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Marifarms, Inc. (1968 to 1982)
Marifarms, Inc., the first industrial-scale shrimp farm in the world (hatchery, impoundments, ponds, feeds, patented technology, government loans, scientists and investors), got started in Florida, USA, in 1968, and went out of business in 1982. The original strategy was to stock an enclosed bay with shrimp and then use commercial fishing techniques to harvest the crop. Later, the strategy changed to farming shrimp in huge ponds.
In Memoirs of a Shrimp Farmer, a 200-page, paperback book, John Cheshire, the manager of Marifarms from beginning to end, tells the farm’s story in short, year-by-year chapters interspersed with black-and-white photographs, maps and press clippings.
Cheshire received a bachelor’s degree from Yale University and a master’s degree from the Massachusetts Institute of Technology (MIT), both in chemical engineering. He also received a master’s in business administration from Harvard University in 1951. He was Marifarms’ financial officer and later its chief operating officer.
The research for Marifarms was done by the Japanese from 1930 to 1968 and by the commercial development of Marifarms, Inc., from 1968 to 1982.
Excerpts from Cheshire's Memoir
“This book is dedicated to my wife, Julie, the love and treasure of my life; to the investors of Marifarms, Inc., who ventured into the unknown and helped develop a giant new industry; and to the loyal employees of Marifarms, Inc., who were with us to the end.”
“It should be long past the time when I gave much thought to shrimp farming since I left that endeavor some 23 years ago and I am now at the ripe old age of 79.” [Cheshire’s memoir was published in 2005.]
“With encouragement from my wife Julie, who has invested much of her life and extensive personal holdings in the enterprise of shrimp farming and other friends and associates who have done likewise, but not perhaps to the same degree, I feel obligated to give an account of how this great new industry began and our role in it. I am sure the stockholders of Marifarms, Inc., the company we started together, will be interested in this account because at its peak there were eleven hundred of us and virtually all who did not sell out lost their total investment.”
“I have presented the story in the form of a yearly report. The reason for this is that we were never sure if the progress in one year would justify investors risking money for the next year.”
“Early in 1968, Dr. Paul Bente, my boss at DuPont, asked me to attend a meeting with a group of Japanese marine scientists who had an interesting business proposal. Our group in the development department of DuPont was set up to investigate and launch new businesses. Dr. Bente, a chemist with extensive research experience, headed our group; Dr. Russell Peterson, later governor of Delaware, was his boss. Though small, our group represented powerful interests within DuPont.”
“The meeting was introduced by Aki Kawaguchi, a young businessman from Tokyo; Dr. Mitsutaka Miyamura, a VP of Taiyo Fisheries; Lieutenant Colonel Joe Ikeguchi; and Lieutenant Colonel Mike Alba. The latter two were officials of a new company chartered in the USA named Akima International (‘Aki’ for Aki Kawaguchi and ‘ma’ for Mike Alba). It was represented at this meeting that Aki Kawaguchi and Mitsutaka Miyamura had acquired the patent rights for shrimp cultivation from Dr. Motosuka Fujinaga and that Dr. Miyamura had applied for a USA patent on those rights in the name of Akima International. Documents covering these transactions were presented. Further, a survey of the eastern and Gulf coasts of the USA had been made by Dr. Fujinaga, and Panama City, Florida, was chosen as the most desirable of several potential sites for a farm.”
“We were struck...by the huge potential of the project. The technology was unique, original and appeared patentable. The market for shrimp was booming.”
“Conservative heads prevailed at the DuPont Company. When this project was reviewed by higher authorities, it was decided that though interesting, the company could not proceed on the basis that the product was ‘alive’ and hence involved unknown risks. The project was outside DuPont’s business experience. We were deeply disappointed at the time and considered the rejection a sign of aging management.”
