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Seafood by-products: offshoots create opportunity.

Seafood By-Products: Offshoots Create Opportunity

Far out on the frigid and often-times hostile Bering Sea, another net full of bottomfish is hoisted aboard the stern ramp of a factory trawler. It's a scene repeated each day by the dozens of huge commercial fishing and processing ships that ply these waters in the state's newest and most lucrative non-oil industry.

The large trawlers and smaller land-based vessels that deliver bottomfish to onshore processors harvest pollock, Pacific cod, rockfish and flounder. A nearly $1 billion a year industry, the bottomfish industry's prime benefactors are Alaska and Washington. In 1989, more than two million metric tons of bottomfish, mostly pollock, were scooped from the briny depths of the North Pacific and turned into fillets, patties and fish sticks. Some 140,000 tons of pollock ended up as surimi, an imitation seafood that serves as ingredient in a host of other edibles.

Shoreside processors and factory trawlers are locked in a head-to-head battle over allocation of bottomfish. But on one issue they agree: They waste an incredible amount of the resource.

Last year, factory trawlers and shoreside bottomfish processors tossed away nearly one billion pounds of undersized bottomfish, edible meat, heads, viscera, and other parts left over after the more valuable portions were removed. Only about 30 percent of an average pollock or cod contains usable meat. The rest is ground up and dumped back into the sea.

Stopping the squandermania is a battle as much to do with ethics as economics in an industry that pumps millions of dollars each year into the economies of Alaska (where the shoreside processors operate) and Washington state (where most of the factory trawlers come from). Federal laws, public opposition to ocean pollution caused by rotting fish waste, and a moral obligation to use as much of the resource as possible has catalyzed the industry to find new ways to use the waste. New products made from the leftovers could add millions to the profits of Alaska seafood processors.

One new product is a 95 percent fat-free chicken patty called Northern Lites. Made from a blend of only 2 percent poultry meat, it consists chiefly of pollock not used in surimi production, with added flavor, color and preservatives. Another product, named after a Bush community in Alaska's eastern Interior -- Chicken Alaska -- is a pasty combination of pollock, egg whites and chicken that when mixed with pickles, mayonnaise and other ingredients makes a tangy seafood salad dressing.

The creator of these foodstuffs, Rae McFarland, describes himself as an idea man. With a pitch that's part salesman, part fundamentalist preacher, McFarland spends considerable time at food shows convincing skeptics of his latest creations. An entrepreneur whose family name has stood over a Utah-based food business since 1890, McFarland has been accused of "processing everything but the cluck, the moo and the oink."

It's an accusation he considers praise. "There's no such thing as waste, only underutilization," says McFarland.

His most recent pitch was to a gathering of nearly 200 seafood industry representatives from 21 states and 10 countries who met in Anchorage to discuss new ways to use bottomfish leftovers generated by North Pacific processors. The four-day conference was organized and sponsored by the University of Alaska Sea Grant College Program, which conducts marine research and provides advisory services to the commercial fishing industry, and the Alaska Fisheries Development Foundation, which conducts joint ventures with the seafood industry and sponsors research to develop markets for underutilized species.

McFarland's products are among many new seafoods now appearing in supermarkets that use edible meat that formerly was not cost effective to recover. Most pollock and cod are processed by feeding the whole fish through a machine that quickly separates the head and slices off the meat portion, or fillet, from each side of the backbone. While the process is quick, it is far from efficient, leaving as much as 15 percent of the edible meat behind.

Pollock Products. New machines now recover much of this meat, boosting production. Processors are finding new ways to use it... in hot dogs, steaks and even a pepperoni-like stick that is actually a surimi-salmon jerky blend.

The process to turn a slippery, slimy fish into a beef steak involves turning the pollock scraps into surimi. Originated in Asia some 500 years ago and considerably refined by modern technology, surimi generally is made by mincing, washing and refining pollock to remove oils, skin and excess bone. After most of the water is extracted, what's left is a stable, highly functional protein low in calories and nearly void of cholesterol.

Surimi has a bland taste. "Most of the molecules that give pollock its fishy taste and odor are washed out in the surimi process," says John French, food scientist and surimi specialist with the University of Alaska Fishery Industrial Technology Center.

He explains that the changes provide advantages for food designers. Being tasteless and odorless, surimi can be blended with other foods, such as beef and chicken.

