| Oregon University System Subcommittee |
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| Opportunity area: Agriculture, Forestry, Fisheries, Food and Wine |
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Name
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Title
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Organization
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(Chair) Katy Coba
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Director
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OR Dept. of Agriculture
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Rob Miller
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Owner/Manager
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Mt. Jefferson Farms, Salem
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Marla Rae
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Chair
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Fish and Wildlife Commission
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Fred Vetter
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Owner/Manager
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Oregon Freeze Dry, Albany
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Rich Adams
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Professor
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Agriculture and Resource Economics, OSU
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| Background information about this area |
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Nature of the problem
Natural resource industries have been at the center of Oregon’s economic and social fabric since Statehood and long before. The productive capabilities and the environmental amenities provided by Oregon’s natural resources are indeed one of Oregon’s competitive advantages – they provide both an economic driver and a quality of life that Oregonians highly value.
Integrating the knowledge-based economy with natural resource management and life sciences is among the top opportunities for the next generation of Oregon’s graduates. The need to connect high tech, higher ed, and natural resource industries has never been greater.
Oregon’s economic reliance on natural resource industries remain higher than most other areas of the U.S., indicating that the benefits from enhanced economic performance and sustainable production are significant. Oregon is also more reliant than most states on traded-sector exports –and more than 60% of the volume and 25% of the value of exports through Oregon’s major ports are agriculture and food products, fishery, wine, forestry and wood products.
Oregon’s natural resource industries and their stakeholders face increasing challenges, including changes in world markets and global competition; consolidation of businesses and distribution networks; and stricter regulatory regimes. In addition, changes in public attitudes have affected access to resources, their usage, and cost structures for Oregon producers and processors of food, fiber, fisheries, and timber products. Meeting these challenges requires bold and new approaches to resources production and management.
Natural resource industries are integrated with and closely tied to the economies and social issues throughout Oregon’s communities, whether urban or rural. To thrive economically while sustaining and enhancing the state’s resource base, Higher Education must partner closely with the State’s natural resource industries and stakeholders to find ways that capitalize on Oregon’s land base to:
- develop creative and collaborative solutions to water quality and use, allocation, and conservation efforts that maintain and enhance productive capacity for crops and livestock, forestry and fisheries, as well as environmental, urban, and commercial businesses needs;
- address higher costs of production related to labor and environmental standards by developing new technologies and products that will lower costs and enable sustainable output;
- develop new products (food and fiber) that serve niche markets for which consumers are willing to pay more for quality and specific methods of production;
- tap the potential of natural resources for renewable energy production, bio-fuels, bio-fibers and products that create new revenue opportunities for producers and communities, and that simultaneously address many environmental issues related to air quality, water quality, and sustainability;
- engage Oregonians in re-discovering the quality and value of locally produced products; and,
- create new partnerships and business strategies for today’s global economy.
Improvements in management of natural resources for economic and environmental needs are life science based – the opportunities and need to apply leading-edge technologies and solutions are paramount. Oregon cannot compete broadly or universally in the fields of life sciences, nano-technology and other new arenas with North Carolina, California, New York, New Jersey, Michigan, Texas and other locations that have significantly more public and private resources. For example, business investment in nanotechnology start-ups has increased from $100 million in 1999 to a projected $3 billion in 2004 worldwide. There are about 1,000 nanotech business start-ups operating today, about half of which are located in the U.S., with most in New York, Texas, and other states. However, the opportunity for Oregon lies in applying bio-life sciences and new technologies to the resources and amenities that comprise the unique qualities of Oregon.
Oregon has the opportunity to become recognized as a world-class leader in applying life sciences, nano-technology, and other developments to solving natural resource challenges, developing new products and processes that utilize our natural resources to create wealth and jobs within the state through sustainable practices that maintain the resource base.
Affected areas and industries in Oregon
The natural resource industries, including production, harvesting, warehousing and storage, processing and manufacturing, transportation, and wholesale marketing collectively account for 250,000 jobs in Oregon, roughly 16% of total employment, or one of every six jobs. Natural resource industries are integral components of the economies and ecosystems of every community, from coastal fishing areas to the prime farming areas of the Willamette Valley, to the rangelands, orchards, and wheat fields of Central, Southern, and Eastern Oregon. Rural areas are obviously more reliant on natural resource-based industries and have the greatest opportunities to build on this resource base.
How Oregon compares to other states
Oregon’s natural resources are significantly more diverse than other states. More than 250 agricultural and fishery commodities are produced commercially in Oregon, from apples to nursery products, and alpacas to beef cattle, hazelnuts, caneberries, and wine grapes.
