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Economic and ecological benefits from sustainable use of the Aral Sea Artemia resources |
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BACKGROUND & JUSTIFICATION
The ecological devastation and economic impoverishment that have befallen the Aral Sea communities are threats to the security of the region and to the health and well-being of the people. The increasing demands upon the water resources have prolonged the adverse ecological and health impacts on the region. There is an immediate need for the communities surrounding the Aral Sea to improve their quality of life through economic opportunities. The Aral Sea ecological change has resulted in total obliteration of the fish stocks upon which these communities formerly depended for their sustenance and employment, and the contemporary Aral Sea is essentially a hypersaline lake with near-total elimination of species of fresh, brackishwater, or marine origin. The likelihood of recovery of fish stocks to the large Aral Sea is very low indeed. Water management alternatives, the introduction of drought tolerant crop strains, less wasteful irrigation methods and other means of mitigating the economic losses and ecological demise of the region may hold some promise for the Aral Sea, but they have been largely unsuccessful. The Aral Sea has undergone such a steady and extreme alteration of its limnological characteristics that it can no longer support its earlier ecological functions nor can it provide the economic opportunities that were once realized by the surrounding communities. The economic consequences of the Aral crisis have had devastating financial and health impacts on local economies and communities. In spite of the good intentions of numerous non-governmental organizations, international aid projects, research investigations, and government assistance programs, economic recovery in affected communities has not been realized, and there are scarce possibilities for reversing this condition for the Aral Basin inhabitants. Any means of economic recovery for the Aral Basin communities would therefore be a most welcome and much needed benefit. Brief statement identifying problem to be addressed by project; its economic and/or social importance and impact of expected project results with respect to situation in partner country There is evidence of a recently colonizing population of the halophilic Artemia in the Aral Sea that holds promise as a commercially viable resource. The development and prudent management of an Aral Sea Artemia resource could provide some degree of economic and ecological recovery to the region through sustainable management strategies that are linked with improvements in the Amu Darya delta and the flow of nutrients and water to the Aral Sea. Because of the emergence of an Artemia population a novel opportunity has arisen that allows a damaged ecosystem to be viewed from a completely different and optimistic perspective. Results of the NATO/CLG grant nr 980143 “Artemia colonization of the Aral Sea: hope for a dying ecosystem” indicate that the Aral Sea has the promise to become a supplier for the world aquaculture industry’s demand for Artemia cysts. Artemia is a valuable component of aquaculture production worldwide. Global demand for Artemia biomass and cysts is on the order of approximately 2000 tonnes per year. Revenues from the sale of Artemia products are in the range of 55 to 95 million USD per year. Over the course of the past two decades the demand for aquaculture products has increased at a rate of 5% to 10% per year. Artemia is an important feed that supports this increase in global production of aquaculture products. The demand for aquaculture products, and therefore Artemia, is likely to continue to increase well into the future. In short, Artemia is a valuable natural resource that, if managed and exploited in a sustainable manner, can offer local communities steady and substantial sources of income and employment well into the foreseeable future. Initial analyses of Artemia cysts collected at the Aral Sea in 2002 and 2003 have revealed characteristics that are quite desirable for aquaculture applications (see § 5.1). The potential economic benefits gained through successful development of the emerging Aral SeaArtemia resource can provide the people of the region with employment and other opportunities that presently do not exist. There is abundant evidence that providing economic advancement for disenfranchised and impoverished communities can alleviate many of the socially disruptive, emotionally destructive, and politically destabilizing activities of people for whom there has been little or no sense of optimism about the future. Security is gained through the sustainable development of a valuable resource and from the social enhancements to the region that are derived from the direct infusion of money, expertise, production facilities, and job opportunities. Additionally, secondary benefits arising out of demands for goods and services and an improved infrastructure will follow. Processed Artemia products that are sold to the global aquaculture market are an export item that generates income of foreign currency for Uzbekistan and Karakalpakstan. The newly colonized Artemia population truly offers hope in the otherwise decimated Aral Sea ecosystem. However, it is insufficiently known whether the current hydrobiological and hydrochemical status and primary productivity of the Aral Sea is sufficient to support a stable Artemia population. Planning for immediate cyst and/or biomass harvesting at this stage is premature, as this could jeopardize the future potential for a viable industry. It is therefore of crucial importance to implement an ecological monitoring program to determine the potential suitability of the Aral Sea as an environment in which one could expect sustained Artemia population growth and productivity. Furthermore, the potential for commercial exploitation will depend on Artemia population dynamics: a consistent high annual rate of cyst production, coupled with high cyst quality, and a low cost of production could certainly result in a marketable export product for the region (see § 4.4). Detailed ecological information