and Thompson (1979) i n d i c a t e t h a t t h e r e i s an e x c l u s i v e ambit (scope or boundary) to be a s s i g n e d t o each of t h e s e Heads of l e g i s l a t i v e power but i n between t h e r e w i l l be an o v e r l a p p i n g f i e l d . O v e r l a p p i n g f e d e r a l and p r o v i n c i a l s t a t u t e s may o p e r a t e as c o n c u r r e n t l e g i s l a t i o n , but i f o p e r a t i o n a l c o n f l i c t s were t o o c c u r then the r u l e of paramountcy i n d i c a t e s t h a t the f e d e r a l s t a t u t e would p r e v a i l . Under Canadian c o n s t i t u t i o n a l law t h e r e must be some ambit of l e g i s l a t i v e power a s s i g n e d t o each of t h e Headings under S e c t i o n s 91 and 92 ( S . J . E . S e a l e and A.R. Thompson, 1979). T h e r e f o r e , f e d e r a l l e g i s l a t i o n cannot be a l l o w e d t o e n t i r e l y u s u r p management of marine p l a n t r e s o u r c e s . C o n f u s i o n ' w i t h b o u n d a r i e s , ownership and l e g i s l a t i v e j u r i s d i c t i o n has l e d t o a d m i n i s t r a t i v e p r a c t i c e s i n e s t a b l i s h e d c o a s t a l r e s o u r c e i n d u s t r i e s b e i n g s e t t l e d by agreements between f e d e r a l and p r o v i n c i a l a g e n c i e s w i t h p r o v i n c i a l a u t h o r i t i e s a d m i n i s t e r i n g f e d e r a l r e g u l a t i o n s . T h i s s o l u t i o n i s c o m p a t i b l e w i t h the c o n s t i t u t - i o n a l p r i n c i p l e i n Canada whereby l e g i s l a t i v e powers cannot be d e l e g a t e d between l e v e l s of government. In 79 t h i s c a s e , o n l y a d m i n i s t r a t i o n of f e d e r a l r e g u l a t i o n s i s d e l e g a t e d . The arrangement r e q u i r e s c l o s e c o - o p e r a t i o n s i n c e any changes i n r e g u l a t i o n c o n s i d e r e d n e c e s s a r y by p r o v i n c i a l a d m i n i s t r a t o r s can o n l y be made by the f e d e r a l government. An i m p o r t a n t q u a l i f i c a t i o n t o t h i s d i s c u s s i o n of r e s o u r c e ownership i n v o l v e s a c l a i m by the n a t i v e p e o p l e s of B r i t i s h Columbia of a b o r i g i n a l r i g h t s t o both f r e s h w a t e r and marine r e s o u r c e s . S h o u l d t h e s e c l a i m s be r e c o g n i z e d i n n e g o t i a t e d l a n d and r e s o u r c e s e t t l e m e n t s t h e r e would be i m p o r t a n t i m p l i c a t i o n s r e g a r d i n g f u t u r e o w n e r ship and r e g u l a t i o n of marine p l a n t r e s o u r c e s . 3.1.2 Marine P l a n t P r o d u c t s H a r v e s t s of w i l d and c u l t u r e d s t o c k s of marine p l a n t s a r e c o n s i d e r e d p e r s o n a l p r o p e r t y when taken from the water and a r e s u b j e c t t o p r o v i n c i a l l e g i s l a t i v e j u r i s d i c t i o n under " p r o p e r t y and c i v i l r i g h t s " . The B r i t i s h Columbia F i s h e r i e s A c t (R.S.B.C. 1979, c.137) p r o v i d e s f o r the l i c e n s i n g of a l l marine p l a n t p r o c e s s i n g i n d u s t r i e s i n v o l v e d w i t h domestic consumption and the F i s h I n s p e c t i o n A c t (R.S.B.C. 1979, c.136) p r o v i d e s f o r the r e g u l a t i o n of s a n i t a r y c o n d i t i o n s i n f i s h e r i e s o p e r a t i o n s and the q u a l i t y of marine p l a n t p r o d u c t s . However, P a r l i a m e n t has e x c l u s i v e j u r i s d i c t i o n t o pass l e g i s l a t i o n a f f e c t i n g i n t e r -p r o v i n c i a l and i n t e r n a t i o n a l t r a d e . The F i s h I n s p e c t i o n Act (R.S.C. 1970, c. F-12) e n a b l e s the F e d e r a l Department of 80 F i s h e r i e s and Oceans to s e t s t a n d a r d s and undertake i n s p e c t i o n f o r marine p l a n t p r o c e s s i n g o p e r a t i o n s t h a t a r e i n v o l v e d i n the p r o d u c t i o n of p r o d u c t s i n t e n d e d f o r e x p o r t . 3.1.3 N a v i g a t i o n In Canada, P a r l i a m e n t has l e g i s l a t i v e j u r i s d i c t i o n over " n a v i g a t i o n and s h i p p i n g " under S. 92(10) of the BNA A c t . T r a n s p o r t Canada a d m i n i s t e r s the N a v i g a b l e Waters P r o t e c t i o n Act (R.S.C. 1970, c. N-19) which r e q u i r e s a p p r o v a l f o r any p r o j e c t or a c t i v i t y which r e s t r i c t s the f r e e n a v i g a t i o n of a n a v i g a b l e water. W i t h i n i t s b o u n d a r i e s the p r o v i n c i a l l e g i s l a t u r e can r e g u l a t e f l o a t i n g p l a t f o r m s and t h e r e f o r e methods of marine p l a n t c u l t i v a t i o n employing f l o a t a t i o n t e c h n i q u e s . However, these a c t i v i t i e s must not i n t e r f e r w i t h n a v i g a t i o n u n l e s s they have Department of T r a n s p o r t a p p r o v a l ( S . J . E . S e a l e and A.R. Thompson, 1979). 3.1.4 Environment The f e d e r a l F i s h e r i e s Act (R.S.C. 1970, c. F-14) e n a b l e s the Department of F i s h e r i e s and Oceans (DFO) t o undertake r e s e a r c h i n t o the p o l l u t i o n of waters and the c o n s e r v a t i o n of the marine p l a n t r e s o u r c e . Most i m p o r t a n t l y , the A c t g i v e s the DFO the r i g h t and r e s p o n s i b i t y t o r e g u l a t e o t h e r w i s e 81 P r o v i n c i a l l y r e g u l a t e d a c t i v i t i e s i n s o f a r as t h e s e a c t i v i t i e s c o u l d n e g a t i v e l y impact f i s h i n g r e s o u r c e s . The A c t a l s o g i v e s the Department a u t h o r i t y t o c o n t r o l the d e p o s i t i o n of d e l e t e r i o u s s u b s t a n c e s i n t o waters i n the v i c i n i t y of marine p l a n t o p e r a t i o n s . F u r t h e r t o t h i s , the Ocean Dumping C o n t r o l Act (S.C. 1975, c.55) e n a b l e s , i n c o - o p e r a t i o n w i t h T r a n s p o r t Canada, the r e g u l a t i o n of h a r m f u l s u b s t a n c e d i s p o s a l w i t h i n Canadian t e r r i t o r i a l w a t e r s . F i n a l l y , the p r o v i n c i a l Waste Management Act (R.S.B.C. 1982, c.41) r e q u i r e s i n d u s t r i a l and government u s e r s of the f o r e s h o r e f o r waste d i s p o s a l t o o b t a i n a p e r m i t from the Crown a u t h o r i z e d manager. 3.2 F e d e r a l And P r o v i n c i a l Government A g e n c i e s The i n s t i t u t i o n a l s t r u c t u r e which a d m i n i s t e r s and p r o v i d e s i n c e n t i v e s f o r the marine p l a n t i n d u s t r y i n B r i t i s h Columbia i n c l u d e s a range of f e d e r a l and p r o v i n c i a l government departments as w e l l as p r i v a t e f i r m s and f o u n d a t i o n s . These a g e n c i e s can be c l a s s i f i e d a c c o r d i n g t o t h e i r i nvolvement w i t h the r e s o u r c e . F i r s t , p r o p r i e t a r y a g e n c i e s a r e concerned w i t h a d m i n i s t r a t i v e r e s p o n s i b i l i t i e s p e r t a i n i n g t o the ownership of marine p l a n t s and i n c l u d e the f e d e r a l Department of F i s h e r i e s and Oceans (DFO), the F i s h e r i e s Branch of the p r o v i n c i a l M i n i s t r y of Environment and the p r o v i n c i a l M i n i s t r y of Lands P a r k s and Housing. Second, r e g u l a t o r y a g e n c i e s address a d m i n i s t r a t i v e r e s p o n s i b i l i t i e s p e r t a i n i n g t o the r e g u l a t i o n of 82 marine p l a n t s or marine p l a n t i n d u s t r i a l development a c t i v i t i e s . These a g e n c i e s would i n c l u d e : DFO, B r i t i s h Columbia F i s h e r i e s B r a nch, T r a n s p o r t Canada, p r o v i n c i a l P o l l u t i o n C o n t r o l Branch and the p r o v i n c i a l M i n i s t r y of Lands, P a r k s and H o u s i n g . T h i r d , a n c i l l a r y a g e n c i e s have a d m i n i s t r a t i v e r e s p o n s i b i l i t i e s p e r t a i n i n g t o the p r o v i s i o n of a n c i l l a r y f u n c t i o n s such as r e s e a r c h , t e c h n i c a l or f i n a n c i a l s u p p o r t f o r management of the marine p l a n t r e s o u r c e . The d i s c u s s i o n t h a t f o l l o w s w i l l h i g h l i g h t the a d m i n i s t r a t i o n of the i n d u s t r y and s o u r c e s of r e s e a r c h and development i n c e n t i v e s . 