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Aquaculture production in the Central Appalachian Mountains, including West Virginia, can be characterized as small-scale because the water resources on farms are relatively low flow (less than 200 gallons per minute) cold water springs and streams, and small farm ponds (one surface acre or less). Common to many areas of the region are the significantly under utilized water resources in the discharge from active and abandoned none sites. With some level of pre-treatment, most of these mine site sources are acceptable for production with respect to water quality for cold water fish species such as rainbow trout (Onchorychus mykiss) and arctic char

This project strengthens the base of information needed for a viable, competitive, cold-water aquaculture industry in Appalachia with focus on West Virginia. Key constraints to aquaculture industry growth and enterprise establishment are targeted by the project including:

A technology transfer program - including cooperators from the private sector, state government, federal government, and the university - is proposed so as to promote state, regional, and national adoption of the research results from the project.

The Appalachian region as defined by the Appalachian Regional Commission is composed of all or part of thirteen states. Since, however, the applications of research findings of this program will be most relevant to the type (and temperature) of water found in the immediate region, only states of the region with significant cool and cold water conditions are under consideration. Therefore, the scope of the study is limited to cool and cold water species, With this scope in mind the geographic region to be studied includes the following eight Appalachian regional states: West Virginia, North Carolina; Kentucky, Virginia, Ohio, Maryland, Pennsylvania and New York. Some aspects of the project will include information and data from states other than these eight. But the primary focus of the project will be on organizations operating within this eight-state region, and because the working arrangements for research at West Virginia University favor the state of West Virginia, much of the research will draw from that state.

The specific objectives of this project address state and regional needs by improving the short-term viability and long-term sustainability of aquaculture production and processing firms in West Virginia and similar areas of Appalachia. The increased contribution of regional aquaculture products to regional, national, and export markets will add support to global competitiveness of U.S. aquaculture and to meeting regional and national consumer demands for safe, affordable, food.

Objective 1. Develop marketing strategies for aquaculture (primarily trout) producers and processors.

A. Expected Outcome: analyses of five fee fishing markets for Appalachian aquaculture (primarily trout) products will identify alternative production and marketing strategies for producers and lead to increased economic returns.

B. Expected Outcome: analysis of processed (food) markets for Appalachian aquaculture (primarily trout) products will identify alternative production and marketing strategies for producers and processors and lead to increased economic returns.

Two distinct but interdependent marketing research studies will provide the information for analyses. The first, based on a survey of potential fee fishing operations and users (fishermen and fisher women) of Appalachian five fish products, will identify related market opportunities for producers. The second market study concentrates on current and potential buyers of Appalachian processed fish products and will identify opportunities for producers and processors for these products.

Personnel. Scientists primarily responsible for Objective I accomplishments are Cyril Logar, Thomas Ponzurick, and Kenneth Semmens.

In order to develop an effective marketing strategy for Appalachian aquaculture products, the market demand must be thoroughly researched and the results disseminated to area producers and policymakers. This research must be comprehensive in nature and address the specific market requirements of the various segments of the aquaculture market. In order to identify these segments, and in preparation for this study, the investigators have had a number of meetings with aquaculture experts and advocates throughout the region. These individuals represented federal and state government organizations, academicians and most importantly those in the business of aquaculture. From these discussions two distinct markets segments have been identified for targeting Appalachian aquaculture products. These segments are: (1) fee fishing market opportunities; and (2) food fish market opportunities including value-added processing market niches. Understanding the market needs and market demand of these two segments will be especially beneficial for the small and medium size aquaculture producers operating in the identified Appalachian region of the united states.

Included in the understanding of these market segment needs, is an understanding of the value each segment places on competitive products (species). In order to evaluate competitive products, it will be necessary to collect information on other cool and cold water fish species that can flourish in the Appalachian region. Cool and cold water species to be compared to Appalachian produced rainbow trout for the fee fishing segment win include but not be limited to hybrid striped bass, yellow perch and other species of trout while the focus for the processed segment will be mainly on trout species. Aquaculture producers have indicated that these species need to be given consideration in the marketing studies proposed here. Secondary research has also indicated that these species may provide opportunities for successful aquaculture production in the Appalachian region described here but these opportunities have not been verified through primary research. Thus, comparative information into the marketing viability of these species is necessary and will be included in the market survey methodology.

The outcome of this methodology will be the identification of a strategy and a subsequent marketing plan for each market segment (fee and processed food fish markets) identified here. The marketing plan developed with the results of this research will provide a directional roadmap for producers as well as policymakers responsible for marketing Appalachian produced aquaculture products. The research methodology required to identify this strategy and develop this plan is discussed in the following section.

The goal of the marketing and economic impact segment of the proposed aquaculture program is to identify and assess market opportunities for aquaculture products produced in the defined (eight-state) Appalachian region of the United States. Specifically, market segments to be assessed will be fee-fishing operations and processed fish food products. Although rainbow trout will be the primary focus other species compatible to the region and noted earlier win also be included in the analysis. The outcome of successfully achieving this goal will be the identification of the region's competitive marketing advantage and a vision for directing the future of aquaculture activities in the region.

This goal will be achieved through two distinct but interdependent marketing studies. The first study will analyze the fee fishing market opportunities in the Appalachian region identified above. The second study will analyze opportunities for processed fish food products in the same geographic region.

Market Study One is designed to survey fee fishing operators and the users who might patronize these fee fishing operations. The study will address specific issues including the identification of fee fishing operation buyers in the region, the location, and aquaculture needs, of these fee fishing operational buyers, determination of market size and potential demand as well as the identification of potential barriers and possible solutions for overcoming these barriers. Both catch and release as well as catch and keep fee fishing operations will be included. The study will also identify and survey users of fee fishing operations (i.e. fishermen and women). The objective of this survey is to identify user needs, and determine market size and market potential. These users will also be asked to identify barriers to patronizing fee-fishing operations. Two separate but interrelated questionnaires will be designed so that demand can be determined and compared from perspectives of both operators and users. The results will lead to the development of appropriate marketing strategies for both fee fishing operators and the suppliers of five fish to these operators.

The following tasks will be followed to meet the objectives of Market Study One that is designed to survey fee fishing operators and fee fishing users in the specified geographic region.

Fee fishing operations and users who could patronize fee fishing operations win comprise the two samples selected. The extent of demand for Appalachian produced fish stock by these fee-fishing operations will be analyzed and the opportunity assessed in the strategic marketing plan for fee fishing.

From the perspective of users patronizing the fee fishing operations, it is hypothesized that demand for fee fishing is not currently being met by the fee fishing operators. Therefore, the extent of this unmet demand will be determined and a marketing strategy produced for how to best meet the demand for recreational fee fishing in this Appalachian region.

(A) Secondary data has been obtained and reviewed to assist the researchers in better understanding what has been done and how it might pertain to this study. It is also the purpose to compare the findings of this research with those of prior published work and build on the basis of knowledge currently available.

(B) The investigators have contacted appropriate agencies of the U.S. government and private sector aquaculturalists. The investigators have also met with aquaculture experts in the region and toured some of their facilities, gaining valuable anecdotal insight into the needs and perspectives of these aquaculturalists.

(C) A sample frame of the respective aquaculture populations will be generated based upon the information gathered from the contacts described above. Market Study One will have two distinct sample populations-fee fishing operations and fee fishing operation users. The sample frame for fee fishing operations will be drawn fi7om state government business and tax records for fee fishing operations operating in the eight-state region identified above. The sample frame for the fee fishing users will be drawn from professional fishing organizations such as Trout Unlimited

Although there appears to be a potential for duplication of the same producers being surveyed in both Objective I Task I and Objective 2 Task 2-1, the researchers, through a coordinated effort, have taken this into consideration and will not allow this overlap to occur. This potential for duplication exists only for those West Virginia operators producing fish for both food and fee fishing.

(D) To meet the goal of this study, primary data will need to be collected. Although various forms of data collection are available to the researchers (i.e. personal interviews and mail surveys), it is proposed that the primary data be collected from the fee fishing operators in a two-step manner. Step one will include a limited number of personal interviews with fee fishing operators. Step two will be a telephone survey of a representative sample of the population of fee fishing operations in the geographic region defined by the scope of this study. Although other methods are available, the most cost effective research method for acquiring the necessary information and realizing the objectives of this study in the time frame allotted is a telephone interview method. The telephone survey method frequently provides the fastest turnaround and does so with a minimum of interviewer bias. It is also less costly when the number of required responses is small or the sample is to be taken from a distinct population such as those fee fishing operations reflected in this study (Dillman 1978).

