tions of chitin or derivatives there is presently no market, in part at least because there is no supply. There are only about three major chitin plants in the world: in Japan, Washington (now closed), and Norway. New plants are opening in India and China. Research on applications may provide important tools for marketing, aside from the prospect of spin-off industries.

Implementation Plan

The Alaskan-Quebec consortium has estimated $5 million to build a plant in PEI, using their own technology, and is looking for a 50 per cent partner. The storage tanks would cost additional. A local consortium to partner with the Alaskan-Quebec group may be a valid solution, and there is much venture capital in PEI looking for projects. Alternatively, the local group can lease the Quebec technology and test it in a pilot plant. If it is economical and successful, they could try to buy or license it.

The lobster processors have a natural interest. The Food Technology Center might also take a share; it is now able to enter an arrangement with a private partner. If there is a promise of many jobs, the government might contribute; if promise of profit, the venture capitalists. One venture capital fund, for example, has $30 million to invest in Atlantic Canada. There are also Federal funds available to support science and technology initiatives, which might support the pilot project. Even DuPont has components that provide venture capital.

The processing community is not likely to take the initiative but might be persuaded to join a developing venture. A manager should be sought, a technical person with knowledge of marketing and procurement. At an early stage he or she should approach the processors to engage them as partners; this is crucial to avoid major problems with supply or competition later on. Following a recent restructuring of the industry, there are presently seven independent suppliers on the Island; the largest of these, Polar Foods, controls about 50-60 per cent of the shells. As a partner, Polar Foods alone could guarantee an adequate supply.

Probably the most immediate need is for funding to cover the cost of the pilot plant R&D program. As generic research that could benefit an entire industry, it might qualify for government funding. If the Quebec technology does not work out, there are other, unpatented technologies that might be adapted successfully to process the material available on PEI. An advantage of this course would be that the expertise thus developed could be licensed to other areas of high shell supply, such as Central America. In the longer term, this expertise could be expanded to include systems knowledge related to resource management, feedstock storage and transport, and marketing, as well as the processing technology itself. Chitin processing would thus become the basis not only for a new export product, but also a highly exportable knowledge-based service.

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