Oregon has many micro-climates and soil topographies that lend themselves to specialty crop and forest production. The western region is unique in the world for its capacity to produce fir trees and other timber products. Oregon has significant amounts of biomass from these resources that could be used for renewable energy generation with more research devoted to cellulosic, gasification, or other forms of conversion to biofuels and energy.
More than half (53%) of Oregon’s land area is federally owned. Of the remaining lands in private ownership, the majority – more than 17 million acres – is managed by Oregon’s farmers and ranchers, 97% of which are family owned and operated. Another 8-10 million acres of forestlands are in private ownership and management. Several million acres are in state forests. All these natural resources lands must be effectively managed.
Oregon has a land zoning system that is designed to maintain Oregon’s unique qualities of open space, agriculture, forest, and rural zoning – but these lands must be economically as well as environmentally sustainable, or they will be converted to other uses.
The commonality in all these instances is LAND. Diverse climates, soils, water, timber and biomass – all comparative advantages tied to the land here in Oregon, these are Oregon’s keys to prosperity, but in different ways than the past. Traditional crops and livestock production will continue, but these must be augmented with new methods, crops, technologies, value-added products made from these crops (e.g., bio-fuels), neutraceuticals and medicinal products, etc.
Barriers to success in this area
The food and natural resource product industries face many challenges in adapting to changing markets and consumer preferences. A vision of Oregon 10, 20, or 100 years in the future points to the critical importance of keeping natural resource industries economically viable and environmentally sustainable. The alternative is an accelerated conversion of natural resource lands to other uses, and the potentially sprawling pattern of developed usage and gridlock in transportation that characterize parts of California and Washington, and the loss of Oregon's unique visual and economically productive landscapes, jobs, and communities.
- One of the most striking evidences of need for Higher Education to focus more efforts on natural resource endeavors is that many Oregon companies are partnering with research institutions outside of Oregon for assistance. For example, Oregon Freeze Dry, a world leader in freeze dry technologies (food, medical, and other applications), has research and development projects on-going with the University of Toronto for wound care; with U.C. Davis on platelets and red blood cells; with North Carolina University-Research Triangle for preserved hemostatic particles for transfusion... and many other universities outside of Oregon related to freeze dried pharmaceutical and biologicals... but no Oregon universities. Here is a world leading company that cannot get the attention of Oregon's institutes of higher learning to partner in cutting-edge research and technology application.
In essence, there has been no strategic analysis of Oregon's natural resource capabilities and life science applications related to current business activities and what could be done. There are many opportunities for Higher Education to collaborate with business and environmental leaders to prioritize research, technological development and application, product design and testing, and other applications of R&D to Oregon's natural resource base.
- In similar fashion, there is a lack of a collaborative effort between agriculture/forestry/fisheries and "high tech" industries to identify mutually beneficial goals and strategic efforts. Much has been made of cluster economics. What we have failed to do in Oregon is bridge the walls between industry clusters to develop cross-cluster collaboration. There is a long list of applications for high technology, nano-technology, instrumentation, machinery, and sensory equipment in the natural resources. Nearly all of the equipment currently being employed in natural resources is imported from out of the state and country -- even though Oregon companies have the expertise and capabilities to design and manufacture it here.
- More research is needed (basic and applied) to determine technologies, processes, and applications that employ the use of natural resources in new ways. For example, renewable energy can be both an economic stimulus and an innovative and environmentally beneficial use of lands and waterways in Oregon. Bio-based fuels from oil-seed crops, bio-based lubricants and other bio-based products, natural fibers, wind energy, digesters that produce methane/natural gas for energy from livestock manure, geothermal heat applications, micro-hydro projects, carbon sequestration -- all ways that natural resources can play a significant role in Oregon's economy and environment have yet to receive much attention from Oregon's university system in specific application to natural resource development.
- New incentives that are mutually beneficial to private business and higher education are needed for the university system to engage in and capitalize on innovation and technologies through patents and other partnerships. If higher educational institutions in Oregon could more effectively license and share in royalties from new applications of processes, products, and instrumentation developed for use in the natural resource, such as currently exists in many other systems of higher education (e.g., the University of California system) there would be more partnerships structured with Oregon businesses to further the needed work in these areas.
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| Current initiatives in Oregon |
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The following are some of the major efforts in Oregon and the region related to research, innovation, and market development for natural resource based products and solutions. There are many others. While the efforts are substantial, they share the limitations of funding/resources, and do not address the broad need for collaboration of public-private partnerships and vision required for building on the natural resource base with high tech and higher ed as full-fledged partners.
