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Seafood Systems is Michigan’s only shrimp farm
By CECIL E. DARNELL
Michigan Correspondent

OKEMOS, Mich. — Is it possible to produce farm-raised shrimp in Michigan?

Such aquaculture is better known in warmer climates, and the idea of farming shrimp, anywhere, is still fairly new. Russell Allen III is making this happen.

He is exploring long-term development money and envisions locally farm-raised shrimp in Michigan restaurants, dining rooms and economy. He has the experience, the facilities and the only functioning shrimp farm in Michigan.

“This industry has the power to bring jobs from China to the Midwest, where so many manufacturing jobs have been racing abroad in recent years - and days,” said Allen, who is a University of Michigan graduate.

He spent nearly four decades studying the shrimp industry - most of that tenure was in Central America. His collective experience has been transferred into an indoor, environmentally controlled, shrimp production facility. Even the salt water is a Michigan product.

Allen sells shrimp from his on-site farm market; but until the business grows, he only has retail sales on Friday each week. His business has gained enough exposure to provide shrimp for events during this year’s Super Bowl in Detroit.

Seafood Systems is located on Meridian Road, near Okemos in an area that is mostly populated with eye-popping horse farms.

“I took my retirement immediately after completing college,” Allen said. “I bought a boat and began hosting tours in the Galapagos Islands. After growing bored with doing the tours several years, I leased my boat to a travel agency, and found myself in Central America with a U of M degree in fisheries biology and no job.”

That’s when he started his ongoing, real-life learning about shrimp farming.

In 1990, Allen returned to Michigan so his children could go to school here. Shortly after his move, he began exploring and developing the enclosed shrimp farm system that he operates today. He cited a USDA study that said Americans on average eat four pounds of shrimp in 2004 - compared to 60 pounds of chicken. Born and raised in Adrian, Mich., Allen has a subtle emotional hope that his new profession will enhance Michigan’s economy and restaurant and family menus.

“If all I was concerned about was a commercial shrimp operation, I would be working in one of the Far Eastern countries where overall conditions are especially encouraging to such developing ventures,” Allen explained.

Shrimp farming history
Allen said shrimp farming started in Ecuador - almost by accident. A farmer along the coast simply filled in a lagoon with a bulldozer while the tide was in. A few months later, he discovered that this area was loaded with shrimp.

“Our combined efforts in Ecuador took the shrimp industry from beginning production of 100,000 pounds to 50 million pounds annually in five years - then 10 years later to 220 million pounds,” Allen said.

He called this a “unique success story” that evolved because all the pieces fell into place. From Ecuador, the industry and technology spread across the world - Central America, Thailand, Asia, China, India and the Middle East.

After Ecuador, Allen took his talents to Belize when it became independent in 1980. He went to work with John Snell of Snell Environmental Group, a Michigan businessman with 8,000 acres where he wanted to start a shrimp farm.

“When we closed out our interests in Ecuador and shifted our focus to Belize, we outfitted here in Michigan,” Allen explained. “We bought a truck and loads of other supplies. We looked like the Beverly Hillbillies when we started our journey to build a shrimp farm in Belize.

“At this time, the popular opinion was that shrimp farming could not be done on the Atlantic side of Central America because everything earlier had been located on the Pacific side.”

Today, shrimp is the biggest export for Belize. Allen said everywhere shrimp has been farmed, it has become a force in that country’s balance of trade.

The United States imports between 1.4-1.5 billion pounds of shrimp per year. Outside of oil and automobiles, seafood is the third item in the unfavorable balance of U.S. trade, and shrimp represents 70 percent of that.

The USDA noted, in 2003, the United States imported 1.112 billion pounds of shrimp. Top importers include:

•Thailand 294 million pounds
•Vietnam 126 million pounds
•China 179 million pounds
•India 100 million pounds
•Mexico 56 million pounds
•Ecuador 75 million pounds
•Indonesia 48 million pounds
•Brazil 48 million pounds
•Bangladesh 18 million pounds
•Philippines 3 million pounds

When domestic producers can provide the shrimp economically, Allen explained, these figures should modify.

Not a shrimpy demand
In 1992, Allen seriously started looking into shrimp farming in Michigan.

“We organized a committee of different stakeholders,” he said. “MSU was involved. We had the DNR, MDA, DOC, farmers and other interested parties and studied Michigan legislative possibilities. Ventures do not work without legislation in place to provide a framework for the industry.

“In Michigan it took five years, with the help of Mike Rogers, we were successful in getting a bill written that was passed in 1996, providing the framework for this unique development. With this legislation the control of aquaculture moved from the DNR to MDA. This, in fact, stated that we were farmers, not fishermen.”

In 1994, Seafood Systems was formed.

“Under that banner we started studying the possibilities of growing saltwater shrimp in a recirculation system,” Allen said. “This type of system eliminates such things as a bird flying over and pooping in the water, turtles and alligators climbing over dikes and getting in, greater survival rate. You can keep out diseases, so the control factors are closely governed.

“All my calculations indicate that we can grow shrimp here in Michigan cheaper than anyplace else in the world. Our Commercial Pilot Project gives us a proven example. Building construction is viable within the numbers, and we learned that the rest of the numbers also fall into place.

“The next phase is to go on with commercial facilities. We have been told by suppliers that there are another three dozen companies within the U.S. that are working on programs similar to what we have created. Tuna fish consumption in the U.S. was recently pushed into second place by shrimp.

“When we get big enough, we can grow shrimp about as cheaply as you can raise chicken. We have a .7:1 ratio now. That means .7 pounds of feed produces one pound of shrimp. Nothing else can do that, not pork or beef or chicken.

These are some of the numbers that encouraged the development of the shrimp farm concept. To date, domestic agencies and governmental bodies have not devised funding philosophies that are as friendly to venture capital needs. Domestic projects have lost to offshore companies working to accommodate the U.S. market. Raising long-term venture capital has been a holdup for developing the industry.

Private investors, rather than governmental programs, may ultimately provide the $10 million that Allen estimates is needed to go totally commercial with indoor shrimp in the Midwest.

For more, visit www.shrimpnews.com Call Allen at 517-347-5537 or by e-mail at shrimpone@aol.com

This farm news was published in the March 1, 2006 issue of Farm World.

3/1/2006