HQ SUSTAINABLE MARIT (OTC:HQSM)
Industry: Services

Listed 9 Consecutive Market Days. On List as of 12/15/2006 Through 12/29/2006

HQ Sustainable Maritime Industries, Inc. (HQSM), incorporated on September 21, 1989, is principally engaged in the business of aquaculture through co-operative supply arrangements, ocean product harvesting, and processing and sales of farm-bred and ocean harvested aquatic products, as well as production and sale of marine bio-products and healthcare products. HQSM's products include black or Nile tilapia, red tilapia, fresh water shrimps and white leg shrimps, which are sold in the People's Republic of China market, as well as exported to locations in the United States, Canada, Japan and some European countries. Its subsidiary, Jiahua Marine Bio-Product Company Limited (Jiahua Marine), is engaged in the production and sale of marine bio-products and healthcare products in the People's Republic of China. The principal products of Jiahua Marine are shark cartilage capsule, shark liver oil and shark liver (soft gel). On September 20, 2005, the Company formed HQ Sustainable Maritime Industries (Hong Kong) Limited. Tilapia is native to Africa, but has been introduced in many countries around the world. There are three common species, which are reared commercially in ponds from Japan, the Philippines down to Thailand and Indonesia, such as the black or Nile tilapia (Oreochromis niloticus), the red tilapia (Oreochromis mossambicus) and the blue tilapia (Oreochromis aureus), usually in the form of a hybrid based on the original strains. In case of black or Nile tilapia, the fry eat zooplankton and the adults eat zooplankton, phytoplankton, insects, other bottom organisms and manufactured food. The optimum temperature to culture black tilapia is 25 to 30 degrees centigrade, and black tilapia can tolerate low temperature of 11 degrees centigrade. Black tilapia can grow well in water up to 20 parts per thousand salinity. In case of red tilapia, the fry eat zooplankton and the adults eat zooplankton, phytoplankton and manufactured food. The optimum temperature to culture red tilapia is 25 to 30 degrees centigrade, and red tilapia can tolerate low temperature of 10 to 12 degrees centigrade. Red tilapia can grow well in sea water. The Company offers fresh water shrimp products. Jiahua Marine manufactures nutraceuticals to enrich feed formulations for tilapia and shrimps. Jiahua Marine has two activities, a marine bio-products factory, and research and development activity. The marine bio-products factory is located in Wenchang City of Hainan Province, with a ground floor area of 16,667 square meters. Jiahua Marine sells healthcare products under the brand name Jiahua. Jiahua Marine is also engaged in research and development activities in association with Marine Organism Research Institute. Jiahua Marine's products are naturally derived from ocean-harvested byproducts. Jiahua Marine production lines are suitable for the manufacture of nutraceutical components. The plant is equipped with specific gravity molecular separator and accessory equipment for the manufacture of nutraceutical products that can serve as feed additives in the production of feed, including tilapia and shrimp feed. Two products are produced from refined shark cartilage and two from shark liver (harvested from non-endangered shark species). Shark cartilage is highly alkalescent. Shark cartilage contains chondroitin sulfate and calcium. Shark cartilage also contains glycosaminoglycan, amino acids and collagen proteins that are processed for absorption into the skin. Jiahua Marine offers shark liver oil, which is rich in squalene and other nutrients, to which the Company also adds vitamins D and E.

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