Consider the SeaFrank. Made entirely of surimi, the federally approved frankfurter gets its all-beef taste from natural beef flavor, soybean protein and starches. Unlike the more conventional hot dog, the SeaFrank contains no nitrites and no preservatives and has less than half the fat with 40 percent fewer calories. It can remain in the refrigerator 90 days, a full month longer than all-beef franks.

What's more, the SeaFrank contains almost as much protein and far more energy-yielding carbohydrates than traditional franks. Shining Ocean Inc. of Seattle markets the product.

Consider also the surimi/beef steak. A blend of surimi and beef, the new steak boasts surimi's low-fat, high-protein advantages along with the taste, texture and look of real beef.

Another gee-whiz product is contact lenses made from the durable chitin shells of crab. Independent industry analysts say by the year 2000 chitin's use in agricultural products, cosmetics, food and beverages will top $700 million. Health care uses alone are expected to account for $500 million, the analysts report.

Health aids such as Omega-3 fatty acids are made from fish oil. Omega-3 helps prevent blood clots that cause heart attacks, reduces levels of blood fats that can lead to heart disease and lowers blood cholesterol levels. Other applications include snack crackers made from a creamy fish protein process developed in Japan, extracts used in a variety of goods from glue to shampoo and dozens of products in the food, cosmetics, health and pharmaceutical industries.

While more efficient equipment and newfood ideas have reduced the amount of edible leftovers, these steps by themselves do not begin to absorb the enormous amount of waste generated by factory trawlers and shoreside bottomfish processors. Seventy percent of the remains -- heads, fins, entrails, inedible scrap meat and bone -- is dumped back into the sea. But this practice is rapidly coming to an end, as federal regulations aimed at curbing ocean dumping become more than just lip service.

For processors who have for years dumped tons of fish waste in specially designated zones off Kodiak and Dutch Harbor, change is only months away. In one zone south of Kodiak along the 50 fathom line near Long Island, millions of pounds of whole fish heads, entrails, scrap meat, and other parts are dumped each year.

In another zone, set aside for processors at Unalaska and Dutch Harbor, an even larger volume of ground parts is dumped. The dumping has "turned the sea into milk and attracted thousands of sea gulls," according to Valerie Haney, U.S. Environmental Protection Agency engineer, whose job is to work with processors to end the practice.

"EPA designated these zones for use on a temporary basis by the processing industry in the early 1980s. But as the bottomfish industry expanded, the zones became a convenient place to dump the waste on a regular basis. The dumping of any waste in these zones will now stop. We are going to take a hard line with these folks," says Haney.

Salvaging Protein. One new product that will be cultivated from the waste is fishmeal. Rendered from pulverized entrails and heads, the protein-rich fishmeal is suitable for aquaculture, pet, poultry and livestock feeds.

An especially promising market is the booming Asian eel aquaculture industry. The black serpent-like creatures are prized in Oriental culture and custom for their rich, delicate meat, and eel farmers in Taiwan, Japan and South Korea are willing to spend millions of dollars on high-quality fishmeal made from North Pacific pollock.

In 1989, eel farmers paid the handful of fishmeal processors as much as $1,000 per ton. More than $33 million worth of fishmeal was exported from Alaska last year.

Although competition from other fishmeal producers such as Peru and Chile has slashed fishmeal prices to half that amount this year, Mike Meehan, By-product Division manager for Icicle Seafoods' Seward and Petersburg plants, says economically and environmentally manufacturing fishmeal is the right thing to do. "If they (factory trawlers) look at the numbers, they will see that it makes sense. Instead of dumping a valuable product over the side they will go for the quality products and use it all," he explains.

Icicle Seafoods of Seattle, Wash., one of the state's largest seafood processors, was one of the first to install shoreside fishmeal plants in 1973. Fishmeals produced from herring, salmon and some bottomfish are sold to pet food and fertilizer manufacturers in Alaska, to Lower 48 feed companies, and to overseas aquaculture interests.

"We installed a fishmeal plant because it was the right thing to do. We thought we could also turn it into a money maker," Meehan says. So far, the venture has not been very profitable, largely because the meal plant operates seasonally. But as raw materials become available year-round, spurred by new markets and increased demand, Meehan hopes to see the venture leap solidly into the black.