3.2.1 Department Of F i s h e r i e s And Oceans (DFO) DFO has r e s p o n s i b i l i t y f o r the a d m i n i s t r a t i o n of f e d e r a l l e g i s l a t i o n i n c l u d i n g : the F i s h e r i e s A c t , the F i s h I n s p e c t i o n A c t , the F i s h e r i e s Development A c t , the C o a s t a l F i s h e r i e s P r o t e c t i o n A c t (R.S.C. 1970, c. C-21) and the F i s h e r i e s and Oceans R e s e a r c h A d v i s o r y C o u n c i l A c t (S.C. 1979, c . 1 3 ) . , The f e d e r a l F i s h e r i e s A c t a u t h o r i z e s the B.C. F i s h e r i e s R e g u l a t i o n s which a r e a d m i n i s t e r e d , i n p a r t , by the F i s h e r i e s Branch of the p r o v i n c i a l M i n i s t r y of Environment. In t u r n , the B.C. F i s h e r i e s R e g u l a t i o n s s e t the terms and c o n d i t i o n s f o r marine p l a n t h a r v e s t i n g and p r o c e s s i n g i n B r i t i s h C o l u m b i a . S e c t i o n s 33, 33.1 and 33.2 of the f e d e r a l F i s h e r i e s A c t a l s o p r o v i d e f o r p r o t e c t i o n of f i s h h a b i t a t and p o l l u t i o n p r e v e n t i o n i n the marine environment. 83 The F i s h e r i e s R e s e a r c h Branch of DFO has been a s o u r c e of r e s e a r c h funds f o r a g u a c u l t u r e p r o j e c t s i n B.C. Under the F i s h e r i e s Development Program, a d m i n i s t e r e d by the F i s h e r i e s Development D i v i s i o n of DFO, f o r example, A r c h i p e l a g o M a r i n e Research r e c e i v e d support t o conduct a s m a l l p r o j e c t on h e r r i n g spawn-on-kelp ( E n v i r o c o n , 1984). F i s h e r i e s improvement l o a n s , a d m i n i s t e r e d by DFO, a r e d e s i g n e d t o i n c r e a s e the a v a i l a b i l i t y of c r e d i t t o marine p l a n t h a r v e s t e r s f o r a v a r i e t y of p r o j e c t s . To encourage l e n d e r s t o make thes e l o a n s , the f e d e r a l government i s a u t h o r i z e d t o guarantee l e n d e r s a g a i n s t l o s s i n c u r r e d on l o a n s . In B r i t i s h Columbia the DFO has not assumed the p r i n c i p l e l e a d e r s h i p r o l e i n management of the marine p l a n t r e s o u r c e or i n development of a marine p l a n t i n d u s t r y . However, l e g i s l a t i v e c o n t r o l and i n t e r p r e t a t i o n of f e d e r a l r e g u l a t i o n s remains a f e d e r a l r e s p o n s i b i l i t y and t h e r e f o r e an impediment t o i m p l i m e n t a t i o n of p r o v i n c i a l management o b j e c t i v e s . At t h i s t i m e . the DFO i s d r a f t i n g , i n c o - o p e r a t i o n w i t h p r o v i n c i a l a g e n c i e s , a g e n e r a l f i s h e r i e s agreement t o be s i g n e d by the Government of Canada and the P r o v i n c e of B r i t i s h C olumbia. T h i s agreement w i l l i n c l u d e annexes f o r both the West Coast marine p l a n t r e s o u r c e and any o p p o r t u n i t i e s f o r marine p l a n t a q u a c u l t u r e . 84 3.2.2 F i s h e r i e s Branch ( P r o v i n c i a l M i n i s t r y Of The Environment) In 1946, the P r o v i n c i a l government amended the p r o v i n c i a l F i s h e r i e s A c t and promulgated r e g u l a t i o n s ; by v i r t u e of t h i s l e g i s l a t i o n the P r o v i n c e assumed c o n t r o l over the marine p l a n t r e s o u r c e base and i n d u s t r y . The r e g u l a t i o n s were i n response t o s e v e r a l companies e x p r e s s i n g i n t e r e s t i n e s t a b l i s h i n g a marine p l a n t i n d u s t r y i n B r i t i s h Columbia and p r o v i d e d f o r l o n g - t e r m l e a s e s of d e s i r a b l e marine p l a n t a r e a s . To encourage development of h a r v e s t i n g a r e a s a p o l i c y of i s s u i n g 21-year l i c e n c e s w i t h annual review was adopted. In 1973, t h i s p o l i c y was reviewed and the Branch revoked a l l l i c e n c e s t o unused a r e a s and d e v e l o p e d a s p e c i e s approach t o l i c e n s i n g . Assuming the r o l e of l e a d agency a t t h i s t i m e , the Commercial F i s h e r i e s Branch p l a n n e d t o p r o v i d e a s s i s t a n c e and guidance t o the d e v e l o p e r s of a marine p l a n t i n d u s t r y and t o e s t a b l i s h s a f e g u a r d s f o r development of the r e s o u r c e . In a n t i c i p a t i o n of more seaweed h a r v e s t i n g o p e r a t i o n s on the P a c i f i c c o a s t s t u d i e s were i n i t i a t e d t o e v a l u a t e the e f f e c t s of h a r v e s t i n g on the r e g e n e r a t i o n of p l a n t s i n o r d e r t h a t a p p r o p r i a t e management r e g u l a t i o n s c o u l d be implemented by the p r o v i n c i a l government. The s t u d i e s were i n i t i a t e d by the Branch i n c o n j u n c t i o n w i t h the U n i v e r s i t y of V i c t o r i a and were j o i n t l y f i n a n c e d by i n d u s t r y and the F e d e r a l and P r o v i n c i a l f i s h e r y a g e n c i e s (MRB Quarter-l-y-Reports). In 1973, a f t e r r e - o r g a n i z a t i o n of the Department of R e c r e a t i o n and C o n s e r v a t i o n the r e s p o n s i b i l i t y f o r marine p l a n t 85 management and i n d u s t r i a l development f e l l t o the M a r i n e P l a n t S e c t i o n , Marine Resources B r a n c h , p r o v i n c i a l M i n i s t r y of the Environment. In 1984, a f t e r r e - o r g a n i z a t i o n w i t h i n the Environment M i n i s t r y , r e s p o n s i b i l i t y f o r marine p l a n t management was g i v e n t o the Marine Resources S e c t i o n , F i s h e r i e s Branch. L e g i s l a t i v e a u t h o r i t y t o manage marine p l a n t r e s o u r c e s and r e g u l a t e the h a r v e s t i n g and p r o c e s s i n g s e c t o r s of the i n d u s t r y a r e c o n f e r r e d on the F i s h e r i e s Branch by S e c t i o n 24 of the B r i t i s h Columbia F i s h e r i e s A c t . P r e s e n t p r o v i n c i a l seaweed h a r v e s t i n g r e g u l a t i o n s a r e g i v e n i n P a r t I I of B r i t i s h Columbia R e g u l a t i o n 140/76. They g i v e r e s o u r c e managers c o n t r o l over t h e q u a n t i t i e s of each s p e c i e s which may be h a r v e s t e d i n any d e f i n e d a r e a , the manner i n which h a r v e s t i n g may be conducted and the type of h a r v e s t i n g a p p a r a t u s t h a t may be employed. H a r v e s t i n g can be o r d e r e d suspended a t any time e i t h e r f o r c o n s e r v a t i o n of the s p e c i e s b e i n g h a r v e s t e d or c o n s e r v a t i o n of a s s o c i a t e d f l o r a or f a u n a . H a r v e s t i n g l i c e n c e s a r e now i s s u e d based upon s i m i l a r b i o l o g i c a l groups and/or on the b a s i s of t h e i r i n d u s t r i a l p r o d u c t p o t e n t i a l . A marine p l a n t p r o c e s s i n g l i c e n c e i s a l s o r e q u i r e d by f i r m s p r o d u c i n g seaweed-based p r o d u c t s , i n c l u d i