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The U.S. Department of Commerce strongly supports the National Offshore Aquaculture Act of 2007 and its purported promise for the nation’s economy. The department manages marine resources through the National Oceanic and Atmospheric Administration and promotes new technology through the National Institute of Standards and Technology.

“Seafood contributes over $8 billion to the United States’ trade deficit. America imports 80 percent of its seafood and almost half of that is from aquaculture. A robust offshore aquaculture industry will help reverse this and will help drive economic growth,” ¹ said Secretary of Commerce Carlos Gutierrez in April 2007. However, while the federal government has spent millions of dollars funding offshore aquaculture research and demonstration projects on both U.S. coasts and in Hawaii and Puerto Rico, the commercial viability of the fledgling industry has yet to be proven.

The National Offshore Aquaculture Act, H.R. 2010 and S. 1609, would allow companies to place fish farming cages in federal waters, three to 200 miles from shore. However, this type of aquaculture, called “offshore” or “open ocean” aquaculture, barely has been achieved on a small scale and, in most cases, with significant government support.

Randy Cates, president of the Hawaiian aquaculture company Cates International, admits that a significant investment of government funds would be needed to subsidize the development of an offshore aquaculture industry in the United States. “It will not make sense to pass [the National Offshore Aquaculture Act] unless we are willing to invest in this new industry,” Cates said. “I strongly believe that we will need a level of around $50 million per year to adequately satisfy needs on a national level.” ²

Although current demonstration projects are sited in state waters, up to three miles from shore, the government has presented them as models of eventual operations in the federal waters farther from shore.

Hawaii Projects

Hawaii hosts two operations in its waters. Cates International, born out of the Department of Commerce-funded Hawaii Offshore Aquaculture Research Program, raises Pacific threadfin, also called moi, in four cages two miles off the coast of Oahu. Cates produces 750 tons of fish annually, but hopes to acquire another ocean lease and build a hatchery to scale up to 7,000 tons per year.³

The second aquaculture venture, Kona Blue Water Farms, produces amberjack, sold as Kona Kampachi^®. The operation, which registered $2 million in sales in 2006, distributes to Whole Foods supermarkets and seafood restaurants on the U.S. West coast.^{4, 5} Kona Blue plans to add 14 cages to the existing six that are moored a half mile off the coast of Kona Island.⁶

Both the Department of Commerce’s NOAA and NIST agencies granted money to support offshore aquaculture in the state of Hawaii:

NOAA National Marine Aquaculture Initiative Grants

Sources: “Recipients of the 2006 NOAA National Marine Aquaculture Initiative Grants.” National Oceanic and Atmospheric Administration, September 2006; McVey, Eileen M. Personal email correspondence. Aquaculture Librarian, NOAA Central Library, June 1, 2007.

NOAA Small Business Innovation Research Program Grants

Sources: “Awards for Fiscal Year 2004.” Office of Research and Technology Applications, National Oceanic and Atmospheric Administration; “Awards for Fiscal Year 2003.” Office of Research and Technology Applications, National Oceanic and Atmospheric Administration.

National Institute of Standards and Technology Advanced Technology Program Grant

Sources: “Overcoming an Impediment to Marine Fish Hatchery Culture: Zooplankton Harvesting and Mesocosm Culture.” Advanced Technology Program, National Institute of Standards and Technology

NOAA Saltonstall-Kennedy Grants

Sources: Grable, Michael. “The Saltonstall-Kennedy Grant Program: Fisheries Research and Development. Report 2002.” Financial Services Division, National Oceanic and Atmospheric Administration, Aug. 1, 2002; “The Saltonstall-Kennedy Grant Program: Fisheries Research and Development. Report 1998.” Financial Services Division, National Oceanic and Atmospheric Administration, Aug. 1, 1998.

From 1998 to 2007, Kona Blue or its parent company, Black Pearls, Inc., received nearly $1.8 million and Cates received about $150,000 in grants from the Department of Commerce. The department also granted nearly $1.3 million for collaborative research in support of offshore aquaculture in Hawaii.