A two-step process will also be utilized for collecting data from the users who may patronize fee-fishing operations. Step one will again be a limited number of personal interviews with persons who may be users of fee fishing operations. Step two will be a mail survey of a representative sample of the fishing population. This sample will include both users and nonusers of fee fishing operations. By gathering information from both groups, a targeted marketing strategy can be designed. The mail survey will be the most cost effective to reach the users/nonusers since it is geographically dispersed and less homogeneous population than the fee fishing operators (Dillman 1978).

The sample goal for both surveys (operator and users) will be to obtain completed interviews that represent a 95 percent confidence interval with a sampling error of + 5 percent.This means we can be 95 percent confident that the results reflect the characteristics and demand of the sampled population.

(E) Two distinct but complementary questionnaires will be designed for researching the fee fishing initiative. The first questionnaire will be designed for the fee fishing operators. The second questionnaire will be designed for the fee fishing users. The questionnaires will be designed after personal interviews have been conducted with selected individuals from each market. Questions will be designed to ascertain the demand for Appalachian raised live fish by the fee fishing operations, the respondent's interest in purchasing five fish product from Appalachian producers as well as particular interest in species and marketing program initiatives. Questions for fee fishing operation users will address issues related to their fishing habits including the number of times they fish annually, where they fish, expectations from a fishing outing, preferred fishing species as well as future intentions as they relate to fee fishing patronage. Both surveys will seek to identify barriers for utilizing Appalachian produced five fish products and possible solutions for overcoming these barriers. Also, both questionnaires will be designed so that data comparisons can be made between the results of both samples.

(F) Design and review of the two fee fishing questionnaires should be completed in the first four months of the project, April-July 1999. (The estimated time schedule for all tasks presented in Objective 1 of this proposal are based on the assumption that the start date for this project will be April 1, 1999).

(G) The completed questionnaires will be pre-tested in their respective markets prior to the initial contact. A sample selection of fee fishing operators and fee-fishing operation users will be subjects of the pre-test. Results will be analyzed to determine any shortcomings. Adjustments, if any, will then be made to the questionnaires. Pre-test of both questionnaires in the fee fishing market will take place in July-September 1999.

(H) Following the pre-test, the survey document will be used to interview fee fishing operators including those operators who failed to respond to the pre-test. It is anticipated that the interviews for the fee fishing operators will take place in September-November, 1999. The survey designed for the fee fishing users/nonusers market will also be distributed following the pre-test. The anticipated time frame for this mail survey is September-December 1999.

(I) The completed questionnaires will be maintained by the investigators at West Virginia University. The results obtained from these questionnaires will then be coded, entered and stored on an IBM-compatible computer at West Virginia University. The data will be analyzed using the SAS software package. This process will take place from January-March 2000 for the fee fish data.

(J) The data will be analyzed to determine the potential demand for Appalachian produced aquaculture products (from both the operator and user's perspective), fee fishing operator requirements for Appalachian produced aquaculture products, as well as operator and user preferences for products and service. Comparisons win be made where appropriate. It is anticipated that both metric and non-metric data will be collected. Therefore, data analysis will include both descriptive as well as inferential statistical analysis. Descriptive analysis will include means, frequencies and cross-tabulations of the data so as to gain insight into the trends found in the results. Inferential statistical analysis will focus on parametric procedures, specifically tests of significance and analysis of variance.

Task 1-2 will identify marketing opportunities for Appalachian aquaculture products in the fee fishing market and to develop a fee fishing marketing strategy and subsequent marketing plan to promote these opportunities. Policy implications inferred from these findings will be reported. The purpose of Task 1-2 is to use the analysis of the survey results to (a) identify potential buyers in the fee fishing market, (b) the location of fee fishing operations, (c) assess the potential demand for aquaculture products in the fee fishing market, (d) determine customer requirements for aquaculture products in both the operations and user market, (e) determine the preferences for products and service, and (f) the identification of and alternative solutions for overcoming barriers to aquaculture production. The study will need to determine how many fee fish operations cannot provide some or all of their own fish stock and thus provide a potential opportunity for Appalachian aquaculture producers.

(A) Aquaculture producer characteristics deemed to be most important to aquaculture fee fishing buyers will be determined. These results will be used to assist Appalachian suppliers in modifying and adjusting their marketing approach to buyers in the fee fishing market segment. The results will allow Appalachian suppliers to better serve the needs and meet the expectations of these buyers.

(B) A marketing strategy and implications for approaching the fee fishing operators and potential fee fishing users will be generated and provided in the final report.

(C) An overall marketing plan to promote the opportunities identified by results generated by Marketing Study One for the fee fishing market, will be developed and included in the final report.

(D) A final report will be prepared using the data analysis portion of Task 1-1 of this project. AU material gathered by the researchers while conducting the study will be turned over to the USDA.

(E) Results of this project will be disseminated through several outlets. Results to the fee fishing operators and the aquaculture industry will be disseminated through channels that have been developed by West Virginia University and the West Virginia University Extension Service and will be addressed, in part, by Objective 4. Dissemination to the research community will take place through presentations at technical and scientific meetings and through publication in appropriate scholarly journals, including journals in the field of aquaculture and in the field of business marketing with USDA-CSREES cited as the funding source for all publications that result from this study.

Marketing Study Two is designed to collect data from potential buyers of Appalachian processed fish products and identify market opportunities for these products. The study addresses specific issues including the identification of potential processed fish buyers, the location and needs of these buyers, determination of market size and potential demand, the potential for value-added products as well as the identification of potential barriers and possible solutions for overcoming these barriers. Discussions with aquaculture experts indicate that the best opportunity for small- and medium-sized operations in Appalachia region may be in niche markets. Thus, the value-added aspect of Market Study Two is critical in identifying and developing strategic niche marketing opportunities.

The following procedures will be followed to meet the objectives of Market Study Two.

A constraint to the growth of the Appalachian aquaculture industry is a lack of an organized effort to assist small- and medium-scale producers in developing marketing strategies and plans which lead to marketing programs designed to serve previously identified customer markets (O’Dierno and Gall 1995). Although a number of aquaculture studies have addressed some portions of this area, none have been found to be directly applicable to the market situation faced by today's Appalachian aquaculture producers (Chopak 1992: Pomeroy and Sheehan 1991; and Frobish l991). More specifically, none have had as their objective the same scope of study as addressed here (Hanson 1996; Gempesaw et al. 1996; and Block 1984). Market Study Two will, therefore, provide information for the development of marketing strategies and a marketing plan for Appalachian aquaculturalists producing product for the reseller market.

With this in mind, reseller organizations (wholesalers, retail buyers and restaurants), which buy and sell aquaculture products will comprise the sample selection for the processed fish study (Market Study Two). Extensive use of the channels of distribution for the purchase of these products will be used to identify and select research participants. In this manner, the research can address value-added product potential from current users as well as possible opportunities for aquaculture products from those who do not currently purchase these products.

The specific activities to be undertaken, or already initiated, are:
(A) Secondary data has been obtained and reviewed to assist the investigators to better understand the aquaculture markets prior to conducting this particular marketing research study. The purpose is to use these prior studies to assist with the methodology of Market Study Two. It is also the purpose to compare the findings of this research with those of prior published work and build on the basis of knowledge currently available.

(B) The investigators have contacted appropriate agencies of the U.S. government and organizations involved in aquaculture production and sales (e.g.,, West Virginia Department of Agriculture- the USDA/ARS National Cool and Cold Water Aquaculture Research Center; and the Freshwater Institute- Minaqua; Mountain Aquaculture and Producers Association; and the West Virginia Aquaculture Association). The investigators have also met with aquaculture experts in the region and toured some of their facilities, gaining valuable anecdotal insight into the needs and perspectives of these aquaculturalists.

