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Salmon carcasses are what's left of the fish after processors turn the flesh into fillets or steaks.

Kake Foods, a wholly owned subsidiary of Kake Tribal Corp., used waste from the fish it processed in 2002 to produce an organic fertilizer.

"Old-timers used to just dump fish out the road in Wrangell," Mitchell said. "It smelled, but years later they were like, 'Whoa, look at these raspberries.' "

A salmon processor in Alaska is allowed to dump fish waste, ground into pieces smaller than half an inch, into up to one acre of the ocean. The federal Environmental Protection Agency set that limit because an overabundance of nutrients in the ocean can deplete oxygen as they decompose and create "dead zones," where no life can grow.

Salmon processors often exceed the limits, and are subject to fines from the EPA.

Trident Seafoods, a Seattle-based processor, was ordered to pay a $96,000 fine in November 2002 for illegal fish dumping near Ketchikan. The Ward Cove cannery and the E.C. Phillips and Son plant, both owned by Wards Cove Packing Co., and Norquest Seafoods in Ketchikan, along with North Pacific Processor in Cordova, were fined a total of $148,000 in the summer of 2001 for similar violations.

The fines and a recognition that seafood waste could be a source of protein for a growing world population have led some processors to explore creative and profitable uses for the waste.

"This is one (situation) where ideally the application of good science and technology will address issues of, one, making the industry more profitable and, two, lowering environmental impacts," said Lance Miller, director of the Juneau Economic Development Council.

The JEDC is working with the state Department of Environmental Conservation, members of the fishing industry, and the Southeast Conference - an organization that advocates economic development - on a scoping project to determine ways to fully use salmon carcasses.

"Basically it's a partnership ... to come up with an objective review of the costs for different ways to utilize salmon byproducts," Miller said.

"There's going to be an increasing need for animal protein in the world in the future," he said. "If you look at a fish, fillets account for 45 percent of the fish, and byproducts are the rest of it. That's good protein - it's something that has a use."

The project will look at uses such as the production of fish meal and other animal meal, salmon oil, a high-protein liquid product, and organic fertilizer.

"There are creative ways, but they have to be economic," Miller said. "These things have to pay for themselves."

At a time when fishermen and processors are walking a thin line between making a profit and going broke, few companies can risk losing money on innovative processing techniques.

"There just isn't the fat in this industry," said Earl Hubbard, vice president for regulatory affairs for Trident Seafoods.

Trident operated a floating fish-meal plant near Ketchikan in the summer of 2000, but has not produced fish meal in the area since.

"It wasn't economical," Hubbard said. "We couldn't afford that sort of operation."

Building a permanent fish-meal plant in the region also is unfeasible, said Hubbard. Though such a plant could handle larger amounts of waste, it couldn't make a profit operating fewer than three months out of the year, during Alaska's wild-salmon runs.

Round Gold, a newly formed company based in Seattle, bought a hydrolysate barge from the processing company Cossack Caviar in May 2002. The barge is equipped to transform fish carcasses into hydrolysate, a liquid protein that can be used in aquaculture feed, livestock feed, pet food and fertilizer.

The liquid protein is made by grinding the waste, heating it, and adding an enzyme to break it down into water, lipids, protein and ash, said Sandro Lane, CEO of Round Gold. The protein is separated from the mix and put into barrels or tubs to be sold - if buyers can be found.

"There is no existing ongoing full-scale market for fish hydrolysate," said Lane. "It's new ... these are the markets we're investigating, but they're already buying other forms of protein. You need to go there with your product and show them it's better."

Finding a market is only one of Round Gold's many challenges, Lane said. Though the barge can process up to half a million pounds of fish waste daily, it is limited in Alaska because of the short salmon seasons.

"I don't think you could get more, if you're lucky, than 60 to 80 days at any kind of capacity," Lane said. "The thing really needs to run 350 to 365 days a year to make money."

Round Gold invested $10 million to $20 million in the barge, and has spent an additional $500,000 preparing it for the upcoming season, Lane said. The company has not decided if it will process fish waste in Alaska this year.

"We're viewing some cost scenarios and models to see if we can make money offering the barge in Alaska this summer," Lane said. "It's questionable."

Though this year's plans aren't set, Lane sees good potential for a market for the fish protein.

"There's a train wreck coming between consumption of protein and production of protein on this planet," Lane said. "Alaska harvests a billion pounds of fish protein per year, and over half of that is thrown away to the ocean ... The world will be looking for those sources of protein."

Mitchell, at Kake Foods, has learned that fish carcasses mixed with seaweed and wood chips make a good compost, and that garden aficionados would pay more for fish fertilizer.

The company mixed all of the seafood waste from its processing plant - including pink and chum salmon heads, crab shells and guts and fish tails - with wood chips. The compost operation is 7 1/2 miles from Kake, and the odor of decaying fish generally is detectable only up to a mile away.

Now that the first batch of compost has been produced, the company is working to distribute it. Kake Foods recently was awarded a $47,000 grant from the U.S. Department of Agriculture to acquire organic certification and test possible product names on focus groups.

"Alaska Thunder Dirt is a name we're kicking around, but this first year it looks like we'll try to private-label our stuff," he said.

Selling the compost to an established brand that will market and distribute the product under its own name, called private labeling, would mean lower overhead for Kake Foods. Eventually, though, the company would like to compete in the compost market under its own brand.

The plant has the capacity to process all of Southeast processors' fish waste, Mitchell said. Kake is working on agreements with processors to acquire more waste, but has no contracts in place.

"Nobody that has an EPA or DEC problem with dumping waste into water should have a problem, because we'll gladly take their waste," he said.

Kake has produced 170,000 cubic feet of compost this year. If it is sold by the truckload for use in federal projects, the "worst-case scenario" in terms of price, Mitchell said, the company could receive 50 cents a cubic foot. Bagged and sold to individual gardeners, the fertilizer could fetch much more.

"Kake Tribal has a firm belief that we don't do anything if it's not going to make money," Mitchell said.

Meanwhile, other salmon processors in Southeast will continue to grind and dump and avoid the financial risk associated with new methods of carcass disposal.

"The interesting thing is that all of the plants have looked at alternatives themselves," said Craig Wiese, an independent consultant working with the JEDC scoping project.

"Everybody I talk to in the industry has already run the numbers, looked at the profitability and determined that (alternatives to dumping) are unprofitable."

Christine Schmid can be reached at cschmid@juneauempire.com.