Arctic Alaska Fisheries Corp. of Seattle, which operates 22 vessels, the largest factory trawler fleet in the North Pacific bottomfish industry, has invested in a factory ship dedicated to producing fishmeal from the catches of its trawlers. The 180-foot Arctic Vis the first meal-only ship to enter the U.S. bottomfish fleet. Converted from an oil-field service ship, the Arctic V was expected to tie up alongside the processor Arctic Enterprise in September and begin processing 250 tons of fish waste each day.

Says Bruce Buls, spokesman for the Alaska Factory Trawler Association in Seattle, "I suspect they want to get as much value out of the resource as possible. But I also would imagine they're anticipating changes in the law that ban dumping of fish waste."

Brian Kelly, executive vice president of Arctic Alaska Fisheries, says, "It came about mostly because of the fact that we have begun to generate a lot of waste and we decided to do something with it. We certainly feel we can make a profit out of it. But more than that, it signals an interest on the part of Arctic Alaska to get the most value out of the product."

Much of the meal from the Arctic V is expected to be sold to Asia. According to Joel Cowger, analyst with Pacific Rim Marine Products Inc. in Redmond, Wash., Taiwan, the world's largest eel producer, buys some 100,000 metric tons of high-quality fishmeal each year from various sources, including Alaska suppliers. That nation also buys about 400,000 metric tons of lesser quality fishmeal annually.

But Alaska's fishmeal production, coupled with South American production, is expected to outstrip current demand. "If these countries bought nothing but Alaska fishmeal, Alaska would be in the gravy. But they don't, so we have to find new markets," says Cowger. Potential markets are China, which is developing its own eel industry; South Korea, an economically prosperous country with an expanding aquaculture industry and plenty of cash; and the Philippines.

Future Trends. Shrimp and salmon aquaculture also create fishmeal consumers. Although banned in Alaska, salmon farming production worldwide is expected to nearly double by the year 2000, according to the National Marine Fisheries Service. An estimated 1.5 million metric tons of high-quality fishmeal is expected to be needed each year -- three times more fishmeal than the entire Alaska bottomfish industry could produce at current harvest levels. Even at $500 per ton, the prospects of making money are good.

"Aquaculture production of salmon will continue to grow as world consumption increases and as wild salmon harvests remain static," says John Kilpatrick, technical advisor on international seafood business for Trouw International and BP Nutrition. "I expect aquaculture of salmon and other species such as shrimp to increase until it consumes up to 50 percent of the world fishmeal production."

Some of the remaining 50 percent may end up in pet food. Already, Alaska seafood processors have begun to reap dividends in a rapidly expanding $2 billion, U.S. specialty pet food industry. According to Tom Willard, an independent nutrition consultant and former food scientist with the Iams Co., 300 million pounds of fishmeal will be needed for dry pet food and another 100 million pounds for canned pet food by 1993.

"The challenge for (pet food) manufacturers will be to find a reliable source of high quality meat protein at a price competitive with other protein sources, such as poultry by-product meal, dried egg, herring and catfish meal," he explains.

Technological breakthroughs also are enhancing opportunities for by-product entrepreneurs. For example, new machinery being demonstrated in a joint venture between the Alaska Fisheries Development Foundation and North Pacific Processors in Cordova uses enzymes and natural acids to render fish waste into paste and oil. The low-temperature process avoids the expense of cooking and yields fish oil and fish paste much higher in proteins, says Peter Moore, project manager at the development foundation.

The best prospects for marketing products made from fish waste lie with overseas nations, a fact that could only improve the current positive balance of trade for Alaska -- a net exporter of goods in a U.S. economy battered by foreign imports.

But new opportunities in seafood processing are not without risk, and many concerns plague Alaska's bottomfish industry. Among them: too many vessels, overfishing, by-catch and impact on Stellar sea lions. Even as these issues threaten the future stability of supply, they are motivating new developments in seafood by-products. More discoveries are sure to follow.

Douglas Schneider is a science writer with the University of Alaska Fairbanks' Alaska Sea Grant College Program.
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Title Annotation:includes related article about University of Alaska Fishery Industrial Technology Center; Alaska fisheries make seafood products out of fish waste
Author:Schneider, Douglas
Publication:Alaska Business Monthly
Date:Oct 1, 1990
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