(C) The sample frame for Market Study Two will focus on the organizational buyer and be drawn from several sources. Wholesalers will be identified and selected from the Buyers Sourcebook that provides a comprehensive fist of wholesalers. Restaurants will be selected from a master fist provided by the National Restaurant Association while the retail sample will be drawn from the National Grocer's Association. Organizations selected for inclusion in this study will be drawn from the eight-state Appalachian region defined in the scope of this study. It should be noted that Market Research Study Two focuses on organizational buyers rather than the ultimate end consumer. The reason for this is threefold: 1) prior aquaculture research has provided insight into overall consumer perspectives on aquaculture products (e.g., Hanson 1996; O'Dierno and Gaff 1995; Wessells, et al. 1994; and Block 1984) and, therefore, replication is not critical at this point in time; 2) the researcher's experience with other products in similar marketing situations has shown that it is extremely important to document the needs and behavior of the reseller market distributing to the region being targeted if producer success is to be realized; 3) interviews of experienced aquaculturalists have indicated that successful niche marketing for Appalachian aquaculture products should begin with a thorough understanding of the reseller market if one is to thoroughly understand the barriers to the successful marketing of Appalachian aquaculture products. By analyzing resell buyers, barriers affecting the effective distribution of Appalachian aquaculture products can be identified and addressed by this study. It must be realized, however, that tracking of consumer trends via consumer directed studies is crucial to long-term success and should not be ignored but can be delayed by using the results of prior research until the project has matured.

(D) To meet the goal of this study, primary data will be collected. Although various forms of data collection are available to the researchers (i.e., personal interviews and mad surveys), it is proposed that the primary data be collected in a two-step manner. Step one will include a limited number of personal interviews with current and potential aquaculture, organizational buyers. Step two will be a telephone survey of a representative sample of the aquaculture organizational buying population. Although other methods are available, the most cost-effective research method for acquiring the necessary information and realizing the objectives of this study in the time frame allotted is a telephone interview method. The telephone survey method frequently provides the fastest turn around and does so with a minimum of interviewer bias. It is also less costly when the number of required responses is small or the sample is to be taken from a distinct population such as those reflected in this study (Dillman 1978). Moreover, it was recommended by those we have interviewed that a telephone survey is the preferred method of communicating the required information to the researchers.

The sample goal for the survey will be to obtain completed interviews that represent a 95 percent confidence interval with a sampling error of + 5 percent. This means we can be 95 percent confident that the results reflect the characteristics and demand of the sampled population.

(E) Three distinct, complementary, questionnaires will be designed for researching the fish food processing reseller market. The first questionnaire will be designed for wholesalers, the second for retail buyers, while the third will be designed for restaurants. All three questionnaires will be designed in such a manner that comparisons can be made between the three groups surveyed.

The questionnaires will be designed after receiving input from personal interviews with organizational buyers operating in the market for processed fish products. These questionnaires will be designed to ascertain the respondents' interest in purchasing Appalachian aquaculture products as well as potential for value-added opportunities. The questionnaires will also seek to determine species and product specifications desired by the respondent if they are interested in buying these value-added products. A section of the questionnaires will be used to gather marketing-related information. These questions will ask the respondent to identify marketing issues and features that are important to meeting their product needs and market demand. Also questions to determine the volume and value of aquaculture products currently used by the respondents will be included as well as demographic questions about the organization itself. These questions will allow the researchers to both identify and determine the market potential for various products in the organizational reseller market. The results will allow the researchers to design a market-driven marketing strategy for those suppliers wishing to meet the product and market needs of the reseller market.

(F) Questionnaires designed to gather some of the information have already been generated, tested and implemented by other investigators in prior study of aquaculture product buyers (Wesslls et.al. 1994; D'Souza et.al. 1993; and Keenum and Dillard 1984 . These will be used as a point of reference by the investigators in this study. The time frame for designing the food fish questionnaire is expected to be November-December 1999.

(G) The completed questionnaires will be pre-tested in their respective markets prior to the initial contact. A pre-test sample of wholesalers, retail buyers, and restaurants will be selected and analyzed. Results will be analyzed to determine any shortcomings. Adjustments, if any, will then be made to the questionnaire. Pre-test in the food market will take place during January-February 2000.

(H) Following the pre-test, the survey documents will be used to interview buyers in each of the respective markets identified including those firms who failed to respond to the pre-test. It is anticipated that the interviews for the food fish market will be administered in March-June 2000.

(I) The completed questionnaires will be maintained by the investigators at West Virginia University. The results gained from these questionnaires will then be coded, entered and stored on an IBM-compatible computer at West Virginia University. The data will be analyzed using the SAS software package. This process will take place from July-November 2000 for the food fish data.

(J) The data will be analyzed to determine the potential demand for Appalachian aquaculture products, buyer requirements for Appalachian products, and organizational buyer preferences for products and service. This will be done for all three reseller markets (wholesalers, retail buyers and restaurants) with comparisons made where appropriate. It is anticipated that both metric and non-metric data will be collected. Therefore, data analysis will include both descriptive as well as inferential statistical analysis. Descriptive analysis will include means, frequencies and cross-tabulations of the data so as to gain insight into the trends found in the results. Inferential statistical analysis will focus on parametric procedures, specifically tests of significance and analysis of variance.

Task 1-4 will identify marketing opportunities for Appalachian products in the food fish markets and to develop a marketing strategy and subsequent marketing plan to promote these opportunities. Policy implications inferred from these findings will be reported. The purpose of Task 1-4 is to use the analysis of the survey results to (a) identify potential Appalachian aquaculture product buyers, (b) the location of these buyers, (c) assess the potential demand for Appalachian aquaculture products, (d) determine customer requirements for Appalachian aquaculture products, (e) customer preferences for products and service, and (f) the identification of and alternative solutions for overcoming barriers to Appalachian aquaculture production. Customer is defined to mean organizational buyers or users and not the end consumer.

Specific activities to be undertaken are:
(A) Aquaculture producer characteristics deemed to be most important to aquaculture organizational buyers will also be determined. These data will be used to assist Appalachian producers in modifying and adjusting their marketing approach in each organizational reseller market segment. The results will allow Appalachian producers to better serve the needs and meet the expectations of these organizational buyers.

(B) Market strategies and implications for both product and supplier characteristics will be generated and provided in the final report. Marketing strategies will be provided for both the fee fishing and food fish markets.

(C) An overall marketing plan to promote the opportunities in the processed food fish market identified by this research process will be developed and included in the final report.

(D) A final report will be prepared upon completion of the data analysis portion of Task 1-3. The proposed date for submission of the final report is twenty-four (24) months after project commencement. At that time, all material gathered by the researchers while conducting the study will be turned over to the USDA.

(E) Results of this project will be disseminated through several outlets. Results to aquaculture industry will be disseminated through channels that have been developed by West Virginia University and the West Virginia University Extension Service and will be addressed, in part, by Objective 4. . Dissemination to the research community will take place through presentations at technical and scientific meetings and through publication in appropriate scholarly journals, including journals in the field of aquaculture and in the field of business marketing with USDA-CSREES cited as the funding source for such publications.

The results of Market Study One and Market Study Two will identify opportunities for Appalachian aquaculture producers. These opportunities will be focused through the development of the strategic marketing plans which, when disseminated to and implemented by the industry, will contribute positively to the economic development of the region. Public policy officials can also use these strategic marketing plans to focus their economic development initiatives as they pertain to the aquaculture industry in the region.

As with any research effort, it is necessary to specify the limitations of the study. These include limitations of the purpose, methodology and data generated in the study.

One limitation that the investigators may face in implementing this study is the development of a current organizational list of users and potential users of Appalachian aquaculture products. Research into the availability of such fists has generated preliminary fists of potential organizational buyers. However, it is a well-recognized problem that lists of potential respondents tend to be dated quickly, especially in the consumer market (Churchill 1995). Since this study is focused on organizational buyers, the issue of out-of-date respondents should be minimal. Still every effort will be made to update the organizational respondents' sample population fist. However, even though every effort will be made to update the organizational user list used in the study, the length of time associated with data collection could limit the results.