n g t h o s e u s i n g i m p o r t e d , s e m i - r e f i n e d seaweed m a t e r i a l . F e d e r a l P a c i f i c Coast M a r i n e P l a n t R e g u l a t i o n s were adopted i n 1978 and amended i n 1980. They r e f e r t o the r e q u i r e m e n t of a l i c e n c e f o r h a r v e s t i n g and i d e n t i f y g e n e r a l r e s t r i c t i o n s a p p l y i n g t o a l l l i c e n c e d h a r v e s t e r s . The F i s h e r i e s Branch has s t a t e d a p o l i c y t o match th e s c a l e 86 of r e s o u r c e u t i l i z a t i o n t o the Branches management c a p a b i l i t y . F u r t h e r , the Branch embraces the concept of optimum s u s t a i n e d y i e l d as the b a s i s f o r management of marine p l a n t r e s o u r c e s i n B r i t i s h Columbia (Coon, u n p u b l i s h e d r e p o r t 1983). However, o p t i m a l y i e l d i s c o n d i t i o n a l s i n c e h a r v e s t s must not exceed the l e v e l of maximum s u s t a i n a b l e y i e l d . Here maximum s u s t a i n a b l e y i e l d r e f e r s t o a p o i n t c o n s t r a i n e d s o l e l y by b i o l o g i c a l c r i t e r i a . Optimum s u s t a i n a b l e y i e l d i s d e f i n e d by a d d i t i o n a l c o n s t r a i n t s such as h a r v e s t i n g c o s t / r e v e n u e c u r v e s . The Marine Resources S e c t i o n has unde r t a k e n development of both a marine p l a n t management s t r a t e g y and an i n d u s t r i a l development s t r a t e g y . The marine p l a n t management s t r a t e g y a t t e m p t s t o d e v e l o p a b a s i c u n d e r s t a n d i n g of "the b i o l o g y and e c o l o g i c a l i n t e r a c t i o n s of each r e s o u r c e s p e c i e s . T h i s b a s i c u n d e r s t a n d i n g i s used t o d e v e l o p a p r e l i m i n a r y p l a n or model used f o r managing commercial h a r v e s t i n g . The g o a l of the i n d u s t r i a l development s t r a t e g y i s t o d e r i v e maximum economic and s o c i a l b e n e f i t from the marine p l a n t r e s o u r c e s of B r i t i s h C olumbia. T h i s g o a l i s approached by both u t i l i z a t i o n of w i l d s t o c k s and by development of marine p l a n t m a r i c u l t u r e . The s t a t e d o b j e c t i v e s f o r u t i l i z a t i o n of w i l d s t o c k s a r e t o dete r m i n e o p t i m a l s u s t a i n a b l e y i e l d , on a s p e c i e s b a s i s , and t o f a c i l i t a t e i n d u s t r i a l u t i l i z a t i o n t o the a p p r o p r i a t e l e v e l . The o b j e c t i v e s of marine p l a n t m a r i c u l t u r e a r e : t o broaden the p o t e n t i a l i n d u s t r i a l " base; t o i n c r e a s e s t o c k s t o a l e v e l a t which p r i m a r y and/or secondary p r o c e s s i n g i s e c o n o m i c a l l y f e a s i b l e ; and t h i r d , t o d e v e l o p new investment 87 and employment o p p o r t u n i t i e s f o r c o a s t a l communities. The M arine Resources s e c t i o n has f o r m u l a t e d a s t r a t e g y f o r d e v e l o p i n g the k e l p meal and a l g i n a t e i n d u s t r i e s on the Canadian west c o a s t . The f o l l o w i n g o u t l i n e p r o v i d e s the s t r a t e g y f o r development of the k e l p i n d u s t r y (Coon, 1983). 1. P r o v i d e a s i n g l e l i c e n c e and a l l o c a t e enough raw m a t e r i a l (maximum of 5000 tonnes) t o s a t i s f y the market demand f o r k e l p meal. 2. Manage the h a r v e s t o p e r a t i o n f o r a 5-year p e r i o d i n such a way t h a t the s u s t a i n a b l e y i e l d of k e l p and the h a b i t a t needs of a s s o c i a t e d f i s h e r y s p e c i e s can be d e t e r m i n e d . 3. M o d i f y the k e l p management p l a n a t y e a r - 5 , i f n e c e s s a r y . 4. D i v i d e the c o a s t i n t o two major p l a n t r e s o u r c e p o o l s . 5. I n i t i a t e an a l g i n e x t r a c t i o n i n d u s t r y by o f f e r r i n g a s i n g l e l i c e n c e and an annua l h a r v e s t quota of 20,000-50,000 wet tonnes i n one of the r e s o u r c e p o o l s . 6. M o n i t o r the impacts of h a r v e s t i n g on k e l p r e c r u i t m e n t and f i s h e r y r e s o u r c e s i n the l a r g e r h a r v e s t a r e a . 7. M o d i f y the k e l p management p l a n , i f n e c e s s a r y . 8. O f f e r a second l i c e n c e t o p e r m i t a second a l g i n a t e e n t e r p r i s e t o o p e r a t e i n the r e m a i n i n g r e s o u r c e p o o l . 9. M o n i t o r k e l p s t o c k s and i n d u s t r i a l o p e r a t i o n s c o a s t w i d e t o update i n p u t t o the management model and t o ensure c o m p l i a n c e w i t h l i c e n c e c o n d i t i o n s . Development of a l a r g e - s c a l e w i l d s t o c k s u p p l i e d k e l p i n d u s t r y must be p r e d i c a t e d by i t s e f f e c t s on f i s h e r y r e s o u r c e s (Coon, 1977; 1983) and t h r e e s c e n a r i o s have been suggested (Coon, 1983). F i r s t , i f a s u s t a i n e d h a r v e s t i n g s t r a t e g y y i e l d s no s i g n i f i c a n t n e g a t i v e impacts on a s s o c i a t e d f i s h e r y r e s o u r c e s 88 then the i n d u s t r y w i l l be p e r m i t t e d t o d e v e l o p t o i t s f u l l p o t e n t i a l . Second, i f n e g a t i v e impacts can be a t t r i b u t e d t o l a r g e - s c a l e k e l p h a r v e s t i n g and the c o s t s i n c u r r e d by a s s o c i a t e d f i s h e r i e s a r e g r e a t e r than the b e n e f i t s a r i s i n g from the k e l p i n d u s t r y then development of the k e l p i n d u s t r y w i l l be r e s t r i c t e d u n t i l the c o s t s can be m i t i g a t e d . F i n a l l y , i f the c o s t s cannot be reduced t o an a c c e p t a b l e l e v e l then the j u s t i f i c a t i o n f o r a k e l p i n d u s t r y w i l l be r e - c o n s i d e r e d . 3.2.3 M i n i s t r y Of Lands, P a r k s And Housing Under the Land Act (R.S.B.C. 1979, c. 214) t h e M i n i s t r y of Lands, P a r k s and Housing i s empowered t o a d m i n i s t e r a l l a s p e c t s of the d i s p o s i t i o n of Crown l a n d , i n c l u d i n g f o r e s h o r e and seabed a r e a s , whether by s a l e , l e a s e or l i c e n c e of o c c u p a t i o n . The Land Act a l s o e n a b l e s e s t a b l i s h m e n t of r e s e r v e s on Crown l a n d s ( S . J . E . S e a l e and A.R. Thompson, 1979). On August 22, 1983 a new p o l i c y f o r a q u a c u l t u r e use, i n c l u d i n g marine p l a n t a q u a c u l t u r e , on a q u a t i c Crown l a n d was approved. The broad p o l i c y o b j e c t i v e s i n c l u d e p r o v i d i n g s e c u r e l o n g - t e r m t e n u r e and e n s u r i n g d i l i g e n t use of a q u a c u l t u r e t e n u r e s . The F i s h e r i e s Branch i s r e s p o n s i b l e f o r the management p l a n s r e q u i r e d f o r l e a s e and l i c e n c e t e n u r e s . The p r i m a r y form of t e n u r e i s a l e a s e but a l i c e n c e of o c c u p a t i o n may be i s s u e d where s h o r t - t e r m t e n u r e i s r e q u i r e d . A l e a s e p r o v i d e s g r e a t e r s e c u r i t y and a g r e a t e r degree of 89 e x c l u s i v e use than a l i c e n c e of o c c u p a t i o n . The term of t e n u r e i s a s t a n d a r d twenty y e a r s f o r a l e a s e and t e n y e a r s f o r a l i c e n c e of o c c u p a t i o n . The i n i t i a l l e a s e , however, i.s f o r a t e n year term t o a l l o w assessment of the d i l i g e n t use of new t e n u r e s b e f o r e o f f e r i n g t h e l o n g e r s t a n d a r d term. Renewal can be a p p l i e d f o r a t the mid-term of the t e n u r e . 