Florida/Puerto Rico Project

Two miles off Culebra, Puerto Rico, Snapperfarm, Inc. raises cobia in collaboration with researchers from the University of Miami and the University of Puerto Rico. The operation produces only 50 tons of fish per year in three cages, but hopes to increase production and acquire permits to add five more cages.^8,9

However, University of Miami scientist Daniel Benetti admits that “low survival rates due to disease outbreaks both at the hatchery and at the growout stages are currently causing severe economic impact and compromising the commercial viability of the operations.” ¹⁰

The following Department of Commerce grants were used to support offshore aquaculture in the Caribbean:

NOAA National Marine Aquaculture Initiative Grants

Sources: “Recipients of the 2006 NOAA National Marine Aquaculture Initiative Grants.” National Oceanic and Atmospheric Administration, September 2006; McVey, Eileen M. Personal email correspondence. Aquaculture Librarian, NOAA Central Library, June 1, 2007; McVey, Eileen M. Personal email correspondence. Aquaculture Librarian, NOAA Central Library, July 25, 2007; McVey, Eileen M. Personal email correspondence. Aquaculture Librarian, NOAA Central Library, June 1, 2007.

NOAA Small Business Innovation Research Program Grants

Sources: “Awards for Fiscal Year 2005.” Office of Research and Technology Applications, National Oceanic and Atmospheric Administration.

NOAA Saltonstall-Kennedy Grants

Source: Grable, Michael. “The Saltonstall-Kennedy Grant Program: Fisheries Research and Development. Report 2002.” Financial Services Division, National Oceanic and Atmospheric Administration, Aug. 1, 2002.

The following Department of Agriculture appropriations did not specify whether the grants were offered to support offshore aquaculture research in Florida:

U.S. Department of Agriculture Appropriations

Sources: H.R. 255, 109th Cong. (2006); H.R. 792, 108th Cong. (2005); H.R. 275, 107th Cong. (2002); H.R. 948, 106th Cong. (2001).

From 1999-2007, Snapperfarm, Inc. directly received close to $60,000 from the Department of Commerce for offshore aquaculture. Researchers also received close to $2.3 million in support of open ocean aquaculture in the Caribbean. Additionally, Congress appropriated more than $1.8 million of USDA funds for general aquaculture research in Florida.

New Hampshire/ New England Project

Richard Langan, director of the University of New Hampshire’s Atlantic Marine Aquaculture Center, has high hopes for offshore aquaculture. “Certainly the potential is in the many millions of dollars…,” ¹¹ Langan said.

However, for the years 1997-2006, UNH sold only about 6,500 pounds of fish raised in offshore cages, totaling $23,711, despite receiving hundreds of thousands of dollars in government subsidies. In 2005 and 2006, the center made 11 sales of cod and 1 sale of cod guts to five Northeastern companies. Despite UNH’s statement to NOAA that “halibut, haddock and cod –– all of which have been raised from offshore cages –– have excellent potential for commercial development,” ¹² the center had not sold any halibut or haddock as of 2006, according to UNH invoices obtained by Food & Water Watch through a public records request. Although UNH’s program is not a commercial operation, these figures indicate that in the 10 years since it was founded, the program has not demonstrated that open ocean aquaculture is commercially viable.

The New Hampshire hatchery, Great Bay Aquaculture, provides UNH and Snapperfarm with juvenile fish for offshore aquaculture. The company also plans to raise cod in cages off the Maine coast. George Nardi, head of Great Bay, echoes Cates’ request for more funding: “We need $50 million, not $5 million.” ¹³

The following Department of Commerce grants were used to support offshore aquaculture in New England:

NOAA National Marine Aquaculture Initiative Grant

Sources: “Recipients of the 2006 NOAA National Marine Aquaculture Initiative Grants.” National Oceanic and Atmospheric Administration, September 2006; “National Strategic Initiative Project Summaries 2001.” Aquaculture Information Center, National Oceanic and Atmospheric Administration; McVey, Eileen M. Personal email correspondence. Aquaculture Librarian, NOAA Central Library, July 25, 2007.

NOAA Small Business Innovation Research Program Grants

Sources: “Awards for Fiscal Year 2005.” Office of Research and Technology Applications, National Oceanic and Atmospheric Administration; “Awards for Fiscal Year 2004.” Office of Research and Technology Applications, National Oceanic and Atmospheric Administration; “Awards for Fiscal Year 2003.” Office of Research and Technology Applications, National Oceanic and Atmospheric Administration.