As with any study of this nature, the degree of cooperation achieved between the researchers and respondent could affect the outcome. Therefore a second limitation faced by the investigators is the issue of non-response bias. This limitation is present in most cases where data is collected via a survey. However, this should not be a special issue in this study since the researchers will be have the ability to do non-respondent follow-ups through sub-sample telephone conversations. Also, if U.S. government agency census data is available in time, final results will be compared to the market as a whole by comparing the aquaculture sales figures provided by the respondents with the census statistics provided by the U.S. government agencies. This will provide an indication of the market share represented by both the respondents and non-respondents. Although these measures will not eliminate non-response bias, it is hoped that they will minimize the impact of this limitation on the study.

Objective 2. Examine the economic and financial feasibility of alternative aquaculture species focusing on hill land such as that in West Virginia in particular, with implications for the Appalachian region in general.

Expected Outcome: Providing baseline, production-related information relevant to hill-land, small-scale aquaculture, could improve producer- decision-making, enhance their competitive position, and assist with policy formulation.

Personnel: Scientists primarily responsible for accomplishments of Objective 2 are Gerard D'Souza and Dennis Smith.

The economic viability of aquaculture enterprises depends on firm-level technical production relationships, the effects of scale, input and output prices, and the market and organizational structure of the industry. The following analyses, outlined under specific tasks, will be performed to determine these relationships, effects, and factors to allow adequate planning and improvement of the aquaculture industry. Given site specificity, and since the analysis is motivated primarily by the needs of the nascent West Virginia aquaculture industry, the study area is limited to West Virginia; however, there will be spillover effects. Thus, information from surrounding states (including but not limited to Pennsylvania, Maryland, Virginia and North Carolina) where aquaculture is more established will be examined as a part of this analysis. In addition to providing a useful regional perspective for this study, implications can be derived from the results of the proposed study that, in turn, could benefit the aquaculture industry in surrounding states.

TASK 2-1: The first step in determining and assessing aquaculture firm-level production costs, management practices, and marketing arrangements, is to identify the number, size, and location of existing West Virginia aquaculture producers and processors and the current markets they serve.

Given their relatively small number, a complete list of current producers and processors operating in West Virginia will be developed¹. Producers will be jointly interviewed by project and Extension personnel to collect detailed information on technical and economic factors related to the aquaculture enterprises as well as other farm and non-farm business activities. This information will include, but is not limited to, the types, sizes, and costs of their physical facilities; operating costs of their enterprises by item such as feed, labor, medication, harvesting, and interest charges; production records and market outlets with associated volume and price; aquaculture management practices and problems; characteristics of other farm and business enterprises, and their relationships to the aquaculture enterprise; and information on current decision processes and attitudes towards financial price, and production risk. Processors will be interviewed to collect information on their Facilities, costs of processing, and markets. A survey instrument (written questionnaire) will be developed for the producer and processor surveys. As part of the development process, the questionnaires will be pre-tested on a small sub-sample of respondents. Once data are collected, in addition to generating basic descriptive statistics, the data will be used in a quadratic programming economic-optimization model (outlined in a following task). For enterprises with technical problems identified during the initial interview, follow-up interviews including appropriate technical personnel from West Virginia University Extension or the Freshwater Institute will be scheduled to identify production constraints and develop recommendations on ways to enhance efficiency of the aquaculture operation. The process of identifying participants and development of the primary data will begin in March 1999 and is expected to be completed by December 1999.

Individuals across the state, including the president of the West Virginia Aquaculture Association and the manager of an aquaculture cooperative, will be contacted to solicit their support for the survey. While this does not necessarily guarantee producer and processor participation in the surveys, it will enhance survey response rates.

TASK 2-2: Assess the financial viability of a range of aquaculture enterprises including the effects of incorporating aquaculture as a diversification strategy for traditional agricultural firms.

Representative enterprises - and enterprise sizes - will be specified based on information obtained in the interviews, technical specifications of alternative enterprise structures, and available studies from other states. Start-up and operating cost estimates will be generated from data collected in Task 2-1 and from previous published studies. Based on past studies and preliminary discussions with industry representatives, it appears that the most common systems in West Virginia are gravity flow tanks with annual production ranging from 5,000 pounds per year to 30,000 pounds or more per year. Detailed budgets will be constructed and made available in hard-copy form for at least three alternative sizes of gravity flow tank systems: 5,000, 15,000 and 30,000 pounds of trout per year. The second common production system is the raceway system that usually is associated with production ranging from 30,000 to 50,000 pounds of trout per year. Two other systems in use are cage culture in ponds and recirculating systems. Budgets will be developed for this range of trout production systems as well as for potential new, innovative types of systems (as well as other feasible aquaculture species in the study area) identified during the course of this study. Completed budgets will allow potential aquaculture producers to compare costs and returns among the alternative systems and to make initial assessments of the range of returns to their own labor, management, and investment.

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¹A fist of current producers and processors, as comprehensive as possible, win be developed in collaboration with the West Virginia University Extension Service, the West Virginia Department of Agriculture, the Freshwater Institute, and the West Virginia Aquaculture Association. County Extension personnel will be major collaborators in developing contacts with each firm as they are: (a) knowledgeable of activities in their respective areas, (b) able to facilitate contacts with and the cooperation of producers, and (c) major users of the results of the proposed research.

The primary data developed in Task 2-1, in conjunction with the problems identified during the interview process, will be used to develop management guidelines that will improve economic efficiency and profitability for both current and future aquaculture producers. The enterprise budgets will be included in business plans and outlines of accounting systems necessary for adequate management and financial control of successful farm aquaculture enterprises and made available to producers and farmers as part of the technology transfer component (Objective 4) of this project. As part of a sensitivity analysis, the enterprise budgets will be used to assess the impacts of potential changes in market price trends and seasonal price variations on the profitability of small to medium-scale aquaculture enterprises. Using a standard farm management/production framework, production timing to take advantage of seasonal price variations will be considered in terms of effects on costs and revenues, and variations in input costs will be analyzed to determine their effects on profitability and management strategies.

The second part of Task 2-2 is to investigate the risk-return characteristics of aquaculture. From a farmer's perspective, aquaculture can either be a stand-alone activity, or it can be combined with existing production alternatives as part of a risk-reduction strategy. West Virginia agricultural producers, as a group, tend to be risk averse and certain aquaculture enterprises could potentially fit in well both with producers' resource endowments and their risk characteristics. For example, beef cow/calf producers (usually considered in the literature to exhibit varying degrees of risk aversion) typically have access to potentially clean and reliable water supplies for their cattle; thus, some existing farm ponds or other water sources could be adapted to production of food fish, fee-fishing, or other types of aquaculture enterprises.

The risk-return tradeoffs associated with a given enterprise can be quantified either in isolation or in conjunction with alternative enterprises. The latter can be accomplished within the standard quadratic programming (QP) (or portfolio analysis) fi7amework (Markowitz 1991). A QP model will be constructed to provide insights into producer decision-making as outlined below. The enterprise budgets to be developed as part of this task will provide the data to estimate this model. Data from the producer survey will be only one component that goes into estimation of the model. Additional data to estimate the QP model include historical information on aquaculture product prices and feed and other input costs; this information is available from published government sources (USDA, WVDA). A time frame that is long enough to reflect expected variability in aquaculture product prices/input costs will be selected. Information generated from the analysis include expected returns and level of risk (calculated as the standard deviation of expected returns) for aquaculture products (e.g.,, fee fishing and food fish) individually as well as in combination with other enterprises such as beef cattle. The QP analysis can be used to identify the optimal portfolio (one that minimizes an investor's risks for a given level of net returns) for different degrees of risk aversion. This can be accomplished by varying the parameter, lamda, in the General Algebraic Modeling System (GAMS) computing package (Thompson and Thore 1992). The approach illustrated in Teegerstrom et al. (1997) will also be employed here. In the unlikely event that sufficient data are not available to estimate a QP model, alternative models (such as a dynamic-stochastic simulation) will be explored. Including the results of such models, technology transfer (Objective 4) will enable producers to see the expected returns and associated level of risk for aquaculture products, individually or in combination with other enterprises, given different degrees of risk aversion (ranging, for example, from low to high levels of risk aversion). This information will be useful both to entrepreneurs considering entering or expanding aquaculture production as well as to existing agricultural producers interested in adding an aquaculture enterprise to their operation. Besides trout (which currently dominates West Virginia production), alternative species that will be considered in our analysis includes arctic char, and hybrid striped bass.