is clearly needed in order to evaluate the feasibility and potential benefits of commercial exploitation of Artemia. Expert advice in harvesting, transport, handling, storage, and industrial production techniques are additionally essential for the successful exploitation of the Artemia resource. Science or technology to be developed and applied The research team for this project includes some of the world’s foremost experts in Artemia biology and ecology. State-of-the-art methods for characterizing Artemia, conducting population studies, water quality and phytoplankton assessments in use by scientists from NATO countries will be introduced to partner country scientists. Well-established sustainable management practices developed by the NATO project partners for Great Salt Lake Artemia, Utah, USA and successfully applied for Artemia populations in Russia, Turkmenistan, Kazakhstan and China, will serve as a model for an Aral SeaArtemia management strategy. Most methods for population assessment, hydrobiological and hydrochemical determinations adhere to standard scientific practices. Advancements and new methodologies will arise through the use of improved population models, instrumentation, and laboratory practices. New developments in monitoring devices for sampling and water quality determination, Artemia cyst harvesting, storage, processing and quality control, provide significant advancements in research efficiency for partner country scientists. Cost-benefit analysis, based on expected project results, demonstrating the potential economic impact An accurate cost-benefit analysis for the current SfP Project Plan is severely limited by the paucity of critical information on the hydrological status and future of the Aral Sea and its emerging Artemia population. Estimates of potential economic gains from natural resources are typically characterized by a high degree of variability, numerous uncertainties, and by complex and uncontrollable factors (e.g., local and global climatic conditions) that can exert tremendous influence on the supply and demand for such resources. Much of the proposed research in this SfP Project Plan is necessary in order to determine the commercial viability of the Aral Artemia resource. Detailed ecological, hydrochemical, hydrological, and biological studies of the Artemia population along with sophisticated population models, real-time sea volume determinations, and logistical knowledge of the region, can allow one to make reasonably accurate predictions regarding the resource and its commercial viability. Supply-side factors can be assessed and provide a basis from which the commercial viability can be evaluated. Knowledge of the quantity, quality, and cost of production of Aral Artemia cysts is absolutely necessary for commercial entities and resource managers to make informed decisions regarding the merits of exploitation and marketing of the resource. Population models of the Great Salt Lake (GSL) Artemia have been developed and illustrate the economic and conservation benefits of thorough research and well-formulated interpretation of the scientific data. Population growth models of the GSL Artemia resource have proven to be reasonably accurate predictors of harvest quantities over the past six years; industry harvests totals (i.e., dockside tonnage-all material collected in the course of harvesting) are in the range of 0.83 to 1.36 times predicted harvest tonnage. The GSL Artemia population model developed by Belovsky in 2003 has been the primary tool for GSL resource managers, and to a large extent is responsible for the effective sustainable management approach. One of the primary objectives of this SfP Project is to develop a similar model that can be used for resource managers and for determining the commercial viability of the Aral SeaArtemia. The demand-side of Artemia valuation equations is equally important in defining the potential economic benefits gained from successful commercial exploitation. Aquaculture use of Artemia cysts increased steadily from the mid-1950's reaching a peak of approximately 2500 dry metric tonnes per year in the mid-1990's. Reduced supply in 1999 and 2000 greatly increased the cost of Artemia cysts and contributed to a diminished demand. Demand was already impacted by a variety of factors: shrimp farms in Southeast Asia and South America were experiencing major setbacks from disease outbreaks, reduced consumption of shrimp, legal and regulatory restrictions. Financial crises in Japan, USA, and Ecuador coupled with a general global economic malaise had a significant influence on the consumption of "luxury food items" such as shrimp. Improved efficiency in aquaculture applications of Artemia further lessened the demand. Artemia supply and demand cycles illustrate the volatility of this resource. It is a high-risk industry capable of handsomely rewarding those who understand the vicissitudes of the market and efficiently utilize scientific information for business decisions. There remains much promise for Artemia. Steady growth of the aquaculture industry and the well-established nutritional benefits and practical applications of Artemia cysts as a diet for both finfish and crustaceans continues to be recognized and allows for some confidence in the future demand for Artemia. At present there is a global demand of approximately 2000 metric tonnes dry cysts annually. The price for such cysts has shown large fluctuations over the past decade with year-year fluctuations in end-user prices of 200% to 300%. Pricing of Artemia cysts is directly linked to measures of quality, with 24 hour hatching percentage being the most dominant quality consideration. Highest quality cysts exhibiting a hatching percentage greater than 85% are nearly ensured of being marketable, even during years of a general over-supply and diminished demand. Pricing and demand for lower grade products are dependent upon the availability of 85% and higher quality cysts. Other factors, such as market perceptions of quality and patterns of buying behaviour can also exert a strong influence on pricing and demand for geographically specific Artemia strains. Most recent information from the marketplace indicates a price to retail in the user market of about $14.4 USD per kg 90% dry cysts packaged in one-pound metal cans. Prices and demand diminish from this point with reductions roughly correlating with decreases in hatching percentage (eg., 70% hatching quality = 65% of price for 90% quality cysts). Demand can drop exponentially between quality categories depending upon the composition of the global supply. The average quality of cysts harvested from diverse geographical regions of the world varies considerably. It is a function of the inherent quality of the cysts and, equally important, handling, storage, and processing methods. At one extreme are the cysts from the GSL; skilled harvesters and processors can produce dried cysts with an overall average quality of over 85% for all harvested cysts. In recent years the GSL has produced sufficient quantities of cysts to satisfy the entire global demand. Cysts from other locations may have a maximum quality of 70% hatching percentage with the majority of harvested cysts exhibiting a range of lower qualities. Quantities from other sources ( China, Russia, Central Asia) have shown improved consistency in quality and yields over the past 5 years. Demand for Aral Sea Artemia cysts will be directly related to production in other locations, especially the GSL and Bohai Bay in China. A prolonged population crash in either of these locations would immediately magnify commercial interest in alternative sources such as the Aral Sea. It is unknown whether cysts from the Aral Sea will demonstrate high average quality. The market for Central Asian cysts is generally well below that for alternative sources of cysts, resulting in a decrease in the expected value. Currently wholesale buyers are willing to pay Central Asian cyst producers a maximum of 6.00 USD per kg of processed 75% hatching quality cysts. Buyers’ perception of quality plays a key role in the value of Artemia cysts. Newly introduced cyst strains are often valued less than known sources, even with comparable quality characteristics. Skillful, or alternatively injudicious, introductions of novel strains of Artemia cysts into the market can have a lasting effect on pricing and market interest. It is also for this reason that exploitation and marketing of Aral SeaArtemia cysts should be supported by the best science available. In terms of potential productivity for the Aral SeaArtemia population we calculate that one cyst per liter in the West Aral is the equivalent standing crop of 282 metric tonnes of cysts (wet weight). One cyst per liter in the East Aral Sea would be the equivalent of 53.6 metric tonnes of cysts (wet weight). The percentage of standing crop cysts that are available for harvesting is another unknown. The GSL harvesting industry is perhaps the most efficient in the world and demonstrates a harvest yield of cleaned but unprocessed cysts that is generally 62% to 77% of the total harvested quantity. Cysts cast on the shoreline are harvested (which is the only means likely on the Aral Sea) and are characteristically lower in yield: more debris is collected along with cysts. The result is that dry yields differ substantially between lake-harvested cysts as compared to shoreline-harvested cysts. An average dry yield of 22.7% from harvested weight could be considered to be characteristic of a lake harvest product. In contrast, shoreline harvest yields (harvest weight to dried and processed cysts) is in the range of 9.2% to 15.7%. Utilizing harvesting and processing results from the GSL it is logical that cysts from the shoreline of the Aral Sea could be expected to yield 2.6% to 7.6% of the estimated standing crop. Combining data from shoreline harvesting results at the GSL with Aral SeaArtemia standing crop estimates it is theoretically possible that an abundance count of one cyst per liter the West Aral could yield 7.3 to 21.4 metric tonnes of processed cysts. The same estimate for the East Aral is 2.6 to 7.5 metric tonnes of processed cysts. On the East Aral we have observed cyst abundances in the range of 1.4 to 14.0. Therefore our estimate of dried cyst yield from the East Aral Sea is 5.7 to 57.1 metric tonnes. Our most thorough sampling effort on the East Aral Sea in 2003 resulted in an average count of 3.4 c/l and an upper estimate of 13.8 metric tonnes dry cysts. The highest average count of cyst abundance on the West Aral we have measured is 1.8 c/l, which could yield 52.0 metric tonnes of dry cysts. If we assume that the average hatching quality for Aral Artemia cysts is 75%, and the current market value is 6.00 USD per kg, then the 3.4 c/l count for the East Aral suggests a 2003-2004 harvest could generate a market value of 83,125 USD. At the upper limit of 2003 cyst abundance counts for the East Aral (14.0 c/l) the potential market value for a harvest of 75% hatching quality cysts is 342,280 USD. We have endeavoured to make these estimates conservative so as not to exaggerate the potential economic gains, and we want to emphasize that these values are just estimates (i.e., volumes used for standing crop calculations should be updated with current calculations) and require more accurate and detailed information. It is instructive though to calculate the potential gains if a variety of factors are adjusted upward. For example, an increase from 75% hatching quality to 85% hatching quality combined with a cyst abundance in the range often observed on the GSL (80 c/l) would increase the potential value for an East Aral shoreline cyst harvest to 3,911,778 USD. Returns of this magnitude become attractive for commercial interests, whereas lower estimates would be unlikely to justify the significant start-up costs of a commercial Aral SeaArtemia venture. Although our preliminary work conducted under the NATO CLG grant (see § 5.1) does not suggest that 80 c/l is even remotely probable in the near future for the Aral Sea, a combination of events could shift the balance of economic viability. For example, a modest increase in cyst abundance, reduced labour and production costs (well below costs of production on the GSL), lower shipping charges to markets, and diminished productivity in other global sources could render the Aral SeaArtemia resource more commercially attractive.
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