3.2.4 Other R e g u l a t o r y A g e n c i e s In a d d i t i o n t o the r e g u l a t o r y r e s p o n s i b i l i t i e s of DFO and the F i s h e r i e s Branch two a d d i t i o n a l government a g e n c i e s p a r t i c i p a t e i n r e g u l a t i o n of the marine p l a n t i n d u s t r y . They i n c l u d e : T r a n s p o r t Canada and the p r o v i n c i a l P o l l u t i o n C o n t r o l B ranch. T r a n s p o r t Canada a d m i n i s t e r s the N a v i g a b l e Waters P r o t e c t i o n A c t and the Canada S h i p p i n g Act (R.S.C. 1970, c. S-9 ) . Common law r e c o g n i z e s a p u b l i c r i g h t of n a v i g a t i o n which p r e v a i l s o v er th e r i g h t s of the owner of the seabed or the r i g h t s of t h e r i p a r i a n owner. However, under the N a v i g a b l e Waters P r o t e c t i o n A c t the p u b l i c r i g h t of n a v i g a t i o n may now be r e s t r i c t e d by p e r m i t . S e a l e and Thompson (1979) i n d i c a t e t h a t the M i n i s t e r of T r a n s p o r t may waive the need f o r a p e r m i t i f he f e e l s the p r o j e c t does not s u b s t a n t i a l l y i n t e r f e r e w i t h n a v i g a t i o n . The Waste Management Act a u t h o r i z e s the p r o v i n c i a l M i n i s t e r of Environment t o p l a y a r e g u l a t o r y r o l e i n p r o t e c t i o n of the 90 marine p l a n t growing environment. The Waste Management Act e n a b l e s the d e t e r m i n a t i o n and enforcement of s t a n d a r d s f o r a l l t y p e s of p o l l u t i o n a f f e c t i n g the f o r e s h o r e , i n c l u d i n g e f f l u e n t d i s c h a r g e from marine p l a n t p r o c e s s i n g p l a n t s . The A c t r e q u i r e s a p e r m i t f o r waste d i s p o s a l i n the f o r e s h o r e . 3.2.5 A n c i l l a r y A g e n c i e s I n c l u d i n g P r i v a t e Companies And  F o u n d a t i o n s A n c i l l a r y a g e n c i e s p r o v i d e f u n c t i o n s such as r e s e a r c h , t e c h n i c a l and/or f i n a n c i a l support f o r management of the marine p l a n t r e s o u r c e . F e d e r a l l y , t h e s e f u n c t i o n s a r e p r o v i d e d by programmes a d m i n i s t e r e d by the Department of R e g i o n a l and I n d u s t r i a l Expansion (DRIE), the N a t u r a l S c i e n c e s and E n g i n e e r i n g Research C o u n c i l of Canada, the N a t i o n a l R e s e a r c h C o u n c i l , Crown C o r p o r a t i o n s i n c l u d i n g the F e d e r a l B u s i n e s s Development Bank and the E x p o r t Development C o r p o r a t i o n and f i n a l l y , by the Department of I n d i a n and N o r t h e r n A f f a i r s . P r o v i n c i a l l y , the M a r i n e Resources S e c t i o n funded s e v e r a l p r e l i m i n a r y s t u d i e s r e l a t e d t o the marine p l a n t r e s o u r c e . F unding i s c u r r e n t l y a v a i l a b l e t h r o u g h the S c i e n c e C o u n c i l of B r i t i s h C o lumbia, the M i n i s t r y of I n d u s t r y and S m a l l B u s i n e s s . •: Development, the M i n i s t r y of A g r i c u l t u r e and Food and a l s o t h r o u g h the B r i t i s h Columbia Development C o r p o r a t i o n . F i n a l l y , G e n e r a l M i l l s Canada L t d . , the Campbell Soup Company, the Vancouver F o u n d a t i o n , the Hamber F o u n d a t i o n and the Max B e l l 91 F o u n d a t i o n have each p r o v i d e d f i n a n c i a l s u p p o r t f o r a g u a c u l t u r e endeavours and r e s e a r c h p r o j e c t s . 4. KEY INDUSTRIAL OPPORTUNITIES AND CONSTRAINTS I n t e r n a t i o n a l markets f o r seaweed p r o d u c t s suggest t h a t the marine p l a n t i n d u s t r y w i l l be c o n s t r a i n e d as an economic f o r c e i n B r i t i s h C olumbia. However, development of the marine p l a n t r e s o u r c e does have the p o t e n t i a l t o p r o v i d e g a i n f u l employment f o r a l i m i t e d number of p a r t i c i p a n t s . The d i s c u s s i o n of the b i o l o g y of the s i x commercial s p e c i e s of marine p l a n t s i n B r i t i s h Columbia h i g h l i g h t e d t h r e e p o i n t s . F i r s t , t h a t t h i s i s a renewable r e s o u r c e ; second, t h a t i t i s a c r i t i c a l component of a complex eco-system; and t h i r d , t h a t t e c h n i q u e s have been dev e l o p e d f o r the c u l t u r e of t h e s e s p e c i e s . These p o i n t s a r e a d d r e s s e d i n c u r r e n t p u b l i c p o l i c y and a r e r e f l e c t e d i n s t a t e d g o a l s and o b j e c t i v e s . Absent however, i s an a c t i v e p o l i c y t o p r e s e r v e those r e g i o n s of the c o a s t l i n e t h a t have been i n v e n t o r i e d and i d e n t i f i e d as p r o v i d i n g the n e c e s s a r y growing c o n d i t i o n s f o r the e s t a b l i s h m e n t and development of marine p l a n t s . T h i s p o l i c y c o u l d d e r i v e from a b a r g a i n i n g p r o c e s s i n v o l v i n g o t h e r c o a s t a l r e s o u r c e u s e r s and r e p r e s e n t a t i v e s of the marine p l a n t i n d u s t r y . The c o n c l u d i n g c h a p t e r w i l l a d d r e s s t h i s o p p o r t u n i t y . The d i s c u s s i o n of the economics of p r o d u c t i o n i n B r i t i s h Columbia i d e n t i f i e d t h r e e f a c t o r s l i m i t i n g the economic 92 v i a b i l i t y of f i r m s : one, the need by f i r m s f o r f i n a n c i a l a s s i s t a n c e ; two, assessment and a c c e s s of f i r m s t o markets; and t h r e e , c o m p e t i t i o n w i t h e s t a b l i s h e d f i r m s . The f i r s t two f a c t o r s a r e a d d r e s s e d by subsequent government i n c e n t i v e programs. The t e s t of adequacy of the s e programs, however, must aw a i t b o t h i m p l e m e n t a t i o n and, t h e n , assessment by f i r m s o p e r a t i n g i n the marine p l a n t i n d u s t r y . The t h i r d l i m i t i n g economic f a c t o r i n v o l v e s c o m p e t i t i o n w i t h e s t a b l i s h e d f i r m s . In a d d i t i o n t o i n c e n t i v e programs, c a r e f u l c o n s i d e r a t i o n must be g i v e n t o the b a l a n c e between a b u r e a u c r a t i c push v e r s u s a market p u l l f o r development of the marine p l a n t i n d u s t r y . Any b u s i n e s s v e n t u r e r e q u i r e s b oth r i s k t a k i n g and i n i t i a t i v e on the p a r t of the promoter. P r e s e n t p u b l i c i n c e n t i v e s by the M i n i s t r y of I n d u s t r y and S m a l l B u s i n e s s Development and DRIE, f o r example, a r e i n t e n d e d t o reduce the r i s k f a c t o r w h i l e a l l o w i n g a market p u l l t o induce p r i v a t e s e c t o r r e s ponse. To d a t e , t h i s response has been d i s a p p o i n t i n g . E x p l a n a t i o n s p r o v i d e d by i n d u s t r y i n c l u d e : the p e r c e i v e d inadequacy of the s e i n c e n t i v e s by p r i v a t e i n d u s t r y ; and/or the r e l u c t a n c e by i n d u s t r y t o i n v e s t i n an i n d u s t r y w i t h an u n c e r t a i n r e g u l a t o r y environment due t o l a c k of a d e f i n e d l e a d agency or government r e p r e s e n t a t i v e . The r e view of i n s t i t u t i o n s i n v o l v e d i n the management of the marine p l a n t i n d u s t r y h i g h l i g h t s the need f o r a c o - o r d i n a t e d management e f f o r t . T h i s c o u l d be i n the form of a l e a d agency w i t h a d m i n i s t r a t i v e a u t h o r i t y or a p r o c e s s which f a c i l i t a t e s a mediated management consensus. One r o l e of marine p l a n t 93 management i s t o determine the k