34 



culture is that it is labor intensive. It provides jobs for the skilled 

 and unskilled. The bad news is the production costs because of this 

 labor intensiveness. So, the solution is leading technology. It is 

 very difficult for us to compete with labor costs in all parts of the 

 world, but we can compete if we have the leading technology. 



The private sector can provide animal husbandry, production, 

 and marketing, but it cannot provide R&D biotechnology. There are 

 no sources of funds for this to be done by private industry. Banks 

 would not lend the money, venture capitalists would not invest the 

 money, and corporate earnings could not support it. So, either the 

 Government steps forward or it will not get done. Compare this 

 with the Japanese spending $100 million plus per year on the same 

 subject. 



Let me comment on the assessment of current existing Federal 

 research transfer, from which we have benefited through the South 

 Caroline Marine Resources Department and the Sea Grant Consor- 

 tium. A direct application which we are using is brood stock main- 

 tenance, which is the first building block of aquaculture. 



Spawning every Tuesday morning, we invite you down to watch 

 us spawn 200 million clams. The local TV station did a segment on 

 it and they called it "group sex," which set back the field of biology 

 2 or 3 years, but we spawned 200 million that day also. And our 

 hatchery and post set, which is the first month of life, is in a highly 

 controlled environment. And these conditions and protocol were de- 

 veloped by Marine Resources and with funds through Sea Grant. 



The nursery production which is 1 to 4 months a clam's life, 

 product control, laboratory protocols and data, and identifying criti- 

 cal variables, all the things which make our operation work, and 

 all of these things were the reasons we went into business because 

 they existed through these types of programs. And so without all 

 of this available to us we absolutely would not be 82 people strong, 

 fully operational, and on the way to 300 associates in our company 

 by 1996. 



On suggestions to strengthen, I would suggest that you be sure 

 to include the link between the scientific and academic community 

 and the producers. Sea Grant has played this role and has played 

 it well. Without this link, 50 to 80 percent of the R&D may be in- 

 teresting but of doubtful economic value. 



Economic value means job creation, environmentally concerned 

 businesses, a career for both unskilled and skilled individuals from 

 OJT to Ph.D., and a real opportunity to reduce imports and in- 

 crease exports. 



So, thank you for hearing me out and I will be glad to answer 

 any questions. 



Senator Stevens. Thank you very much, Mr. Helms. Let me go 

 to Mr. Silva. 



STATEMENT OF MARK SILVA, RESEARCH DIRECTOR, 

 AMERICAN PROTEINS, SANDWICH, MA 



Mr. Silva. Thank you, Senator. The American Proteins business 

 is in the protein recycling business in the poultry industry. We are 

 actively engaged in marine technology, biotechnology, research pro- 

 grams particularly in omega oils or fish oils. We are actively en- 

 gaged in fishing internationally. We have four plants in Peru. We 