“Brushing aside misgivings, Paul Bente and I decided something had to be done and that we were the people who had to do it. We were both in our mid to late forties and ready for new and greater challenges than DuPont was prepared to offer. So we decided to go for it. We had investigated many projects together, none with the potential of this one. He was risking a solid career and reduced pension rights at DuPont. I had built a career at DuPont and had accumulated some $200,000 through inheritance and investments. I wasn’t worried about survival and knew Julie would be fine whatever happened. She had considerable independent assets.”
“Paul and I then called Aki Kawaguchi, the spokesman for the Japanese group. We told him the DuPont Company had turned down the deal, but that he and I would put up $200,000, which we would share equally for 50% of Akima International. He agreed, and we were off. Although neither Paul nor I had any qualifications for running a fishing or farming company, we were undertaking a project that DuPont, Taiyo Fishing and the government of Japan had rejected. We were exhilarated.”
“In 1969, we acquired a one-acre lease from the Panama City Airport Authority on the shore of St. Andrews Bay and constructed a small hatching facility consisting of one concrete tank near an existing shed, within which some rudimentary tanks were built for growing plankton and the preparation of other hatchery feeds. Nearby was Little Goose Bayou—which Dr. Fujinaga had proposed as an experimental growout area. It had a narrow neck that could be easily netted off and was rich in natural foods. While he had never tried open water growout before, his prior experience being with small ponds, he visualized this as a cheap and perhaps better way to grow shrimp than ponds.”
“By the end of the first year, we were out of money, but not enthusiasm. Paul and I both were still employed at DuPont. We put in another $200,000 for a bigger stake in Akima International. The technology was now legally ours, and the experimental hatchery had started successfully.”
“By 1974, our team had developed a close relationship with Ralston Purina, which was operating an experimental shrimp hatchery in Cedar Key, Florida. The research team there was headed by Dr. William MacGrath, Harvey Persyn, Ron Staha and Joe Mountain, all competent marine biologists who developed into wonderful and loyal friends. Marifarms was to depend on them in the future for nauplii, which we could not find anywhere else.”
“In 1981, Ecuador showed the world that farmers could capture wild postlarval shrimp, stock them in ponds and produce a profitable crop of large shrimp. But many of the ponds that were constructed for shrimp farming were lying idle because wild seedstock was not always available. There was a crying need for a shrimp hatchery in Ecuador.”
“I started looking for a partner in Ecuador.”
“A reasonable candidate appeared to be National Protein, traded on the American Stock Exchange with an operating division in Ecuador called ‘Empacadora National’, which harvested and sold tuna and shrimp. It also owned a small shrimp farm near Machala, so the fit seemed excellent for us. We met the Empacadora Nacional president whose name was Harry Graham. His credentials seemed fine. His father was from North Carolina and his mother from Peru. Although Latin in appearance, he spoke English like an American. One of his brothers ran a hospital in Chicago, and his son Jeffrey graduated from Davidson College.”
“A team from Empacadora visited us in Panama City. The men were Harry, Jeffrey, a biologist named Pepe Plans, and an important shrimp grower named Esteban Quirola. Esteban wanted to build a farm on Isla de Puna, an enormous island in the mouth of the Guayas River. All spoke glowingly of the possibilities for farm expansion—if there were a good source of seedstock.”
“We immediately drew up a contract for a hatchery, awarding 49% ownership to Marifarms, Inc., and 51% to Empacadora, a condition dictated by Ecuadorian law. Empacadora was to advance $100,000 and Marifarms $20,000, the balance to be credited to Marifarms based on its technical expertise. The agreement called for Marifarms to design, build and operate the hatchery.”
In 1982, when its hatchery project in Ecuador failed, Marifarms went out of business. Cheshire said, “It was a cliffhanger all the way. We only quit in the end because we had exhausted ourselves, our money and, more importantly, our ideas.”
Source: 1. Memoirs of a Shrimp Farmer. John Cheshire. Florida, USA, 2005. 2. Excerpts by Bob Rosenberry, Shrimp News International. October 21, 2006. 3. Updated by Bob Rosenberry, Shrimp News International. March 9, 2017.
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