i n d and s i z e of investment t o make i n development of the r e s o u r c e . Through a s e r i e s of r e a c t i v e i n i t i a t i v e s the MRB has a t t e m p t e d t o assume t h i s r o l e . At t h i s t i m e , the F i s h e r i e s Branch c o n t i n u e s t o support a combined p r o t e c t i o n and development s t r a t e g y t h a t i s l o o s e l y based on s t r a t e g i c p l a n n i n g . From the broader s t r a t e g i c p l a n n i n g p e r s p e c t i v e , Branch s t r a t e g y appears t o be l a c k i n g i n s e v e r a l ways: f i r s t , a mechanism f o r p r o t e c t i o n of the r e s o u r c e environment; second, a means t o a d e q u a t e l y r e f l e c t the i n t e r e s t s of a l l r e s o u r c e u s e r s ; and t h i r d , a p r o c e d u r e t o ensure i m p l e m e n t a t i o n of any adopted s t r a t e g i e s . DFO has been u n i n t e r e s t e d , u n t i l r e c e n t l y , i n a d d r e s s i n g a s t r a t e g y f o r development and has been c o n t e n t t o s t a l l development by e x p r e s s i n g c o n c e r n s over the p r o t e c t i o n of a s s o c i a t e d r e s o u r c e s and r e p r e s e n t a t i o n of n a t i v e i n t e r e s t s . C l e a r l y , the F i s h e r i e s Branch and DFO r e p r e s e n t d i f f e r e n t i n t e r e s t s i n t h i s r e g a r d . A l o n g - t e r m s o l u t i o n t o t h i s impasse w i l l e i t h e r come th r o u g h a n e g o t i a t e d e x t r a - j u d i c i a l s e t t l e m e n t or t h r o ugh a Court r u l i n g . 5. PRIORITIES FOR THE DEVELOPMENT OF MARINE PLANT RESOURCES IN  BRITISH COLUMBIA — T h i s r e v i e w h i g h l i g h t s f o u r c a t e g o r i e s of f a i l u r e which appear t o a p p l y t o p r e v i o u s a t t e m p t s t o d e v e l o p the marine p l a n t i n d u s t r y i n B r i t i s h C o lumbia. These c a t e g o r i e s i n c l u d e : 94 b i o l o g i c a l i g n o r a n c e , economic n a i v e t e and f i n a n c i a l d i f f i c u l t i e s , t e c h n i c a l / m e c h a n i c a l problems and i n s t i t u t i o n a l / a d m i n i s t r a t i v e weaknesses and d e f i c i e n c i e s . S e v e r a l of t h e s e c a t e g o r i e s have s i n c e been remedied i n p a r t or i n whole as the f o l l o w i n g d i s c u s s i o n i n d i c a t e s . There remains, however, t h r e e p r i o r i t i e s f o r the development of marine p l a n t r e s o u r c e s i n B r i t i s h C olumbia. W h i l e bad l u c k has been d e f i n e d i n S e c t i o n 2.1 and s uggested as a p o s s i b l e s o u r c e of f a i l u r e , t h e r e i s no e v i d e n c e t o suggest t h a t i t a p p l i e s t o any of the f a i l e d a t t e m p t s r e v i e w e d i n the h i s t o r i c a l o v e r v i e w . I n t e r e s t i n g l y , as e a r l y as 1967 ( G r e e n i u s ) the need had been i d e n t i f i e d f o r i n f o r m a t i o n i n the f o l l o w i n g a r e a s : the e x t e n t and d e n s i t y of the seaweed beds and the amount of p h y s i c a l l y h a r v e s t a b l e seaweed; the market f o r and market a c c e p t a b i l i t y of a l g i n a t e s from B.C. p l a n t s ; the s u i t a b i l i t y of m e c h a n i c a l h a r v e s t e r s t o h a r v e s t e f f i c i e n t l y under West Coast c o n d i t i o n s ; s t o r a b i l i t y of c u t seaweed f o r y e a r - r o u n d p r o c e s s i n g of summer h a r v e s t ; and the e f f e c t of h a r v e s t i n g on marine e c o l o g y . I t was not u n t i l 1970 however, t h a t the Commercial F i s h e r i e s Branch ( l a t e r t h e M a rine Resources Branch) r e c o g n i z e d t h a t e s t a b l i s h m e n t of a major marine p l a n t i n d u s t r y i n B r i t i s h Columbia was p l a g u e d by e i t h e r a v o i d a b l e e r r o r s or bad l u c k or both (MRB Q u a r t e r l y R e p o r t s ) . At t h i s t i m e , s t u d i e s were 95 i n i t i a t e d t o e v a l u a t e t h e e f f e c t s of h a r v e s t i n g on the r e g e n e r a t i o n of p l a n t s i n o r d e r t h a t the p r o v i n c i a l government c o u l d implement a p p r o p r i a t e management r e g u l a t i o n s . R e w r i t t e n seaweed h a r v e s t i n g r e g u l a t i o n s appeared i n 1976. By 1974 a management o b j e c t i v e was i n p l a c e t o guide r e s e a r c h e f f o r t s f o r a l l s p e c i e s of c o m m e r c i a l l y v a l u a b l e marine p l a n t s : "... t o d e v e l o p , through c r i t i c a l l y p l a n n e d , e x e c u t e d and e v a l u a t e d r e s e a r c h programs, an i n f o r m a t i o n base s u f f i c i e n t i n b r e a d t h and scope t o p e r m i t and c o n t r o l the commercial h a r v e s t of a g i v e n s p e c i e s on a maximum s u s t a i n e d y i e l d b a s i s . " (MRB Q u a r t e r l y R e p o r t ) The o b j e c t i v e was t o be reached by phased program p l a n n i n g u s i n g the f o l l o w i n g g e n e r a l o u t l i n e : 1. study the b i o c h e m i c a l make-up and how i t v a r i e s s e a s o n a l l y and g e o g r a p h i c a l l y ; 2. i n v e n t o r i e s of a v a i l a b l e s t o c k s ; 3. s t u d i e s of growth and r e p r o d u c t i v e c y c l e s and the e f f e c t of e x p e r i m e n t a l h a r v e s t i n g ; 4. s t u d i e s of the impacts of l a r g e - s c a l e h a r v e s t i n g on a s s o c i a t e d p l a n t and animal s p e c i e s ; and 5. where a p p l i c a b l e , development of c u l t i v a t i o n and enhancement t e c h n o l o g i e s . C l e a r l y , these p u b l i c i n i t i a t i v e s were i n response t o the r e c o g n i z e d l a c k of a v a i l a b l e b i o l o g i c a l i n f o r m a t i o n n e c e s s a r y f o r e f f e c t i v e marine p l a n t management. In 1977, a survey of l o c a l markets f o r e d i b l e seaweed 96 p r o d u c t s and a second l a r g e r assessment of n a t i o n a l and i n t e r n a t i o n a l markets f o r seaweed p r o d u c t s were i n i t i a t e d . I t was then r e c o g n i z e d t h a t l o n g - t e r m p l a n n i n g f o r b oth seaweed r e s o u r c e management and i n d u s t r i a l p u r p o s e s had s u f f e r e d due t o a l a c k of i n f o r m a t i o n p e r t a i n i n g t o t h e key economic f a c t o r s which c o n t r o l the e n t r y of i n d u s t r y i n t o such a r e s o u r c e f i e l d . Company f i n a n c i n g c o n c e r n s , however, remained the r e s p o n s i b i l i t y of i n d i v i d u a l f i r m s . J u r i s d i c t i o n a l i s s u e s have been i d e n t i f i e d as l e a d i n g t o the u n s a t i s f a c t o r y performance of t h e marine p l a n t i n d u s t r y i n B r i t i s h Columbia. The u n r e s o l v e d d i s p u t e over o w n ership of the seabed between the m a i n l a n d and t h e Queen C h a r l o t t e I s l a n d s remains a major o b s t a c l e t o i n d u s t r i a l development r e l y i n g on the h a r v e s t of w i l d s t o c k s of g i a n t k e l p . I f d i s p u t e d o w n e r ship was the o n l y i s s u e i n t h i s f e d e r a l / p r o v i n c i a l c o n f l i c t then a n e g o t i a t e d agreement c o u l d be e x p e c t e d as w i t h o y s t e r r e s o u r c e s ( S e a l e and Thompson, 1979). However, the emerging demands of n a t i v e groups appear t o c o m p l i c a t e t h i s o p p o r t u n i t y . Three p r i o r i t i e s f o r the development of marine p l a n t r e s o u r c e s i n B r i t i s h Columbia emerge from t h i s r e v i e w of i n d u s t r i a l o p p o r t u n i t i e s and c o n s t r a i n t s . The f i r s t c o n c e r n s h a b i t a t p r e s e r v a t i o n . In o r d e r t o m a i n t a i n the o p t i o n f o r marine p l a n t based i n d u s t r i a l development t h e r e i s a need t o r e s e r v e c r i t i c a l r e s o u r c e beds, at t h i s t i m e , t o p r e v e n t f u r t h e r encroachment of u n s ympathetic a c t i v i t i e s i n these a r e a s . A second p r i o r i t y i s t o p r o v i d e a p r o c e s s which p e r m i t s the i n t e r e s t s of a l l r e s o u r c e u s e r s t o be e x p r e s s e d and t h r o u g h a 97 b a r g a i n i n g p r o c e s s t o be r e f l e c t e d i n a r e s u l t a n t s t r a t e g y . The f i n a l p r i o r i t y f o c u s e s a t t e n t i o n on the need f o r an i m p l e m e n t a t i o n p r o c e s s . The c o n c l u d i n g c h a p t e r a d d r e s s e s t h e s e p r i o r i t i e s and s u g g e s t s the components of a s t r a t e g i c management and development p l a n t o a c h i e v e the o b j e c t i v e s of marine p l a n t i n d u s t r i a l development i n B r i t i s h C o lumbia. 