In addition to coordinating the individual tasks under this objective, this objective will be coordinated with the marketing work under objective I culminating in a descriptive analysis of the market for Appalachian-produced aquaculture output. We recognize that the specific study areas would likely be different for the marketing component (Objective 1) compared to the production component (Objective 1), with the latter being a sub-set of the former. Thus, the market radius for West Virginia-based aquaculture products, as proposed for the study, encompasses the eight states noted in the Objective I description. However, given site specificity, climatic and resource endowment considerations, the geographic boundary for assembling information on the production-related component is envisioned to be a sub-set of the study area proposed for the marketing component.

Existing enterprise budgets and related information from surrounding states will be assembled as an aid in developing budgets specific to West Virginia producers. In addition to assembling information from other states, selected experimental or demonstration sites and aquaculture farms in these states will be visited to obtain a first-hand look at alternative aquaculture production systems and obtain costs and returns data for possible adaptation to West Virginia conditions. Thus, we will employ a "tiered" approach to assembling the information, although the survey itself will be limited to West Virginia producers.

For a sustainable aquaculture industry to result, production can not be examined in isolation. Thus, aquaculture-related waste issues and the regulatory environment in which producers make decisions will also be examined. Results on potential waste quantities, disposal costs and social costs from a prior study of West Virginia aquaculture (Smearman, D'Souza, and Norton 1997) will be utilized to explore and estimate possible waste impacts under different production scenarios. Likewise, output, income and employment multipliers from previous West Virginia input-output studies can be used to illustrate the potential impacts of expansion in the aquaculture industry on the statewide economy. Together with waste issues, this should help illustrate the impacts of growth in the aquaculture production sector, in the process providing information for policy formulation and facilitating sustainable development of the sector.

TASK 2-3: Assess the economic and organizational feasibility of operating an aquaculture processing and marketing cooperative for small and medium-sized aquaculture producers.

Existing processing establishments in West Virginia will be interviewed to determine per unit costs of (a) processing fresh trout fillets, and (b) processing value-added trout products. These data will be analyzed to determine the factors which contribute to differences in processing costs among firms. The effect on processing costs of alternative facility, production procedures, and management scenarios will be considered. The additional costs incurred when processing value-added trout products will be determined for existing products and potential new products.

The protocol under which this will be examined is the HACCP seafood standards. Thus, any marketing strategy that includes on-far-m processing as a component win take into consideration the need for producers to adhere to HACCP guidelines. It is recognized that health regulations, such as those embodied in HACCP, may effectively prohibit economically-feasible on-farm processing of fish by small- and medium-sized aquaculture producers. Nevertheless, the costs of setting up processing facilities that meet state and federal standards will be documented and the per unit health regulation costs of various sized enterprises determined. If these costs turn out to be prohibitive for individual producers or smaller size producers, alternative processing/marketing channels win be identified and per unit processing and marketing costs established and compared. One alternative that will receive emphasis in the research is a producer-owned processing and marketing cooperative business organization. These businesses exist to benefit member producers and operate at cost by returning any profits to their members in proportion to their use. The special organizational requirements of cooperatives will be explored to determine their feasibility. The Rural Business Cooperative Service of the USDA will be consulted to develop relevant organizational and financial operating information for aquaculture processing and marketing cooperatives.

On-going discussions with the Mountain Aquaculture and Producers Association (MA & PA) provides an initial case study. MA & PA has been processing and marketing trout products for a limited number of aquaculture producers in West Virginia since 1992. The continued collaboration of the manager and members of this cooperative will be sought to determine operating costs and to document the organizational, operating, and marketing experiences of the cooperative in terms of successes, failures, and opportunities. This information will be used to assess the financial and organizational feasibility of cooperative business arrangements for West Virginia and Appalachian producers. If a cooperative is found to be feasible, a model organizational and business plan will be developed.

Objective 3. To determine the effect of water quality and stress on the consistency and quality of fresh trout fillets and value-added smoked trout products.

Expected Outcome: Increased use of trout as a commodity and improved consistency, quality, and value of fresh trout fillets and value-added trout products by characterization of handling practices and water quality in production system prior to and at harvest.

Personnel: Scientists primarily responsible for accomplishment of Objective 3 are P. Brett Kenney and Patricia Mazik. Frank Saus (subcontractor with National Research Center for Coal and Energy) will perform certain water analyses.

Justification: There is a need for defining the impact of production parameters and fish handling (ante- and postmortem) on the quality of muscle food derived from farmed fish produced on small to mid-sized operations. Consistent with regional boundaries (NC, KY, VA, WV, OH, MD, PA, and NY) described in objectives I and 2 of this proposal, the size of operations in this region are not such that a large supply of consistent quality fish could be provided from any one producer.

However, in a cooperative marketing structure, this size constraint may be overcome to supply fish to niche markets that exist in Washington, DC and Baltimore, MD population centers. The centralized processor would address requirements needed for approval of the processing facility, Standard Sanitation Operating Procedures (SSOPs), and a Hazards Analysis Critical Control Points (HACCP) plan which is an advantage for each participant in the coop. Nonetheless, individual producers would have responsibility for on-farm handling of fish prior to arrival at the processors, which impacts overall HACCP plan. Because several producers would participate in this marketing approach, it is likely that management and handling practices will vary in the late antemortem and early postmortem period affecting the quality of fish received by the co-op. It is imperative that a plan is developed that addresses critical factors in production and handling which impact quality to assist the processors in insuring that the raw material they receive is consistent. Additionally, it is critical that a marketing cooperative supplies a steady volume of consistent quality product. This marketing approach is problematic in that a variety of production and harvest practices could result in highly variable raw material for value-added product applications. Because there is limited information on the relationship between the stress response of cultured-fish and its impact on muscle quality, characterization of water quality (animal environment) effects on stress response is needed. The subsequent impact of stress response on quality of muscle is relevant to the functionality of fish muscle in fresh- and further- processed product applications. Because conditions in the cultured-fish environment may be very different from the wild-caught fish environment, linking research that deals with wild-captured stocks (Jerrett et al., 1996; Lowe et al., 1993) to cultured fish may be unfounded. However, research on wild-caught fish establishes precedence for evaluations of factors affecting early postmortem events as important to the ultimate muscle-food quality. Connective tissue of fish is susceptible to temperature and physical abuse. As an example, muscle fibers can separate from the connective tissue interface of the myocommata, and this quality defect or undesirable separation is referred to as "gaping". It is important that the onset of rigor mortis is gradual in order to minimize the occurrence of gaping. Processing of fish should occur before the onset of rigor to minimize tearing during filleting operations. Research (Jerrett et al., 1996; Lowe et al. 1993) demonstrates the importance of minimizing stress in the harvest or capture of food fish. Lowe et al., (I 993) indicated that stress imposed by fish harvest and handling impacts postmortem fish quality. Reducing practices that cause depletion of endogenous energy stores prior to death would likely provide better quality flesh. These data indicate that it is the control of rigor onset that is particularly critical to avoiding poor quality attributes such as gaping.

Data collected recently in our lab indicate that fish maturity (gravid v. nongravid) and feed withdrawal affect meat pH. This is perhaps the most important variable affecting raw material functionality, in particular texture development, in further-processed trout applications such as smoked product. Rate of pH change is also indicative of rate of postmortem metabolism and rigor onset. There is limited information that the small to mid-sized aquaculture producer can apply to maximize production of a consistent quality raw material. Animal and environmental factors affecting metabolism of post-harvest muscle merit characterization in cultured fish, trout in this case. The information will be valuable to the cooperative processors, and this knowledge will provide product confidence as the cooperatives address Niche market opportunities.

TASK 3-1: Determine the influence of managing, harvesting, handling and processing practices on the yield and quality of fresh trout fillets.

This objective will determine the effect of production, harvesting and handling practices on fresh and further processed rainbow trout from aquaculture operations in the Appalachian region of the mid-Atlantic.

To evaluate water effects, water samples will be collected for mineral analyses. We hypothesize that the animal's efforts to maintain mineral homeostasis is stressful and that this chronic stress will impact early postmortem metabolic events, thus altering the ability of muscle to retain inherent moisture in fresh and further-processed food applications. Mineral analyses will provide data to establish the relationship between mineral content of the water and indicators of animal stress and muscle quality. If mineral composition and content are less than ideal for fish growth, this stress will affect the conversion of fish to food at harvest.

