Promising, but let's be honest. Issues still exist. The plan is to make adjustments to the calculations as to how much feed to use and how much stronger to make the filtration system, at least that's what adjustments we know of so far, and instead of doing a 4th large trial, to go ahead and begin the commercial production but to make these adjustments during that period. This effectively makes the first commercial production cycle a fourth trial, at least to some extent. And what unexpected consequences of these changes might occur, or if not fully unexpected, what are we not being told.
Here's the reality, if we are being honest with ourselves. Just as somethings did not turn out as expected in the third trial, and I have asked myself why surprised at the low mortality, did they not see that same low mortality in the first two trials, since they got some good surprises in this larger third trial, like the low mortality, and some bad like the smaller than expected shrimp at 24 weeks, how can we be sure the adjustments will work exactly as hoped, how can we be sure there won't be more surprises, or that they'll even be good ones. If getting all these variables exactly right were that easy, it would long ago have been figured out, but problems plague the shrimp industry on the production side still. This new vibro suppression technology is a great new addition, but the old issues still exist, as we are seeing. And simply automating things doesn't necessarily mean that will make it easier either. It sounds to me like the first commercial run will in effect also be a 4th trial. And for all we know there will then be a fifth and sixth and so on. This is promising yes, but by no means a given that it will be successful or as successful as they hope. We still await completion of this third trial, apparently late January or February, then reporting of final results, and from what I can see, then explanations as to what adjustments will be made going forward and what results they hope to get. Hope to get is the operative phrase. That this is all still going to be developing as they move forward is likely going to be an issue to some degree with any or all potential partners, licensees or buyers.
This could mean that we will see more dilutive financing re-affirmed thru GHS or others until such time as more of these uncertainties are known and figured out, and that SHMP will have to go it alone or more alone than they had hoped as they initiate in TX and expand to the next few cities.
Let's not forget, all these plans will cost a considerable amount of money, plus the new costs of the already announced expansion with F&T into other aquatic species. All that testing and proving will take time just as it has for the shrimp, maybe less time since they can learn from the shrimp experience, but still time, and very possibly years, certainly not just months. This all means we may well have another PR about what some call toxic financing to look forward to. Maybe multiple. Just a dose of reality here. And no one should be surprised that there may well be things we don't know that we don't know either.
And lastly, from a technical perspective, this is very extended now. Good and bad. We can expect a pullback, a consolidation at the very least, worse if some of those apparently still outstanding convertible Notes begin to hit again. Worse even more should we be informed of more less than ideal financing and dilution being needed. The good is that this could pull all the way back to either side of the rising 50dma, currently around $.019/$.02, without threatening the uptrend. The bad is that this could pull back to those levels. And if it does, that would only accomplish eliminating how much this is extended now. I am not predicting such a large pullback will occur, but I am saying it could easily happen here. Yes, a dose of reality. This is still high risk/high reward, and we cannot forget the high risk side, especially shorter term.