NOAA Saltonstall-Kennedy Grants

Sources: Grable, Michael. “The Saltonstall-Kennedy Grant Program: Fisheries Research and Development. Report 2005.” Financial Services Division, National Oceanic and Atmospheric Administration, Aug. 1, 2005; Grable, Michael. “The Saltonstall-Kennedy Grant Program: Fisheries Research and Development. Report 2004.” Financial Services Division, National Oceanic and Atmospheric Administration, Aug. 1, 2004; “The Saltonstall-Kennedy Grant Program: Fisheries Research and Development. Report 2000.” Financial Services Division, National Oceanic and Atmospheric Administration, Aug. 1, 2000; “The Saltonstall-Kennedy Grant Program: Fisheries Research and Development. Report 1999.” Financial Services Division, National Oceanic and Atmospheric Administration, Aug. 1, 1999.

From 1999 to 2007, Great Bay Aquaculture received nearly $250,000 from the Department of Commerce for open ocean aquaculture research. The agency granted more than $1.7 million for collaborative research in support of offshore aquaculture in New England.

California/Mexico Project

Hubbs–Sea World began trying to establish an open ocean aquaculture operation in 1998, when it received a NOAA grant to raise white sea bass offshore. However, at this time, Hubbs raises sea bass in near–shore net–pens.¹⁶ In 2006, Hubbs received a grant from NOAA to grow yellowtail amberjack in collaboration with a Mexican company in a popular tuna aquaculture site off the coast of Baja California, Mexico.

The following Department of Commerce grant supports Hubbs-Sea World’s offshore aquaculture research:

NOAA National Marine Aquaculture Initiative Grant

Source: “Recipients of the 2006 NOAA National Marine Aquaculture Initiative Grants.” National Oceanic and Atmospheric Administration, September 2006.

NOAA Saltonstall-Kennedy Grants

Source: “The Saltonstall-Kennedy Grant Program: Fisheries Research and Development. Report 1998.” Financial Services Division, National Oceanic and Atmospheric Administration, Aug. 1, 1998.

Hubbs-Sea World may or may not have used the following Department of Agriculture grant to support its offshore aquaculture research, as the precise project for this grant is not specified:

U.S. Department of Agriculture Appropriations

Source: H.R. 255, 109th Cong. (2006).

From 1998 to 2007, Hubbs-Sea World Research Institute received more than $700,000 from the Department of Commerce for open ocean aquaculture research.

Gulf of Mexico Projects

The Gulf Marine Institute of Technology owns an oil rig complex in Texas state waters and plans to attach offshore aquaculture cages to the rig, where they would raise cobia in cooperation with the University of Texas and Texas A&M University.¹⁸

The Gulf of Mexico Offshore Aquaculture Consortium proposed to raise fish adjacent to a Chevron natural gas platform, but it abandoned the project when funding expired in 2003.

The following Department of Commerce grants were used to support offshore aquaculture research in the Gulf of Mexico:

NOAA National Marine Aquaculture Initiative Grants

Source: McVey, Eileen M. Personal email correspondence. Aquaculture Librarian, NOAA Central Library, June 1, 2007.

NOAA Saltonstall-Kennedy Grants

Source: “The Saltonstall-Kennedy Grant Program: Fisheries Research and Development. Report 2000.” Financial Services Division, National Oceanic and Atmospheric Administration, Aug. 1, 2000.

Earmarks in Senate 2008 Commerce Appropriations Bill

Source: Ellis, Steve. “Alabama big winner in FY08 Senate Commerce, Justice, Science, & Related Agencies Spending Bill.” Taxpayers for Common Sense, July 9, 2007.

From 1999 to 2002, the Department of Commerce granted more than $300,000 for collaborative research in support of offshore aquaculture in the Gulf of Mexico.

Conclusion

The Department of Commerce has made the past decade of offshore aquaculture development possible through millions of dollars in subsidies. Since 1999, the department has granted close to $3 million to companies involved with offshore aquaculture and funded nearly $9.3 million in offshore aquaculture research. However, despite this investment of taxpayer funds, existing offshore aquaculture operations have not proven that their industry is commercially viable, or that it will balance the nation’s seafood trade deficit.