Fish and water will be sampled from twenty-five aquaculture producers in the region (B 75% of current producers). Water, fillets and blood samples will be processed as described below. Fifty fish will be sampled pre- and post-harvest at each farm. To establish a link to trout production practices by small- to mid-sized producers and to facilitate technology transfer, preliminary industry surveys will be performed. Fish health, nutritional management, and genetics information will be requested from each collaborator. Production system, water source, nutrition, handling prior to harvest, and harvest practices will be noted and considered in evaluations of muscle metabolism and quality. We will attempt to develop collaborations with different farms that have the same water supply and with single farms that have different water supplies. An additional criterion is that farms are using the same feed. Water quality parameters (oxygen, temperature, pH nitrite, ammonia, total dissolved solids, nitrate, hardness, suspended solids, CO. alkalinity, acidity) will be measured by each collaborator during the month prior to harvest.

In addition to the aforementioned water quality parameters, the following mineral analyses will be performed:

Dorsal Musculature	Water	Feed
Ca, Mn, Zn, Mg, Cu, Fe, Fe2+	Fe, Mn, Al, Ca, Mg, Hg, pH, alkalinity, acidity	Zn Cu, Ca, Mg, Mn

Fish will be bled using heparinized syringes from arteries in the caudal peduncle. Fish will be stunned using clove oil. All fish will be bled within 5 minutes of initial disturbance and each fish will be sampled only once. Blood will be centrifuged and plasma stored at -55E C until analyzed. Plasma concentrations of cortisol, the dominant corticosteroid in fish (Donaldson, 1981), will be determine d by radioimmunoassay (RIA) with a commercially prepared kit (Ciba- Corning Diagnostics Corporation, Medfield, MA). Plasma glucose will be determined using a clinical diagnostic kit (Sigma Chemical Company, St. Louis, MO) and plasma chloride levels win be determined using a chloridometer (Buchler Instruments, Lenexa, KS).

Fresh and Value-Added Product Manufacture, Quality, and Functionality Assessments

Fresh Fillet Evaluations. Fillet yield will be calculated for each fish from each producer. Fresh fillets will be graded according to the Code of Federal Register (50 CFR, Ch. I 1, Part 260) entitled, "Regulations Governing the Processed Fishery Products and US standards for Grades of Fishery Products'. Fresh fillet color will be measured using a Minolta chronometer when graded at 0, 24, 48, and 72 h following filleting.

Expressible moisture of fresh fillets will be measured according to procedures of Jauregui et al. (1981). This trait will indicate the water retention ability of post-harvest trout muscle.Color, cook yields, texture, protein-water interactions (water binding potential, expressible moisture, protein solubility) and proximate analyses (moisture, protein, fat, and ash) will be evaluated in fresh and value-added products to determine the impact, if any, of water characteristics on trout muscle functionality.

Smoked Trout Evaluations. Investigations of the impact of fillet quality on smoked trout will be determined using a two-stage brining protocol. Stage one will consist of subjecting fish to brine containing 8.7 % NaCl for 90 min at 3EC. Based on recent work in our lab, this concentration/time combination resulted in optimal texture development and greater than 3.5% water-phase salt in the finished product. Stage two will consist of removing fillets from brine and allowing the salt to equilibrate for 48 h. Following removal from the brine and prior to storage for equilibration, fish fillets will be weighed and weights will be recorded in order to determine brine uptake. Muscle pH of fresh and brined fillet will be measured at the cranial, middle, and caudal third of each fish using a surface probe. Prior to thermal processing, a sample will be removed from one fish for protein solubility determination and myosin and actin quantification using sodium dodecyl sulfate-polyacrylamide gel electrophoresis (SDS-PAGE). The remaining fish will be weighed to determine cook yield. Fish fillets will be placed on smoke racks and thermally processed in a microprocessor-controlled smokeoven (Model CVU490; Enviro-Pak, Inc.; Clackamas, OR). Following thermal processing to an internal temperature of 65EC, fish fillets will be weighed and vacuum packed for texture analyses.

Proximate analyses will be conducted for fresh and smoked trout using standard AOAC (I 990) procedures. The pH measurements will be carried out using a pH/Ion analyzer (Corning, Inc.; Coming, NY). Proteins will be extracted using 2% NACL and extract pH will subsequently measured using the procedure described by Nayak et al. (I 996). Characterization of soluble proteins will be carried out by SDS-PAGE, and actin and myosin will be quantified as described in an earlier report (Nayak et al., 1996) using video-image analysis of gels. Expressible moisture will be measured according to Jauregui et al. (198 1). Percent NaCt will be determined using QUANTAB Chloride Titrators (Environment Test Systems, Inc., Elkhart, IN). Cook yields will be determined based on weights prior to and following thermal processing. Brine uptake will be evaluated based on weights of fresh fish and brined fish prior to thermal processing.

Model System Evaluations. A trout mince will be prepared from each fish fillet within each lot of fish evaluated from a specific operation in January, April, July, and October of each calendar year. Either 2.0% NaCl or 2.0% NaCl and 0.4% sodium tripolyphosphate (STPP) will be added to 3 00 g of ground trout muscle. A water addition of 10% will be used in each evaluation. Water, ingredients, and ground trout will be chopped in a Cuisinart food processor (Model DLC-8K Cuisinart Corp., NJ) for a total of 45 sec. Chopping will be interrupted at 15-sec intervals to scrape the sides of the bowl. Following chopping, pre-blends will be vacuum packaged and held for 12 h at 4EC. After 12 h, each batch will be stuffed into three, 2.8 cm dia. polypropylene centrifuge tubes and heated to an internal temperature of 65EC. Internal temperature will be recorded at one-minute intervals on a temperature recorder (Model 205 Datalogger, Beckman Industrial, Carlco Inc. Overland Park, KS). Gels will be cooled to room temperature, and 3, 12.7 mm thick X 19.1 mm diameter cores will be removed from each cooked trout gel. Using an Instron Universal Testing Machine (Model TM), each core will be Daily compressed at 127 mm/min to 501/o of its original height for two cycles. Gel hardness (Bourne, 1978; peak force of the first compression) and cohesiveness (energy of second compression as a percent of energy of the first compression) will be determined. A portion of the raw batters will be extracted with either a 2.0% NaCl or 2.0% NaCl and 0.4% STPP solution that mimics the concentration of these ingredients in the aqueous phase of the raw batter. Total soluble protein and myosin will be determined. Myosin will be separated from total soluble protein using SDS-PAGE. Gels will be stained with Coomassie blue, and following de-staining, the gel image will be captured for evaluation by the Optimas image analysis system (Optimas Inc., Edmonds, WA). The gels will be scanned and individual bands of myosin quantified against a standard amount of myosin loaded in a reference lane. In addition to myosin quantification and to provide a more thorough characterization of protein changes, differential-scanning calorimetry will be used to develop endothermic peaks for soluble proteins. Because protein-water and protein-protein interactions are significant to the functionality of muscle foods, any differences in the utility of the raw material from different operations will be rationalized on the basis of differences in these functional traits assessed by SDS-PAGE and differential scanning calorimetry.

Manufactured Steak Evaluations. Technology for manufactured trout steaks will be adapted from restructured beef technology described by Kenney (1990). Undersized and perhaps oversized fish will be filleted and skinned. Five kilogram batches will be made; sodium tripolyphosphate (0.4%) will be added and the product will be mixed for 15 minutes. The raw product will be stuffed into No. 6 fibrous, pre-struck, easy-peel casings (Viskase Corp., Chicago, IL), frozen in a -20E C freezer, and subsequently sawed into 1.27 cm steaks. Without thawing, these steaks will be individually vacuum-packaged and returned to the freezer until cooking for texture evaluation. Four steaks will be thawed, and weight will be recorded before and after cooking to an internal temperature of 65E C. Trout steaks will be cooked on a Farberware Smokeless Indoor Grill (Model 4400; Farberware, Inc., Bronx, NY). Cook yields will be recorded and steaks will be subjected to two texture evaluations. Three 3.81 cm dia. cores will be removed from the center of the steak and subjected to compression testing using an Instron Universal Testing Machine (Model TM- Instron Corp., Canton, MA). Each core will be axially compressed at 127 nun/min to 50% of its original height for two cycles in order to determine hardness and cohesiveness. Additionally, a 4 cm' section will be removed from the center of the steak and sheared. A combination of these measurements will allow us to determine the degree of particle-to-particle interaction. These evaluations will be particularly important in relating management practice to muscle quality and muscle quality to raw material functionality in a fresh manufactured trout steak.