- The Oregon Institute for Natural Resources at Oregon State University:
Created by the Oregon Legislature with the Oregon Sustainability Act of 2001, the Institute works to provide Oregon leaders with ready access to current, science-based information and methods for better understanding our resource management challenges and developing solutions.
- Hatchery Research Center (HRC) at the site of Fall Creek Hatchery near the town of Alsea. Research aimed at understanding what creates differences between hatchery and wild fish and how managing hatchery fish can help conserve and protect Oregon´s native fish populations while providing viable fisheries. Research will be conducted in cooperation with ODFW, Oregon State University (OSU) and the Hatfield Marine Science Center.
- OR Council for Knowledge & Economic Development
The Oregon Council for Knowledge and Economic Development is comprised of 15 members appointed by the Governor and confirmed by the Oregon State Senate. Its mission is to promote knowledge-based economic development, foster collaboration among leadership of public and private institutions of higher education, economic development, and the private sector, and to act as an early warning system for the state in the above areas.
- Multiple Engineering Cooperative Program
Conceived in the summer of 1978, MECOP was to be collaboration between OSU and Oregon-based manufacturing companies that hired engineering graduates. Faced with a growing gap between the skills and knowledge needed to succeed in the work place and those being taught in universities, three major Oregon companies entered into an agreement with OSUÕs Department of Industrial Engineering to start the Manufacturing Engineering Cooperative Program. In 1998/99, students from the management information systems program participated. And in 2000, mechanical engineering and computer science students from Portland State University participated in this program. OIT joined MECOP as a university partner in 2002, enhancing the program by adding the Manufacturing Technical and Mechanical Technical disciplines.
- Integrated Pest Management programs, OSU & ODA research
Many years of research have assisted in developing methods of pest scouting, using phernomes and insect lures, targeted applications, bio-controls, and other methods that result in reducing pesticide usage.
- Food Innovation Center, OR Dept. of Agriculture and OSU
The collaborative efforts of ODA and OSU focus on product development, packaging, consumer testing, value-added processing, marketing, and export assistance.
- Good Agriculture Production Practices (GAP) & Good Handling Practices (GHP) Ð voluntary third-party audit, Oregon Department of Agriculture
The Oregon Department of Agriculture has collaborated with the U.S. Department of Agriculture and Oregon producers and fresh pack processors in developing a third-party, voluntary audit program to certify that producers and handlers for meeting specific production and product handling requirements of wholesale and retail buyers. The department is also working with foreign governments (EuropGAP) to certify export to European nations.
- Clackamas Community College has an outstanding agriculture and nursery program.
- Perrydale High, Canby High, and a few other high schools have exceptional bio-science/FFA/nursery and related programs.
- NW Food Processors Cluster Initiative
Clustering the hundreds of small, innovative food processing businesses in the Northwest could create a strong, sustainable economic foundation. Businesses, associations, educational institutions and government all play a vital role in this effort. The NWFP Association has issued a contract for consultant analysis of a Cluster-Based Approach to Promote Innovation, Entrepreneurship and Growth in Food Processing (Vitally Linked to Agriculture and Suppliers) in Idaho, Oregon and Washington.
- Sustainability/Renewable Energy
A group of Oregon wheat growers have formed an LLC company to evaluate the feasibility of owning wind towers. As renewable wind energy has developed, the predominant model in western states has involved large energy companies owning the towers and power generation and paying a rental fee to farmers for locating the towers on their property. Mid-west growers have been successful in forming cooperatives to own the towers and power generation, creating more local wealth and community development. Oregon producers are making efforts to follow this farmer-owned model, which is also very common in Europe. A number of other efforts in renewable energy are in the making, including anaerobic digesters on dairies, bio-fuel production from oil-seed crops, geothermal, solar, and micro-hydro Ð but all these are in their infancy in Oregon.
- USDA Specialty Crop Grants
Allocated by Congress in 2001, these funds were administered by State Departments of Agriculture. Oregon growers submitted a total of 263 grants, requesting $31 million in assistance for $3.2 million Oregon received from USDA. The State Board of Agriculture selected 54 projects to receive funding assistance. Grant projects included applied field research, product development, applied technology, marketing and promotion, and consumer education. One such project is using low-grade wool from Oregon sheep as the primary fabric in storm drain filters that have proved successful in reducing pollutants from entering Oregon´s waterways in urban areas. Another project is evaluating the seed mill from Meadowfoam, a unique Oregon oil-seed crop, as a natural plant pathogen inhibitor to sudden oak death. The initial results are promising, but significantly more resources are needed to conduct full EPA evaluations for commercial production.
