Blue Star Foods Corp., (“Blue Star,” the “Company,” “we,” “our” or
“us”) (NASDAQ:
BSFC), an
integrated Environmental, Social, and Governance (ESG) sustainable
seafood company with a focus on Recirculatory Aquaculture Systems
(RAS), that its looking to improve its soft-shell crab operations
by introducing cutting-edge technology that combines Artificial
Intelligence (AI) with Ultraviolet (UV) light technology to
revolutionize the industry’s standard molting crab identification
process.
The Atlantic blue crab, scientifically known as
Callinectes sapidus, goes through a molting process where it sheds
its old shell to form a new one. Identifying the precise moment
when crabs are in the molting stage (busters) and harvesting them
before they grow a new shell (soft crabs) is crucial for the
soft-shell crab industry, as soft-shell crabs are high value
seafood staple. The current traditional method of manual inspection
for identifying molting crabs is not only time-consuming but also
prone to errors, resulting in our view in high mortality rates and
operational inefficiencies.
Challenges & SolutionThe
high labor costs in the soft-shell crab shedding industry are
primarily attributed to visually & manually identifying molting
crabs (busters) from non-molting ones (peelers). By implementing an
AI system combined with UV light technology, the identification
process can be automated, significantly reducing labor hours and
costs, enhancing operational efficiency, and decreasing mortality
rates.
Our pilot facility operates 24/7 with three
shifts. First shift from 6 am to 2 pm, Second shift from 2 pm to 10
pm, Third shift (night shift) from 10 pm to 6 am. Observations
indicate that during the night shift, crabs molt at a higher rate.
Production peaks during this time, with a 30% increase in molting
crabs compared to the first and second shifts. Workers during the
night shift are more likely to be tired or distracted, making it
more difficult for them to accurately identify busters. This
increases the likelihood of errors and missed busters, which
negatively impact the yield and overall efficiency, resulting in
lower survival rate when comparing with the other 2 shifts. In this
traditional industry method, the correlation between increase
molting and mortality rate, shown an exponential growth curve.
However; in AI-UV light, we predict the correlation to be a
logistical growth curve. As molting rate increases, a mortality
rate stabilized over time as the AI system maps its processes.
The integration of AI with UV light technology
is expected to accurately and efficiently identify molting crabs,
leading to reduced labor hours, operational costs, and mortality
rates.
By harnessing the power of AI and UV light
technology, this innovative approach aims to automate the
identification process by training the system to recognize the
specific physiological changes in crabs during molting. UV light
will enhance the identification process by highlighting these
changes, enabling AI algorithms to differentiate between busters
and peelers accurately.
Operational Analysis and Expected
BenefitsThe implementation of AI and UV light technology
is forecasted to result in a reduction in labor costs (currently
15% of Blue Star Food’s soft-shell crab revenues), increased
operational efficiency, and improve the current yield rates by 50%,
resulting in potential increase profits of approximately 12.5% or
$9 per dozen [(*) based on our 2024 season average selling prices]
of live soft-shell crabs. The AI system can operate continuously
without fatigue, ensuring prompt and accurate identification of
molting crabs, thereby enhancing overall operational
efficiency.
Furthermore, the technology will aid in
identifying the optimal removal time for soft-shell crabs
post-molting, maximizing their quality and market value while
increasing our average biennial 75% survival rates and operational
profitability.
Pilot StudyAn ongoing pilot
study is conducted to gather and analyze key performance indicators
in the traditional manual method versus the AI-UV system across all
shifts, focusing on those KPI’s such as accuracy, labor hours,
mortality rates, and its costs.
Using AI Software to create a vision system that
monitors crab tanks under UV light, identifying molting crabs based
on fluorescence changes. Its graphical interface simplifies the
process of setting up and adjusting the vision system as needed,
crucial for accurately monitoring crab molting processes.
This groundbreaking initiative represents a
significant step forward in transforming the soft-shell crab
shedding process, paving the way for increased operational survival
rate efficiently, reduced labor costs, hence improved
profitability.
About Blue Star Foods Corp.
(NASDAQ: BSFC)Blue Star
Foods Corp. an integrated Environmental, Social, and Governance
(ESG) sustainable seafood company with a focus on Recirculatory
Aquaculture Systems (RAS) that processes, packages and sells
high-value seafood products. The Company believes it utilizes
best-in-class technology, in both resource sustainability
management and traceability, and ecological packaging. The Company
also owns and operates the oldest continuously operating
Recirculating Aquaculture System (RAS) full grow-out salmon farm in
North America. The company is based in Miami, Florida, and its
corporate website is: https://bluestarfoods.com
Forward-Looking Statements:The
foregoing material may contain “forward-looking statements” within
the meaning of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934, each as
amended. Forward-looking statements include all statements that do
not relate solely to historical or current facts, including without
limitation statements regarding the Company’s product development
and business prospects, and can be identified by the use of words
such as “may,” “will,” “expect,” “project,” “estimate,”
“anticipate,” “plan,” “believe,” “potential,” “should,” “continue”
or the negative versions of those words or other comparable words.
Forward-looking statements are not guarantees of future actions or
performance. These forward-looking statements are based on
information currently available to the Company and its current
plans or expectations and are subject to a number of risks and
uncertainties that could significantly affect current plans. Risks
concerning the Company’s business are described in detail in the
Company’s Annual Report on Form 10-K for the year ended December
31, 2023, and other periodic and current reports filed with the
Securities and Exchange Commission. The Company is under no
obligation to, and expressly disclaims any such obligation to,
update or alter its forward-looking statements, whether as a result
of new information, future events or otherwise.
Investor Contacts:
investors@bluestarfoods.com
Blue Star Foods (NASDAQ:BSFC)
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