These studies will address the effect of water quality characteristics as potential stressors on rainbow trout and fillet quality. Initial experiments will evaluate the effect of 3 sub-lethal levels of nitrite, ammonia, temperature and water hardness on the stress response and quality of trout muscle. Preliminary experiments will be conducted to determine the three sub-lethal levels of each water quality variable to be used. Trout for the experiments will be maintained in three 500-L tanks. Each of the experimental treatments, nitrite, ammonia, temperature, and water hardness, will be studied separately. With nitrite as the example, the low, medium, and high level of nitrite and a control will be replicated 3 times, requiring twelve, 100-L tanks. This approach will be used for each of the four treatments. Water quality parameters (oxygen, temperature, pH nitrite, and ammonia) will be measured daily in each tank during the experiments. All experiments will be conducted in flow-through systems. Temperature will be controlled by chiller or heater units. Ammonia and nitrite will be maintained by adding chemicals with a peristaltic pump. Three reservoirs will be used to maintain the low, medium, and high dose. Water and chemicals will be pumped to the reservoirs, mixed and then gravity fed to the experimental tanks. Dr. Mazik has maintained ammonia levels for 30 days in this manner. For each treatment, 30 fish, weighing approximately 300 grams, will be randomly transferred to each of the twelve 100-L tanks. Each treatment will expose fish for 3 weeks. Ten fish will be sampled (blood and fillets) every seven days. Water level in each tank will be lowered following sampling to standardize fish density. Initial or 0 hr samples (blood and fillet) will be taken of 10 additional fish. Fillets will be processed, and quality and functionality will be assessed as described in Phase 1. Blood indicators of stress will be measured as described in Phase 1.

Postmortem Metabolism. Postmortem metabolism will be assessed at the time fish are sampled. Muscle pH will be monitored in five fish per tank with a pH/ion analyzer (Model 350, Corning Inc., Corning, NY) equipped with a needle probe. The pH probe will be placed in the dorsal musculature, just caudal to the head. Temperature will be recorded with a Doric data logger (Model 205, Beckman Industrial, Carlco, Inc.; Overland Park, KS) at a position in the musculature next to the pH probe. Placement of pH and temperature probes will alternate from left to right sides of the musculature. Temperature and pH measurements will be taken every minute for a 1.5 h period. Rate and extent of pH changes, as a function of temperature, will be determined for use in evaluating the significance of these traits to processing quality of smoked trout fillets and restructured trout steaks. Because muscle's attempt to maintain ATP levels and thus cell viability modulates postmortem changes in muscle, ATP/EMP ratios will be determined according to the procedure of Khan and Frey (I 97 1). ATPDW measurements will be taken every 0.25 h for 1.5 h and then at 6, 12, and 24 h post-sampling. Sampling will be conducted as described by Korhonen et al. (1990); a 10 gram sample of dorsal musculature will be excised from 5 separate fish collected at the same time as those used for pH and temperature decline studies. Tissue will be collected from an anatomical location similar to where the pH and temperature were measured. Following sample preparation, absorbency will be measured using a Shimadzu LTV-1201 spectrophotometer (Kyoto, Japan) at 250 and 280 nm. Our samples will be blended with perchloric acid and then analyzed.

Objective 4. Conduct a technology transfer component to disseminate information generated by this project to the aquaculture industry in Appalachia, to state agencies with aquaculture-related responsibilities, and to the general public.

Expected Outcome: An appropriate technology transfer component that disseminates the results of this applied research will significantly improve opportunities and profits from aquaculture enterprises in rural areas.

Personnel: Scientists primarily responsible for coordination and accomplishment of Object 4 are Richard Zimmerman and Kenneth Semmens.

TASK 4-1: A technology transfer component for the proposed research will be implemented to deliver information to the aquaculture industry that has been generated by the research accomplishments in Objectives 1-3.

Researchers from this project will team with the Freshwater Institute Aquaculture Program, the West Virginia Department of Agriculture (WVDA), and with West Virginia University Extension Service (WVUES) to deliver research findings in the most "user-friendly" manner possible. County agents will be utilized to facilitate contacts with industry participants and on-farm data collection. A committee of WVUES specialists and county agents will lead the development of educational materials from the research results. This committee will also plan and deliver two training programs for industry and agency personnel. Workshop participation will include project researchers, WVDA, and WVUES specialists.

A training program for aquaculture processors and state agency personnel will address information regarding guidelines for maintaining processed product quality and consistency as identified by research conducted under objective 3. Training materials for this workshop include a reference manual for producers and processing plant employees. Best aquaculture management practices including on-farm harvesting and handling of fish, transport of fish to processing centers, and processing practices will be discussed. A second training program will target aquaculture farm management issues including aquaculture enterprise budgets, recommendations for management practices to improve efficiency and cost effectiveness of aquaculture enterprises, and the financial viability of aquaculture in combination with other fan-n enterprises. Additional information regarding potential markets and recommendations for marketing strategies WM be addressed. The training content will focus on information generated from Objectives I and 2 of the project. Industry training programs developed as part of this project will be advertised through regular industry channels including the web page for the West Virginia Aquaculture Association, the national Aquaculture News monthly newspaper, and the newsletter for the Northeastern Regional Aquaculture Center, "Northeastern Aquaculture".

Investigators will also collaborate with Extension personnel in the development of Extension publications to facilitate technology transfer. This includes publications discussing the potential for the live fish market in West Virginia, potential markets for live and processed trout products in the region, publications detailing capital and operating budgets for small to medium-scale aquaculture productions systems, recommended best business management practices for aquaculture producers, and enterprise budgets for small to medium-scale aquaculture operations. An Extension publication detailing best management practices to ensure product quality is also anticipated.

A viable, competitive Appalachian aquaculture industry requires efficient, well-managed production Facilities, high quality processing Facilities that meet or exceed mandated standards, and a high quality aquaculture product at a competitive price. This proposal identifies constraints to the development of an Appalachian aquaculture industry and outlines research strategies to help overcome these constraints.

Based on available water supplies, current technologies, and the characteristics of local firms and businesses, small- to medium-sized aquaculture operations, rather than large-scale ones, are expected to be the dominant factor in the aquaculture sector of central Appalachia. One reason for growing interest in small-scale aquaculture is the continuing decline in the economic viability of traditional small farm agriculture across the state and the region. As recently noted by Gempesaw et al.(1995), "Small scale aquaculture operations can have an important role in contributing to the sustainability of rural America through the preservation of natural fisheries, efficient utilization of water and land resources, and the provision of alternative income and employment for the small farmer."

Geographic location also supports the rising interest in aquaculture. The Northeast Region of the U.S. encompasses the area of highest seafood consumption in the country. According to a recent study, two of the top five seafood consumption centers in the U.S. are Washington, D.C. and Baltimore, Maryland (O'Dierno and Gall 1995). Both of these cities are located within a five- hour drive of North Central West Virginia. The ability of small aquaculture producers to access these large market centers, however, is heavily constrained by the need for relatively large and consistent supplies of a quality, processed aquaculture product produced at competitive costs. An impetus for targeting markets that carry processed fish products is apparent due to the increased profit margin that can greatly impact the economics of small scale production. Growing concerns over food safety and quality issues and the recent advent and enforcement of Hazard Analysis Critical Control Point (RACCP) regulations for processing and adding value to fish products has created a need for research on, and identification of, processing practices that will improve the quality of processed fish products for a small-scale industry.

A final reason for the rising interest in aquaculture is the increase in the numbers of live fish marketed through recreational fishing industries such as the fee-fishing industry. The fee-fishing, or pay-lake industry has been steadily expanding in West Virginia over the last six years and currently represents a significant market for rainbow trout produced by small-scale aquaculture producers. This research includes studies to identify the market potential of both live fish sold for recreational fishing and for processed products produced in the region. Determination of the potentials of these markets will in part, determine the potential for success of a small-scale aquaculture industry in the region.