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| Successful examples outside of Oregon |
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An excellent (and classic) example of cooperation between the public university system and the private sector is the development of the mechanical tomato harvester. In the mid-1960´s, California faced the loss of its economically important processing tomato industry due to the phase out of an immigration program that allowed labor from Mexico to enter California on a temporary basis to help harvest tomatoes for processing. To address this challenge, the University of California, in cooperation with the private sector, including farm equipment manufacturers and tomato growers, set about to develop a tomato suitable to mechanical harvesting, as well as to build a machine capable of performing such a harvest. By using the University´s expertise in crop breeding and mechanical engineering, coupled with the private sector´s skills at bringing new technologies to market, a new variety of tomato was developed concurrently with the harvester in a relatively short period of time. These were quickly adopted by the tomato growers and helped save the multi-billion dollar tomato processing industry in California.
The collaborative effort was out-come driven, designed to solve a specific problem. It employed the expertise of all the parties and resulted in real benefits.
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| Potential for and nature of Oregon postsecondary contributions |
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Example: Oregon Freeze Dry in Albany stabilizes 90% of the frozen cultures for cheeses and yogurts in the U.S. Ð a little-known, but remarkable resource and opportunity for Oregon in value-added processing. The company has research in-house for microbiology and product research that would greatly benefit from a collaborative effort with OSUÕs microbiology and other programs, along with partnerships from OHSU and other institutions of higher ed in Oregon.
Example: Twenty years ago Bill Lund of Lake Oswego, OR began work on a mechanical harvester for asparagus. The machine uses laser technology to find spears that are the right height for cutting. Cheap imports of asparagus from Peru and other countries, along with the climbing cost of labor – 80% of the cost of asparagus production – have generated increased interest in the mechanical harvester. The Washington Legislature last year (2003) appropriated $3.8 million toward mechanization to assist the asparagus industry in Washington State survive. Washington State University is involved with evaluation, design, and research on the effectiveness of this and other prototype harvesters. This is an ideal opportunity for Oregon institutions of higher education and the State Legislature to partner with WSU to assist in the development of a locally important economic application of a new technology, and help the Northwest asparagus industry remain competitive in a global marketplace. Similar needs exist for caneberries, tree fruits, and other labor-intensive crops. The development and application of lasers and robotics in the nursery industry — Oregon’s leading agriculture sector — would be another strategic opportunity to join forces between high tech, higher education, and agriculture.
Example: Nano-technology can be used in multiple applications in natural resources. Examples include tracing movement of water or ag chemicals through soil structures, research in fish genetics and more precise mapping of fish life cycle and movements through the ecosystem, micro-application of water in urban and production environments, discoveries and applications in natural fiber technology (viscus, flax, and other plant or animal-based fibers).
Example: Development of plant material that can sequester carbon, enabling growers to participate in carbon sequestration market incentive payments. Harvesting of the materials could potentially be a feedstock for biomass energy or bio-fuel generation. The technology, microbiology, plant pathology and other sciences needed for development of specific crops for carbon sequestration and bio-mass conversion are areas where Oregon could build on its existing expertise if applied to specific projects such as this.
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| Job creation potential |
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New technologies and applications in natural resources and life sciences can assist in maintaining the 250,000 jobs in the sector, and create new jobs. Estimates of job generation are from 12,000 to 30,000 for the renewable energy industry alone in the Northwest over the next 20 years based on a renewable energy development model (ÒPoised for Profit,Ó Climate Solutions, 2003). The higher end of the estimate is based on public initiatives and public-private partnerships. New processing and product development, machinery design and application, research and education, and anticipated new business creation can be significant. For example, a bio-based processing facility (bio-diesel, bio-products, ethanol, etc.) will employ about 40 people for an $8-10 million facility investment. Other jobs are created in the construction of the facilities, production of input crops/products/materials/biomass, transportation, and related functions. Broadening the vision of this endeavor across natural resources demonstrates the potential.
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| Potential funding partnerships |
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Potential funding partnerships – would need to be developed for specific projects
- Federal funds: Sun Grant Initiative... 2002 Farm Bill Energy Title... potentially specialty crop grants... S.P.RO.U.T Initiative...
- Public/private partnerships
- Pilot projects
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| Return on investment for Oregon |
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Investment needed to make a difference
Research laboratories are essential for new discoveries and on-going improvements in any sector. The Oregon Experiment Station system and the Oregon Forest Research Lab, along with the Hatfield Marine Science Center and other institutions are the primary research labs for natural resources. These on-going efforts are critical and require sufficient resource commitments. However, in order to accelerate progress in natural resource management, job creation, production capacity enhancement, and strategic leadership, the following five areas are identified as significant opportunities for private-public sector collaboration and investment of funding, research efforts, product development, and field application or commercialization.