98 V. COMPONENTS TO A STRATEGIC PLAN FOR THE MANAGEMENT AND DEVELOPMENT OF A MARINE PLANT INDUSTRY IN BRITISH COLUMBIA 1. INTRODUCTION D e s p i t e n e a r l y 40 y e a r s of t r o u b l e d and s p o r a d i c a t t e m p t s t o e s t a b l i s h a West Coast marine p l a n t i n d u s t r y , government and i n d u s t r y r e p r e s e n t a t i v e s s t i l l e x p r e s s i n t e r e s t i n d e v e l o p i n g the r e s o u r c e p o t e n t i a l of marine p l a n t s . On one hand, we are f a c e d w i t h what appears t o be a c o m m e r c i a l l y e x p l o i t a b l e , renewable marine r e s o u r c e , w h i l e on the o t h e r hand, each attempt t o d e v e l o p the r e s o u r c e has so f a r ended i n f a i l u r e . G i v e n the rev i e w of p a s t performance an argument w i l l be made i n t h i s c h a p t e r t h a t i f a s t r a t e g i c p l a n i s i n p l a c e f o r the management and development of the marine p l a n t i n d u s t r y i n B r i t i s h Columbia b e f o r e f u r t h e r development i s i n i t i a t e d then b o t h the p u b l i c and p r i v a t e s e c t o r s c o u l d b e n e f i t . T h i s argument w i l l f u r t h e r suggest t h a t i n view of the o p p o r t u n i t i e s and c o n s t r a i n t s i d e n t i f i e d i n Chapter IV and g i v e n the assump t i o n t h a t i n Canada, p u b l i c p o l i c i e s a r e e x p e c t e d t o a s p i r e t o the p r i n c i p l e s of a l i b e r a l d e m o c r a t i c s o c i e t y , then s t r a t e g i c p l a n n i n g i s an a p p r o p r i a t e p r o c e s s t o f a c i l i t a t e the development and management of marine p l a n t r e s o u r c e s . The r e s u l t s , g i v e n today's economics of p r o d u c t i o n and m a r k e t i n g , s h o u l d p r o v i d e i n f o r m a t i o n t h a t i s c r i t i c a l t o d e c i s i o n s 99 a f f e c t i n g the f u t u r e u t i l i z a t i o n of West Coast marine p l a n t r e s o u r c e s . P r e v i o u s l y d i s c u s s e d b i o l o g i c a l and economic c r i t e r i a l i m i t t h i s d i s c u s s i o n t o two p r o d u c t s , kelp-meal and r o e - o n - k e l p . 2. RATIONALE FOR A STRATEGIC PLANNING PROCESS BASED ON  ASPIRATIONS TO LIBERAL DEMOCRATIC PRINCIPLES The b a s i c g o a l of good government has been d e s c r i b e d as s e e k i n g t o advance the good of the people ( B a r k e r , 1958) and t o t h i s end we must c o n s i d e r how changes t o p u b l i c w e l f a r e a r e measured w i t h i n a d e m o c r a t i c system. T h i s i s the purpose of e v a l u a t i o n . E v a l u a t i o n methods.are p e r v a s i v e i n the p l a n n i n g p r o c e s s and as components of a d e m o c r a t i c p o l i t i c a l system they s h o u l d be c o m p a t i b l e w i t h the v a l u e s of the system. Given the commonly h e l d b e l i e f of Canadian s o c i e t y t h a t the p r o c e s s of d e c i s i o n making and p o l i c y f o r m a t i o n must be seen t o a s p i r e t o " l i b e r a l d e m o c r a t i c p r i n c i p l e s . " These p r i n c i p l e s a d d r e s s the p r o c e s s by which d e c i s i o n s h a v i n g s o c i a l consequences s h o u l d be made. Three .basic c o n c e p t s r e l a t e t o these p r i n c i p l e s (Fox, E y r e , M a i r ; 1983). One i d e n t i f i e s c e r t a i n i n a l i e n a b l e r i g h t s of the i n d i v i d u a l t h a t a r e e n s h r i n e d i n the Canadian C o n s t i t u t i o n ' s C h a r t e r of R i g h t s . A second concept i s the b e l i e f t h a t s o c i e t y must ensure f a i r t r e a t m e n t of groups and i n d i v i d u a l s and t h i r d , the p r e f e r e n c e s and p r i o r i t i e s of a l l i n d i v i d u a l s a f f e c t e d by 100 p u b l i c a c t i o n s have e q u a l v a l u e i n government d e c i s i o n s . There i s no t e c h n i c a l b a s i s f o r d e t e r m i n i n g what c o n s t i t u t e s a b e s t p l a n s i n c e no b a s i s e x i s t s f o r measuring the v a r i o u s impacts i n s i m i l a r terms. S o c i e t y ' s e v a l u a t i o n i s t h e r e f o r e the r e s u l t of a p r o c e s s i n which i n d i v i d u a l e v a l u a t i o n s a r e b a l a n c e d a g a i n s t one a n o ther by b a r g a i n i n g and i f n e c e s s a r y , by government m e d i a t i o n . Assuming a p o t e n t i a l f o r c o n f l i c t between the d e v e l o p i n g marine p l a n t i n d u s t r y and o t h e r c o a s t a l r e s o u r c e u s e r s , i n c l u d i n g the e c o n o m i c a l l y s i g n i f i c a n t and h i s t o r i c a l l y e s t a b l i s h e d west c o a s t f i s h i n g and f o r e s t i n d u s t r i e s , over a c c e s s t o those a r e a s of the c o a s t a l zone which i n c l u d e marine p l a n t beds of commercial s i g n i f i c a n c e , then a p r o v i s i o n f o r t h i s b a r g a i n i n g p r o c e s s seems a p p r o p r i a t e . Management p l a n s r e q u i r e a s e t of p o l i c i e s and p o l i c y i n s t r u m e n t s f o r t h e i r i m p l e m e n t a t i o n . S t r a t e g i c p l a n n i n g i n the r e s o u r c e s e c t o r has e v o l v e d t o respond t o f o u r g e n e r a l c r i t i c i s m s d i r e c t e d a t p a s t management p l a n s (O'Riordan, 1983). These c r i t i c i s m s a r e : f i r s t , t h a t new d a t a has o f t e n been c o l l e c t e d b e f o r e t o p i c a l i s s u e s and management o b j e c t i v e s have been i d e n t i f i e d ; second, t h a t t y p i c a l l y , f o r e c a s t i n g p r o j e c t i o n s a r e based o n l y on e x t r a p o l a t i o n s from p a s t t r e n d s ; t h i r d , t h a t s t u d i e s have tended t o be a d m i n i s t r a t i v e l y cumbersome; and f o u r t h , t h a t i m p l e m e n t a t i o n of study recommendations r a r e l y o c c u r s s i n c e t h i s p a r t of the p l a n n i n g p r o c e s s i s not b u i l t i n t o t h e b u d g e t i n g and p o l i c y - m a k i n g s t r u c t u r e of each p a r t i c i p a t i n g agency. As a consequence of t h e s e c r i t i c i s m s a s t r a t e g i c p l a n n i n g 101 p r o c e s s e m p h a s i z i n g t h r e e p o i n t s has been advanced (O'Riordan, 1983): f i r s t , t o i n t e g r a t e a l l components of an a g e n c i e s mandate i n an e f f o r t t o d e v e l o p a c o n s i s t e n t s e t of p r i o r i t i e s and p o l i c i e s ; second, t o use e x i s t i n g d a t a t o d e v e l o p an i n i t i a l p l a n w i t h i n a s h o r t time frame. Data gaps a r e p r i o r i z e d i n the c o n t e x t of s p e c i f i c management