A survey of aquaculture production economics and management

Abstract

The literature on production economics and management of fish culture has grown as aquaculture has matured as a commercial industry. Salmon, catfish, shrimp and trout are the focus of this literature survey as a reflection of the volume of research that has been completed on these species and their importance in US production and world trade. In addition, a discussion of low resource production systems is included that is dominated by tilapia and carp culture systems. A brief overview of the principles of aquaculture production economics and management is presented followed by a review of economic studies.     

Grow-Out Production of Carps in India

ABSTRACT

Asian aquaculture has been contributing in great measure to the global fish basket. The Indian subcontinent, with a rich biodiversity of fish species, has emerged as an important aquaculture country, particularly in the freshwater environment. Carps form the mainstay of culture practices in the country, supported by a strong traditional knowledge base and scientific input in various aspects of biology, environment, nutrition, and health management. New species and culture systems, integration with other farming systems, use of organic material as nutrient inputs, and depuration measures in waste-fed culture systems are being considered for enhancing aquaculture productivity. This article presents the status of grow-out production of carps in India and traces the growth of the practices over the decades as well as the potential of the sector.     

Effect of information on attitudes towards offshore marine finfish aquaculture development in northern New England

Abstract

Social science can make important contributions to understanding the prospects for offshore marine aquaculture development because many of the potential barriers that may restrict its development are social and institutional rather than biological or technical. This study collects baseline data on attitudes towards offshore marine aquaculture held by a key stakeholder group. It also investigates the influence of information on attitudes towards marine aquaculture. Data reported in this study were collected from visitors to a seafood festival in coastal New Hampshire. The formal objectives of this research were to determine what effect, if any, two‐sided information on the potential advantages and disadvantages of marine aquaculture has on attitudes towards marine aquaculture and how prior familiarity with aquaculture moderates the effect of information. The findings from this study indicate that two‐sided information has a negative effect on attitudes, especially among individuals who are unsure of their level of familiarity with the issue.     

A review of production frontier analysis for aquaculture management

Abstract

This paper examines recent advances in production economics with special reference to efficiency measurement using production frontiers and its implications for aquaculture management. Compared with agriculture and other industries, the use of production frontiers in aquaculture is still very limited. However, in recent years several frontier applications in aquaculture have appeared in the literature, suggesting potential applications of these techniques in aquaculture. A synopsis of stochastic frontier production function model and data envelopment analysis (DEA), the two most popular approaches to efficiency measurement, is presented, followed by a review of recent frontier studies in shrimp, carp and tilapia production. The paper concludes with a brief discussion of future development and prospects of frontier applications for aquaculture management.     

Risk of exceeding bioeconomic limit reference points in shrimp aquaculture systems

Abstract

Designing intelligent management strategies for shrimp aquaculture systems require recognising the uncertainty and risks associated with different processes of aquaculture production. To account for natural variability and other sources of uncertainty, estimates of appropriate aquaculture bio‐economic indicators are needed to re‐evaluate periodically the production system and establish new reference points and corresponding management strategies. This paper concentrates on this aspect of the management process and presents a simple classification of indicators and reference points for aquaculture production systems. The uncertainty causing variability in the estimated values of bio‐economic parameters is incorporated through the use of Monte Carlo analysis to estimate the probability of exceeding limit reference points. To illustrate this process, the risks (i.e. probabilities of exceeding bioeconomic limit reference points) associated to alternative timing of harvesting decisions were estimated by randomly generating uncertain prices and natural mortalities with the appropriate probability density functions and corresponding variance. Alternative approaches to deal with risk and uncertainty in data limited management contexts are discussed.     

Aquaculture in Egypt and issues for sustainable development

Abstract

Although aquaculture in Egypt has the potential for satisfying the increased demand for protein and has been experiencing unprecedented growth during the last decade, questions remain regarding the sustainable development of the industry. It is thus the objective of this article to review the current status and practices of the aquaculture industry in Egypt, highlighting the major issues confronting the sustainable development of the aquaculture industry.

Several issues are identified as limitations to future sustainable development, namely, production technology, fry supply, a feed industry sufficient to meet the demands of a growing aquaculture industry, and marketing and distribution systems necessary to accommodate the strong seasonal supply pattern. The article then concludes with a discussion of recommendations for alleviating these limitations.     

Systems modelling and bioeconomic modelling in aquaculture

Abstract

This paper reviews current and potential applications of systems models and bioeconomic models in aquaculture. Basic information on alternative types of models and the process of model design and implementation is presented. A simple optimal control model, applied to harvesting and feeding decisions, is used to illustrate the numerical solution of dynamic optimization problems. The dynamic programming version of the problem is also presented and the advantages of each approach are discussed. The paper concludes with a discussion of future prospects. An overly mathematical language is avoided and emphasis is placed on practical solution techniques.     

The solution to pollution? The value and limitations of environmental economics in guiding aquaculture development

Abstract

The notable increase of aquaculture production in recent decades has in many instances been matched by growing concern for its impacts. Environmentalists, consumers and members of the general public are increasingly demanding to account for its resource use and to balance its proposed benefits with its environmental sustainability. Although conventional financial and economic analyses have demonstrated a broadly positive impact for many forms of aquaculture, including the more intensive resource‐demanding systems, the use of economic tools embracing wider measurements of social and environmental costs and benefits might provide different and possibly more critical perspectives. However, although these techniques hold promise for such analyses, their development and application in sectors such as aquaculture are as yet limited. This paper reviews the relevant issues, considers the tools and applications of environmental economics and proposes ways in which these may be more effectively be applied in strategic and local decision‐making for aquaculture development.     