The approach taken transcends traditional disciplinary and college boundaries and can uniquely provide the research base and cross-cutting information needed by the aquaculture industry to overcome some of the major constraints to growth in Appalachia. The collaboration of the Freshwater Institute and the educational expertise of the West Virginia University Extension Service will enhance the overall scope of this project and create a solid foundation of information for a new and growing industry within the region.

In order to develop long-term viability, producers of products or services, must identify a sustainable competitive advantage and strategically focus their attention on maintaining that advantage in the marketplace. The development of a successful and sustainable competitive advantage is predicated on the analytical development of several interdependent strategic marketing initiatives (Porter 1985). One of these initiatives is a market needs assessment. In the case of regional aquaculture, this needs assessment would include the Appalachian aquaculture customer base including potential buyers in both distinctive segments (fee fishing and food fish markets) and at the various levels of the distribution structure for each (Wessells et.al. 1994). A competitive analysis of both segments is also required. The competitive analysis involves both direct and indirect industry competitors as well as potential entrants and substitutes (Porter 1990).

Upon completion of both the market needs assessment and the competitive analysis, a marketing strategy can then be developed (Schnaars 1998). In order to be effective, the marketing strategy must incorporate the results of both the market needs assessment and competitive analysis. The strategy should also incorporate the production and operating cost-related information (Keenum and Dillard 1984).

After the marketing strategy has been developed, a marketing plan, outlining operational alternatives can then be designed (Jain 1997, Lehmann 1996). The marketing plan will provide alternatives for both current and potential producers and provide a directional roadmap for these producers to market their aquaculture products. In sum, the marketing strategy and plan should ask and answer three important questions as they relate to the marketing of Appalachian aquaculture products. These are: (1) Where is the Appalachian aquaculture industry now? (2) In what direction should it go? and (3) How does it get there? (Kerin et al. 1990). By asking and answering these questions a sustainable advantage can be identified and a strategic focus implemented.

Cost-of-production estimates have been extensively developed for catfish production in the Southern portion of the United States. Giachelli, Coats, and Waldrop (1982) used the economic-engineering approach to synthesize three different sized production systems for catfish in Mississippi and developed investment costs, annual ownership costs, and annual operating costs for each system using standard budgetary techniques. Giachelli and Waldrop (1983) extended the analysis to include cash flow budgets for producing catfish. Boucher and Gillespie (1998) developed cost and revenue budgets for crawfish and catfish production in Louisiana using producer survey data. Three different crawfish and four different catfish production-marketing situations were considered in the analysis.

Hinshaw, Rogers, and Easley (1990) developed budgets for trout production in the South.These budgets were based on operating cost and prices obtained from a survey of North Carolina farmers. Establishment and annual operating costs were developed for new and experienced producers on small (less than 100,000 pounds per year) and large (more than 100,000 pounds per year) farms. Total costs per pound ranged from a high of $1.07 to a low of $0.82. Jenkins, Wade, and Yohn (1996) analyzed a small scale, partial reuse trout production system in West Virginia and developed start-up costs and breakeven prices for the facility. Engle and Stone (1997) developed a model business plan outline for aquaculture producers seeking loans to establish or expand their enterprises. Financial data of the type presented in the above budgetary studies is needed to develop the required business plans.

Teegerstrom et al. (1997) use a combination of decision theory and portfolio analysis to show that contract grazing of beef cattle can offer added profits and lower risk, in comparison to more traditional cow-calf operations. Details on portfolio theory can be found in Markowitz (1991; details on estimation of portfolio models can be found in Thompson and Thore (1992).

In any food animal specie, the conversion of muscle to meat consists of a complex set of events initiated because oxygen is no longer available to muscle for support of oxidative metabolism. Even though oxygen is no longer available for generation of adenosine triphosphate (ATP), muscle attempts to maintain homeostasis and thereby generated ATP from phosphocreatine via creatine kinase and from muscle glycogen via glycolysis. There is a concurrent accumulation of lactic acid in muscle as ATP is generated. It is the rate and extent of this accumulation that affects normal and abnormal conversion of muscle to food. If the rate of buildup is rapid while carcass temperature is high, poor quality meat results.

The connective tissue of recently harvested fish is susceptible to temperature and physical abuse. Thus, muscle fibers are susceptible to separation, and this quality defect is referred to as "gaping". It is important that the onset of rigor mortis is gradual in order to minimize the occurrence of gaping. Processing of fish should occur before the onset of rigor to minimize tearing during filleting operations. Research (Jerrett et al. 1996; Lowe et al. 1993) demonstrates the importance of minimizing stress in the harvest or capture of food fish. Lowe et al. (1993) indicated that stress imposed by fish harvest and handling impacts postmortem fish quality. Reducing practices that cause depletion of endogenous energy stores prior to death would likely provide better quality flesh. These data indicate that it is the control of rigor onset that is particularly critical to avoiding poor quality attributes such as gaping. More recently Ca⁺² and Zn⁺² transported in the gills of rainbow trout have been evaluated (Hogstrand et al. 1995). They demonstrated that changes in influx characteristics of Ca⁺² and Zn⁺² were correlated with physiological alterations. Protein turnover in the gill was increased with increased mineral content, and growth rate was depressed.

Variations exist in the quality of fish from various aquaculture operations. Processing protocols for smoked trout and other products will be tailored to optimize the utility of trout raw material with different functionalities that result from different management and pre-harvest handling practices.

The physical facilities of West Virginia University will be utilized for developing, analyzing and reporting the study. Facilities of the College of Agriculture, Forestry and Consumer Sciences and the College of Business and Economics will be utilized for Objectives I and 2. Personal computers (IBM compatible) provided by the institution will be used in implementing this process. The returned questionnaires will be coded, entered and stored on a Den Dimensions XPS P90 Intel Pentium Processor computer and analyzed using the SAS software package. This equipment has proven to be both expedient and precise in analyzing similar data collected in prior studies.

The procedures of Objective 3 will utilize the facilities of the Division of Animal and Veterinary Sciences at West Virginia University. Pertinent to these studies are a meat processing lab (1100 ft²), meat chemistry lab (750 ft²), coolers (940 ft²), and a walk-in freezer (150 ft²) . The meat-processing lab is equipped with a grinder, meat stuffer, band saws, mixers, and stuffers. A Griffith mincemaster emulsion mill, Hobart bowl mixer, and microprocessor controlled smokehouse is available. Additionally, an Instron Universal testing machine (Model TM), interfaced with data acquisition hardware and signal processing software is available for texture analysis. The meat chemistry lab is equipped with water baths, Beckman spectrophotometer, Minolta chronometer, drying oven, vertical slab gel electrophoresis unit, Goldfisch and Soxhlet fat extractors, and an ashing oven. We have access to a Tecator digestion and distillation unit for Kjehdahl nitrogen determinations.

Water and mineral analysis proposed in Objective 3 will be done in conjunction with analytical laboratory at the West Virginia University National Research Center for Coal and Energy. The laboratory is EPA certified for performing analysis under the National Pollutant Discharge Elimination System of the Clean Water Act. AU analytical methods are EPA approved and have a standard Quality Assurance/Quality Control protocol. The laboratory was recently awarded an analytical contract for water inorganics by the West Virginia Department of Environmental Protection for mining and reclamation projects. The laboratory is in close proximity of those of the Division of Animal and Veterinary Sciences and will most likely lead to additional collaborative efforts between the two organizations.

Plans are being developed for the addition of an aquaculture research lab through renovation of existing facilities. Water chillers, drainage, walk-in coolers, and good water supply are already present at the site, which is located in the Agricultural Sciences Building on the Evansdale Campus of West Virginia University. The lab, to be composed of two large rooms, will have an analytical room and a fish rearing and holding room. A loading dock, allowing easy transfer of fish, is directly accessible from the lab site.

Gerard E. D'Souza. Dr. D'Souza will have primary responsibility for developing and estimating the QP model and conducting related economic/financial analysis. In addition, he will collaborate with the other agricultural and resource economists and the marketing specialists on the team, assisting in development of (a) enterprise budgets and performing related farm-level analysis of costs and returns, and (b) the marketing studies. He has previously performed economic studies in aquaculture in West Virginia. Budgeted time commitment is 17%.