- Nano-technology/high-tech applied to water issues/conservation: Development of micro-sensors for tracking water molecules through soil and watershed movement, tracking fish through their life cycle and habitats, developing water conservation and applications that target crop plant rootsÉ these and many more applications could push Oregon into new vistas of water management that benefit agriculture, wildlife, forests, and urban/commercial needs.
- Renewable energy and bio-fuels: Oregon-specific research is imperative for crop development, conversion processes and engineering technologies, and application evaluation and testing of products.
- Mechanization/labor savings applications: Oregon and Washington are losing the ability to compete in traditional labor-intensive crops such as strawberries, caneberries, asparagus, tree fruits, and other crops due to labor costs that are significantly higher than importing countries such as Mexico, Chile, Peru, Chile, and China. GPS, mechanical engineering, laser technology, hydraulics, and other high tech applications in agriculture, nursery, and forest applications are needed to maintain local production of Oregon’s unique crop diversity.
- Bio-based products, including natural fibers, bio-lubricants, and natural fumigants/chemical: Oregon produces a wide variety of bio-based commodities that can be developed into new value-added products that benefit the environment. Meadowfoam and mustard seed mill, for example, are natural plant pathogen inhibitors with specific crop enhance characteristics. Other fibers, like flax, were once grown abundantly in Oregon and could be again with renewed product development and bio-science applications to new uses.
- Value-added food products from Oregon’s unique mix of commodities: Oregon cannot compete in a commodity market; survival and economic enhancement is reliant on developing new uses and products from our raw materials in a way that provides new wealth throughout the production, processing, and market chain. Food science, chemistry, product development, consumer sensory testing, market evaluation and related activities are areas where Oregon’s small and medium-sized producers and food industry needs on-going assistance and renewed focus.
To make significant progress in these areas will require substantial new funding from public-private efforts to move Oregon into an important leading economic engine based on a marriage between the life sciences and natural resources, and high tech and higher education.
Likely measurable return on investment
Improvements in farm equipment, hybrid seeds and new crops, soil management, integrated pest management, variable-rate fertilizer application using GSP coordinates, irrigation efficiencies, and other technologies have enabled marvelous productivity improvements in agriculture. The rise in agricultural productivity (and natural resources generally) is the single most important source of economic growth in the farm sector. Productivity growth from 1947 to 1985 accounted for 82% of the economic growth in agriculture compared with 13% in the private non-farm economy. In fact, the rate of productivity growth in agriculture over this period, at 1.58% per year, was nearly four times greater than the non-farm sector (.44%). According to a USDA report (Agriculture Research and Development/AER-736, USDA/ERS), "Studies have consistently found that the net social returns to public agricultural research in the United States are highƒ estimated to be at least 35 percent annually..."
Equally important is the “amenity value” provided by our natural resource industries/landscape. There is another set of economic and environmental benefits associated with innovative management strategies that help in sustaining our natural resources. These environmental values are likely to become increasingly important regionally and nationally as they become more ‘scarce” elsewhere. Oregon is unique among pacific coast states (CA, OR. and WA) in that we have yet to lose (irreversibly?) some of the environmental assets of the state.
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| Ability to generate excitement |
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Oregon´s comparative advantage has to be tied to the LAND. The opportunities are endless if we can focus the collective and collaborative efforts of higher education, high tech, and the natural resource/bio-life industries. Natural resource lands in agriculture, forest, or other natural use cannot be viewed merely as open space to be converted to urban or commercial build-up. These lands are endlessly renewable in their applications; they are outdoor factories that produce food, fiber, medicines, fuels, beautiful vistas, jobs, and so many other necessities of life.
We cannot compete with the billions of dollars being spent elsewhere on nano-technology and other sciences, but we can thrive and even leap past competitors if we identify ways to work together using this technology in innovative ways. Collaborative proposals to the Legislature would gather significant support if we can combine interests to develop and employ engineering, biochemistry, medical, high tech and nano-technology in strategic new ways that are innovative, captivating in their approach to natural resource management, and create new profitability for farm, forest, and other natural resource lands and Oregon´s communities. The results would reverberate throughout Oregon and trigger worldwide interest and application.
Oregon could be known as the "Natural Resource Innovation State," where natural resource industries throughout the country/world would look for cutting edge, state-of-the-art technologies, applications, processes, product development, research and production.
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