i s s u e s and i n f o r m a t i o n i s g a t h e r e d as p a r t of the management programme. T h i r d , the p r o c e s s seeks a d i r e c t l i n k a g e w i t h an a g e n c i e s b u d g e t i n g p r o c e s s t o ensure t h a t manpower and r e s o u r c e s a r e committed f o r implementing p r i o r i t y management measures. S t r a t e g i c p l a n n i n g has been i d e n t i f i e d as a c o s t - e f f e c t i v e management t o o l f o r the marine p l a n t i n d u s t r y (Dorcey, 1979; d i s c u s s i o n paper, 1980). T h i s p l a n n i n g p r o c e s s a t t e m p t s t o r e s o l v e c o n f l i c t i n g demands f o r l i m i t e d r e s o u r c e s and i n v o l v e s s t r a t e g i e s t h a t r e c o g n i z e u n c e r t a i n t y and can adapt i n l i g h t of new i n f o r m a t i o n . A s t r a t e g i c p l a n f o r management of marine p l a n t s can p r o v i d e an e s s e n t i a l u n d e r s t a n d i n g of how g o a l s can be a c h i e v e d through a number of s t r a t e g i c d e c i s i o n s . The s t r a t e g i c p l a n s h o u l d be d e s i g n e d t o a d d r e s s s p e c i f i c problems and o p p o r t u n i t i e s ; t o b e n e f i t from o p p o r t u n i t i e s i n the p r e s e n t ; and t o a p p l y e v o l v i n g i n f o r m a t i o n t o i m p r o v i n g management i n the f u t u r e . S t r a t e g i c p l a n n i n g produces two c l o s e l y r e l a t e d s e t s of management p o l i c i e s . The f i r s t i s a development s t r a t e g y and the second i s a p r o t e c t i o n s t r a t e g y . Both s t r a t e g i e s c o n s i s t o f : f i r s t , a s t r a t e g i c p l a n w i t h a n a l y s i s of o b j e c t i v e s and p o l i c i e s f o r a t t a i n i n g o b j e c t i v e s ; and second, p r o c e d u r e s f o r 102 r e v i s i n g the s t r a t e g i c p l a n . S t r a t e g i c p l a n n i n g p r o v i d e s a means t o t i e the g o a l s and o b j e c t i v e s of r e s o u r c e management t o the l e g i s l a t i o n , p o l i c i e s and p o l i c y i n s t r u m e n t s used t o a c h i e v e them. P o l i c y a n a l y s i s i s d i v i d e d i n t o a p r o c e s s component and a s u b s t a n t i v e component (Dorcey, 1979). P r o c e s s a d d r e s s e s the who, what, how and when of marine p l a n t management. Who s h o u l d do the p l a n n i n g and management? What s h o u l d the l e a d agency be doing? How t o implement t h i s type of management? When s h o u l d the p l a n n i n g and management s t r a t e g y be put i n t o p r a c t i c e ? These q u e s t i o n s a r e both e s s e n t i a l and c r i t i c a l i f the o p p o r t u n i t y t o d e v e l o p a marine p l a n t i n d u s t r y i n B r i t i s h Columbia i s t o be s u c c e s s f u l l y e x p l o i t e d . The s u b s t a n t i v e component of p o l i c y a n a l y s i s r e f e r s t o the o u t p u t of the p r o c e s s . 3. MODIFICATIONS TO COMPLY WITH STRATEGIC PLANNING The p r o v i n c i a l F i s h e r i e s Branch has a p r e l i m i n a r y management and development p l a n which i s remarkably s i m i l a r t o the s t r a t e g i c p l a n j u s t o u t l i n e d . Any management p l a n must c o n s i d e r e n v i r o n m e n t a l r e q u i r e m e n t s and i n s t i t u t i o n a l arrangements i f i t i s t o succeed. The F i s h e r i e s Branch p l a n approaches t h i s s t a t e but appears t o have inadequate p r o v i s i o n s i n the f o l l o w i n g t h r e e a r e a s : f i r s t , f o r marine p l a n t h a b i t a t p r o t e c t i o n ; second, i n r e p r e s e n t a t i o n and m e d i a t i o n f o r i n t e r e s t 103 groups; and t h i r d , f o r a mechanism t o implement any i d e n t i f i e d s t r a t e g i e s . P r o t e c t i o n of the marine p l a n t h a b i t a t i s an o b v i o u s requirement a t t h i s time i f the o p t i o n t o d e v e l o p the i n d u s t r y i s t o be m a i n t a i n e d . D u r i n g the i n i t i a l s t a g e s of development n e i t h e r the r o e - o n - k e l p nor the k e l p meal s e c t o r s a r e l i k e l y t o be c o n s t r a i n e d by l i m i t e d h a b i t a t . However, e x p a n s i o n of t h e s e s e c t o r s or d i v e r s i f i c a t i o n of the i n d u s t r y i n t o new s e c t o r s which a r e c u r r e n t l y m a r g i n a l may be c o n s t r a i n e d by developments l i k e log-booming a c t i v i t i e s or o t h e r h a b i t a t use c o n f l i c t s . I d e n t i f i c a t i o n and p r o t e c t i o n of c r i t i c a l h a b i t a t a r e a s a t t h i s time and/or development of o p t i o n s which m i n i m i z e the p o t e n t i a l f o r c o n f l i c t ( l i k e e n c o u r a g i n g i n d u s t r i a l development i n remote a r e a s ) are c l e a r l y s t r a t e g i e s which m a i n t a i n the o p t i o n t o d e v e l o p the i n d u s t r y w h i l e m i n i m i z i n g t h e , p o t e n t i a l f o r p o s s i b l e r e s o u r c e use c o n f l i c t s . The p r o v i s i o n f o r adequate r e p r e s e n t a t i o n of i n t e r e s t s and m e d i a t i o n between p a r t i c i p a t i n g i n t e r e s t groups has c l e a r l y been d e f i c i e n t from the F i s h e r i e s Branch p l a n . The s t a l e m a t e d s i t u a t i o n i n v o l v i n g Enmar Resources C o r p o r a t i o n , t h e F e d e r a l and P r o v i n c i a l governments and n a t i v e i n t e r e s t s i l l u s t r a t e s t h i s p o i n t . J u s t i f i c a t i o n f o r a mechanism t o p r o v i d e i n p u t and r e p r e s e n t a t i o n of l e g i t i m a t e i n t e r e s t s and t o p r o v i d e a p r o c e s s t o a l l o w a mediated agreement f o l l o w s from " l i b e r a l d e m o c r a t i c p r i n c i p l e s . " A p r a g m a t i c consequence of the s t r a t e g i c p l a n n i n g p r o c e s s i s the need f o r an i m p l e m e n t a t i o n mechanism. By d e f i n i t i o n , i t 1 04 i s a c o n d i t i o n of any s t r a t e g i c p l a n t o p r o v i d e f o r m a l c o n t a c t w i t h an a g e n c i e s b u d g e t i n g p r o c e s s t o ensure the n e c e s s a r y manpower and r e s o u r c e s f o r implementing management measures. T h i s f o r m a l i z e d c o n t a c t i s absent from the F i s h e r i e s Branch's i n i t i a l development p l a n . 4. IMPLEMENTATION CONSIDERATIONS 4.1 Who Shoul d Do The P l a n n i n g And Management? In a d d i t i o n t o i n d u s t r y i t has been d e m o n s t r a t e d t h a t many government a g e n c i e s have an i n t e r e s t i n t h e p l a n n i n g and management of the marine p l a n t i n d u s t r y . At t h i s time the p r o v i n c i a l M a r i n e Resources S e c t i o n , p r o v i n c i a l F i s h e r i e s Branch has the major i n t e r e s t i n the i n d u s t r y . However, as Dorcey (1979) noted f o r the o y s t e r i n d u s t r y , the Branch i s c r i t i c a l l y dependent on and a f f e c t e d by o t h e r government a g e n c i e s . R e s p o n s i b i l i t i e s f o r b i o l o g i c a l m o n i t o r i n g , c o n s e r v a t i o n of growing a r e a s , f i n a n c i a l a s s i s t a n c e , l e a s e and l i c e n c e i s s u a n c e and the l o c a t i o n of p r o c e s s i n g f a c i l i t i e s a r e fragmented between many government b o d i e s . T h i s f r a g m e n t a t i o n of r e s p o n s i b i l i t i e s makes i t i m p o r t a n t to have c l e a r l y o u t l i n e d p r o c e d u r e s f o r c o - o r d i n a t i n g the a c t i v i t i e s of i n d i v i d u a l s , i n d u s t r y and government. I t has been p o i n t e d out ( S e a l e and Thompson, 1979) t h a t s i m i l a r 105 f r a g m e n t a t i o n has been a major weakness i n the o y s t e r i n d u s t r y i n B r i t i s h C o lumbia. Some f o r m a l i z e d body must assume r e s p o n s i b i l i t y f o r t h i s c o - o r d i n a t i n g e f f o r t and i n the case of the marine p l a n t i n d u s t r y t h i s agency must have the a u t h o r i t y of b o th s e n i o r l e v e l s of government. At t h i s time l i k e l y c a n d i d a t e s f o r the r o l e of c o - o r d i n a t i n g body i n c l u d e the p r o v i n c i a l F i s h e r i e s Branch or t h e f e d e r a l Department of F i s h e r i e s and Oceans. 