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The Honolulu Advertiser
Posted on: Wednesday, February 15, 2006

Bottled seawater industry exploding

By Sean Hao
Advertiser Staff Writer

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Selling seawater to the Japanese for $6 a bottle has become one of Hawai'i's largest and fastest-growing exports.

Shipments of bottled water pumped from a pipeline that extends as much as 3,000 feet below the surface soared fivefold last year to nearly $17 million. Almost all the desalinated water is sent to Japan, where it is marketed as a pure and nutrient-rich drink.

In less than five years, exports of deep seawater have gone from $365,149 to $16.8 million, according to figures provided by the Foreign Trade Zone Division of the state Department of Business, Economic Development and Tourism.

And this may be just the beginning.

"I really think it's in its infancy," said Ron Baird, chief executive of the Natural Energy Laboratory of Hawaii Authority in Kailua, Kona. "It looks like this could be something that could go on for some time."

The seawater comes from the energy laboratory's deep-sea pipeline. The state agency was established in the 1970s as a research facility for ocean thermal energy conversion.

During the next year or so, there will be $100 million in added capital investments and about 180 new jobs at the laboratory, primarily related to new bottling operations, Baird said.

Driving the boom is a Japanese thirst for desalinated deep seawater that started several years ago.

The water sells for about $6 a 1.5-liter bottle in Japan, and producers can't keep up with demand.

The state's largest bottler of deep seawater, Koyo USA Corp., is building a third plant at the energy laboratory.

The new plant will quadruple production to 1 million bottles a day and bring the company's total Hawai'i investment to $80 million, said Koyo general manager Hiroshi Usami.

Koyo is the only company to bottle water so far, but three more bottling plants being built by other companies are expected to open this year followed by as many as four added plants next year.

Koyo's Usami said his company is adding capacity to support future sales outside Japan, including the U.S. Mainland. Koyo's MaHaLo deep seawater already is available in Waikiki.

At full capacity, Koyo now can export about 250,000 1.5-liter bottles a day to Japan. That equates to about $1.5 million a day in estimated retail sales. However, the value reported to foreign trade zone officials is a wholesale rather than a retail value of the bottled water.

Bottling companies at the energy lab pay the state royalties for the use of a seal that certifies the product's Hawai'i origin. So far, $318,000 in royalties have been paid since June of 2003.

After Koyo, the next companies expected to begin bottling are Enzamin USA Inc., Hawaii Deep Marine Inc. and Deep Sea Water International. Savers Holdings Ltd., Hawaii Deep Ocean Waters and Kama'aina Waters LLC also have plans to eventually begin bottling at the lab.

One company plans to sell deep seawater pulled from the depths of O'ahu. Deep Sea Health LLC plans to pump deep seawater into a boat off O'ahu. The water would then be sold to bottlers in Kapolei. The company hopes to begin operations within a year.

"It's just a big, booming thing, and we're real excited to be a part of it," said Deep Sea spokesman Rich Treadway.

Reach Sean Hao at shao@honoluluadvertiser.com.