The Portland Fish Exchange is launching a new oyster sorting and bagging operation inside its cold, cavernous auction warehouse in hopes of growing the state’s aquaculture economy and diversifying a business plan that’s taken a beating since local ground fish landings collapsed.

On Wednesday, the Exchange received the first of what it hopes will be many oyster deliveries. Two employees measured, sorted, bagged and tagged five 100-count bags of Eastern oysters harvested by Running Tide, a two-year-old aquaculture company that operates a hatchery in Harpswell and grows oysters, clams and scallops at three coastal Maine locations.

“Ground fish landings have been going down, down, down for years,” said Bert Jongerden, the longtime general manager of the exchange. “The numbers told us we had to find something else. So we thought, let’s do for aquaculture what we’ve done for ground fishermen. Give them the shoreside support they need to focus on harvesting instead of chasing down sales.”

The pearly white shelled oysters, which measure from 2 ½ inches to 5 inches from hinge to outer shell fan, have rounded edges created from being tumbled, or stirred, to avoid being chipped when shucked, and deep pockets that hint at the plump meat inside. This first harvest is bound for The Shop, a raw bar on Washington Avenue, to be served up on Friday.

Jongerden partnered with Running Tide’s Marty Odlin, whose father and grandfather were ground fishermen and who practically grew up at the Exchange, to launch a small oyster grading and bagging operation, with an eventual eye toward building up enough volume from Odlin and other farmers to one day auction off oysters like he does hake or monkfish.

The aquaculture industry in Maine is booming, with oysters riding particularly high. In 2019, Maine landed 3.3 million pounds of oysters, the second highest harvest on record, worth an estimated $7.6 million to growers, the highest ever. That’s $2.34 a pound for growers, but restaurants are charging as much as $15 per oyster in Houston.

Though the industry is not without its detractors, including coastal property owners who say the seaside floats used to suspend the oyster baskets in the water are eyesores and lobster fishermen who say they interfere with their ability to set traps, much of the criticism has focused on the state’s system of approving leases for growers to operate on the water.

But the Maine Technology Institute recognized the industry’s potential, and how the arrangement between the Exchange and Running Tide could herald a new path to market for aquaculture in general. In August, the organization awarded them a $50,000 grant to buy equipment for the shoreside grading, sorting and bagging operation.

This partnership allows the Exchange, which makes its money by charging a handling fee, to increase and diversify its revenue stream and one day, if the oyster volume grows as much as Jongerden believes it will, to expand the product line available to auction buyers, and those restaurants and seafood retailers who buy product from them.

In return, Running Tide gets access to a state-of-the-art cold storage facility with staff trained to handle seafood safely, the Exchange’s regional network of high-volume seafood buyers, and the marketing advantage that comes with having a product graded, sorted, counted and bagged by a reputable third-party handler like the Exchange.

If other aquaculture companies join in, leading to the eventual establishment of oyster, scallop, clam, mussel and kelp auctions, even those who don’t use the Exchange would benefit from the establishment of a market price that could be used when selling their shellfish and sea vegetables to wholesalers in almost any market, Odlin said.

But for Odlin, with his family’s long history with the Exchange, it goes even deeper than that. He knows the Exchange needs to diversify and boost its revenue stream if it wants to continue serving Maine’s ground fishing fleet, and he thinks aquaculture can be part of the solution.

“It’s never a good idea to have all your eggs in one basket,” Odlin said. “When you think about the future, with climate change, you need to think about how to leverage Maine’s structural advantages. We have unbelievable tides and a convoluted coastline. Perfect for aquaculture. That’s what makes aquaculture a safe long-term investment for the Exchange, for the whole state.”

Fifteen years ago, the Exchange made 90 percent of its money from grading, sorting and selling ground fish such as cod, pollock and haddock, Jongerden said. But overfishing, reduced quotas and environmental factors have sent landings tumbling, with the latest state data showing cod, pollock and haddock catches down 96 percent, 88 percent and 83 percent, respectively.

That has forced the Exchange, a 30-year-old city-owned institution on Portland’s working waterfront, to make up that revenue in other ways, like providing cold storage services or renting out space at its facility to other businesses, Jongerden said. That non-fish revenue now makes up 40 percent of the Exchange’s business.

This diversification into aquaculture gives Jongerden reason to hope the Exchange will flourish long after he retires in December.

“There are only so many things you can pull out of the ocean,” Jongerden said. “For the past three or four years now, we’ve been running a deficit operation. We can’t have that. So now we’re unloading a little kelp, going to try oysters, see how aquaculture can help us make ends meet and keep serving our longtime customers. It’s change, but that doesn’t have to be bad.”