4.2 What S h o u l d The C o - o r d i n a t i n g Body Be Doing? The c o - o r d i n a t i n g body s h o u l d i n v o l v e i t s e l f i n s t r a t e g i c p l a n n i n g t o f i n e tune both an i n d u s t r i a l development s t r a t e g y and a r e s o u r c e p r o t e c t i o n s t r a t e g y . T h i s management s t r a t e g y must i n v o l v e t h r e e f e a t u r e s . F i r s t , an i n i t i a l development p l a n f o r the two i d e n t i f i e d , v i a b l e marine p l a n t p r o d u c t s which would i n c l u d e : a d e f i n i t i o n of g o a l s and o b j e c t i v e s of marine p l a n t management i n c l u d i n g r e s e a r c h , r e g u l a t i o n and enforcement; an o u t l i n e of p o l i c i e s t o a c h i e v e t h e s e r e s o u r c e management g o a l s ; and p r o c e d u r e s f o r s t r a t e g i z i n g i n response t o u n c e r t a i n t i e s a s s o c i a t e d w i t h marine p l a n t management. G o a l s f o r d e v e l o p i n g the marine p l a n t i n d u s t r y have been suggested i n v a r i o u s forms ( C r u t c h f i e l d , 1965; MRB 1977) and o b j e c t i v e s f o r managing marine p l a n t r e s o u r c e s can be d e r i v e d from s t u d i e s o r i g i n a l l y d i r e c t e d a t a c o a s t a l f i s h e r y ( L a r k i n , 1979; 1980). In g e n e r a l terms, t h e s e g o a l s and o b j e c t i v e s 1 06 a ddress r e s e a r c h , r e g u l a t i o n and enforcement. In p r a c t i c a l terms, government a g e n c i e s , i n d u s t r y and academic i n s t i t u t i o n s have a p p l i e d t h i s framework t o the marine p l a n t case and completed an i n i t i a l stage of r e s o u r c e r e s e a r c h and r e g u l a t i o n . At t h i s t i m e , i n i t i a l p l a n s f o r development and p r o t e c t i o n of the marine p l a n t r e s o u r c e s h o u l d be d r a f t e d . The second f e a t u r e of t h i s management s t r a t e g y i s an assessment of the impact of o t h e r c o a s t a l zone developments on the marine p l a n t i n d u s t r y . At t h i s time i t i s p o s s i b l e t o i n v e n t o r y s i g n i f i c a n t growing a r e a s a s s o c i a t e d w i t h the i d e n t i f i e d commercial marine p l a n t s p e c i e s . C o a s t a l developments which pose a p o t e n t i a l t h r e a t t o t h e s e a r e a s must be a n t i c i p a t e d by any management s t r a t e g y and t h e i r a f f e c t s m i t i g a t e d or a v o i d e d a b s o l u t e l y . The c o - o r d i n a t i n g body s h o u l d i d e n t i f y and m o n i t o r these developments and c o n t r i b u t e t o a b a r g a i n i n g p r o c e s s between i n t e r e s t s a f f e c t e d by the r e s o u r c e a c t i v i t i e s i n c o n f l i c t . Impact assessment p r o c e d u r e s must a s s e s s the s o c i a l , e n v i r o n m e n t a l and economic impacts of o t h e r r e s o u r c e development a c t i v i t i e s i n terms of t h e i r e f f e c t on the development p l a n f o r marine p l a n t p r o d u c t s . F i n a l l y , the management s t r a t e g y must p r o v i d e f o r r e s e a r c h . T h i s study has i d e n t i f i e d k e l p meal and r o e - o n - k e l p as v i a b l e p r o d u c t s a t t h i s t i m e . However, as the i n d u s t r y d e v e l o p s and a management i n f r a - s t r u c t u r e i s e s t a b l i s h e d the o p p o r t u n i t y t o expand or d i v e r s i f y the i n d u s t r y may a r i s e . For example, r e s e a r c h d i r e c t e d a t p r o d u c t and market development f o r kombu and n o r i d e r i v e d p r o d u c t s may i d e n t i f y o p p o r t u n i t i e s f o r f u t u r e 1 07 d i v e r s i f i c a t i o n . T h i s s c e n a r i o s h o u l d be encouraged by a management s t r a t e g y t h a t p r o v i d e s f o r r e s e a r c h . 4.3 How To Implement The S t r a t e g i c P l a n ? T h i s t ype of management r e q u i r e s both p u b l i c and p r i v a t e involvement w i t h a d e t e r m i n e d commitment from both i f the apparent p o t e n t i a l of the marine p l a n t i n d u s t r y i s t o be r e a l i z e d . D e s p i t e the i n f o r m a t i o n t h a t i s not a v a i l a b l e a t t h i s t i m e , i t i s p o s s i b l e t o d r a f t a p r e l i m i n a r y development p l a n f o r marine p l a n t management as r e q u i r e d by the s t r a t e g i c p l a n n i n g p r o c e s s . In the s h o r t - t e r m , e f f o r t s a re r e q u i r e d t o r e s o l v e c o n t i n u i n g c o n f l i c t i n g c l a i m s of e x c l u s i v e r e s o u r c e ownership and c o n t i n g e n t management r e s p o n s i b i l i t y . In t h e mid-term, i t may become n e c e s s a r y t o ensure t h a t e f f o r t s towards development of a marine p l a n t i n d u s t r y a r e not c a n c e l l e d by developments i n competing s e c t o r s , l i k e t he c o a s t a l f o r e s t i n d u s t r y . In the lo n g - t e r m , i t may become a p p r o p r i a t e t o r e v i s e the development p l a n t o a d d r e s s o p p o r t u n i t i e s f o r i n d u s t r i a l e x p a n s i o n and d i v e r s i f i c a t i o n . For the marine p l a n t i n d u s t r y t h i s development p l a n must c o n s i d e r : f i r s t , a p r o c e d u r e f o r d i s c u s s i o n and m e d i a t i o n between groups c l a i m i n g an i n t e r e s t i n the r e s o u r c e based on ownership c l a i m s , r e s o u r c e management a b i l i t i e s or e n t r e p r e n e u r i a l s k i l l s ; s e c o n d , p r i o r i t i e s f o r r e s e a r c h and reassessment t o s t r e n g t h e n t h e i n i t i a l p l a n ; and t h i r d , p o l i c i e s 1 08 f o r i t s i m p l e m e n t a t i o n i n c l u d i n g arrangements w i t h i n v o l v e d government a g e n c i e s f o r t h e i r p a r t i c i p a t i o n i n the i m p l e m e n t a t i o n p r o c e s s . T h i s p l a n would be p r e s e n t e d t o i n d u s t r y , government a g e n c i e s and the p u b l i c f o r d i s c u s s i o n . F o l l o w i n g d i s c u s s i o n the p l a n would be amended and adopted f o r implementat i o n . 4.4 When Shoul d These E f f o r t s Begin? I n d u s t r y , government and t h i s study c o n f i r m t h a t an o p p o r t u n i t y c u r r e n t l y e x i s t s f o r development of a marine p l a n t i n d u s t r y i n B r i t i s h C olumbia. As a consequence, i t i s p a r t i c u l a r i l y i m p o r t a n t t h a t a management s t r a t e g y of the type o u t l i n e d be implemented as soon as p o s s i b l e . The f a i l u r e of the B r i t i s h Columbia o y s t e r i n d u s t r y t o a c h i e v e i t s f u l l p o t e n t i a l i s i n d i c a t i v e of the l i k e l y outcome of a f l e d g l i n g marine p l a n t i n d u s t r y i n the absence of a s t r a t e g i c p l a n f o r development and p r o t e c t i o n . 109 BIBLIOGRAPHY 1. 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