The evolution of farm management,production efficiencies,and current challenges to catfish production in the United States

Abstract

The catfish industry is the most successful aquaculture business in the US. The development and growth of the catfish industry has resulted in complex fish farm businesses that require intensive management. Technological innovations have resulted in increased yields (land use efficiency). However, in more recent years, productivity gains have not kept pace with the rate of increase in input costs. Increasing intensification of catfish production over time has been accompanied by increased use of debt capital that results in higher levels of financial risk. While still a profitable activity, real profit margins have declined as financial risk has increased. New technologies will likely continue to increase productivity over time. Market‐oriented agribusiness approaches to catfish marketing are likely to become the norm. The challenge for the catfish industry is to coordinate adoption of new higher‐cost technologies with demand increasing market development to sustain farm price levels.     

Profitability and technical efficiency of aquaculture systems in pampaanga,philippines

Abstract

We evaluate the profitability and technical efficiency of aquaculture in the Philippines. Farm‐level data are used to compare two production systems corresponding to the intensive monoculture of tilapia in freshwater ponds and the extensive polyculture of shrimps and fish in brackish water ponds. Both activities are very lucrative, with brackish water aquaculture achieving the higher level of profit per farm. Stochastic frontier production functions reveal that technical efficiency is low in brackish water aquaculture, with a mean of 53%, explained primarily by the operator's experience and by the frequency of his visits to the farm. In freshwater aquaculture, the farms achieve a mean efficiency level of 83%. The results suggest that the provision of extension services to brackish water fish farms might be a cost‐effective way of increasing production and productivity in that sector. By contrast, technological change will have to be the driving force of future productivity growth in freshwater aquaculture.     

DEMAND FOR AQUACULTURE PRODUCTS IN TAIWAN: AN APPLICATION OF THE GENERALIZED MODEL

ABSTRACT

Policy decisions on what aquaculture products to develop require information on consumer demand for cultured species. However, information on the structure of demand for aquaculture products is limited and what few studies there are in Taiwan, where aquaculture is a major industry, suffer from methodological problems. To clear up some of these problems, we used modified nonnested testing techniques and performance forecasting to determine which generalized models could best estimate the demand for Taiwanese aquaculture products. The results of modified nonnested testing of the aquaculture demand system showed that prices predetermined and quantities predetermined could be used to estimate demand. The generalized ordinary demand model was able to better forecast performance than the generalized inverse demand model. We used the likelihood ratio test to discriminate among the four competing models for the generalized ordinary model; the AIDS model could be more suitably applied to the data. A more general model that is able to incorporate different dynamic structures (partial adjustment, first autoregressive, and static). This general framework is applied to the AIDS model. The first autoregressive AIDS model we used to calculate the own and cross-price elasticities for milkfish, tilapia, shrimp, shellfish, and carps found that price elasticities varied across fish type, that some products had high long-run own price elasticities, and that the demand for aquaculture products was largely determined by inertia.     

Comanagement for aquaculture: Suggestions from a comparative study between two major production areas of milkfish in the Philippines

ABSTRACT

This study examined if, and how, comanagement is effective in controlling aquaculture industry in the municipalities of Anda and Bolinao in the province of Pangasinan, in the Philippines, the locations of two major production areas of milkfish (Chanos chanos) in the country. Institutional and community analyses conducted in these study sites revealed a unique hierarchy of resource users, as well as unique social and economic problems in aquaculture, distinct from those of capture fishery. It was also indicated that comanagement is seen as a solution for essential practices to be enforced practically and sustainably for the management of this industry. To improve aquaculture governance, it is desired that the comanagement scheme shall include not only the governments and fishers but also business operators who often have large capital and a high degree of power.     

Managing the commons: An economic approach to pearl industry regulation

Abstract

In order to assess whether gender differences affect uptake and participation in aquacultural activities, a study of a cage aquaculture development project managed by a non‐governmental organization (NGO) in Bangladesh was undertaken. CAGES project (Cage Aquaculture for Greater Economic Security) aims to promote the use of low input cage systems for the benefit of the rural resource poor, including women. Using a participatory approach involving semi‐structured questionnaires complemented by group discussions with mapping exercises to cross‐check information, the role of women was investigated. Distance of the household from the water body was revealed as a major constraint to the full participation of women, especially in the more conservative areas of the country. Time‐consuming activities such as the collection and preparation of feed were generally the responsibility of women as part of their ‘household’ tasks. The influence women held over post‐harvest decisions varied between region, villages and households, with women in the Jessore area appearing to become more empowered from cage aquaculture activities. The implications of these findings are discussed with reference to the CAGES project and gender goals in development.     

Level up or game over: the implications of levels of impact in certification schemes for salmon aquaculture

Abstract

Certification schemes are becoming increasingly important within aquaculture management, but the indicators that are used by these schemes are subject to considerable debate. Many have questioned their actual impact on improving the industry, and whether they effectively address the many externalities of aquaculture production. In this paper, we study the choice of indicators in eight major certification scheme standards for salmon aquaculture and examine to what degree they manage to address impacts beyond individual production sites. We find that, in accordance with the criticism, the majority of indicators pertain only to the site-level. However, indicators related to traceability, and to coordination and sharing of information among producers can elevate local concerns to a higher level of impact. We, therefore, argue that among all the certification scheme standards considered here, these types of indicators should be emphasized to a larger extent.     

Impact of ozonation on water quality in marine recirculation systems

Ozone (O₃) is a powerful oxidant and is becoming popular in various aquaculture systems for disinfection and improving water quality by oxidation of inorganic and/or organic compounds. However, the use of ozone in marine-based aquaculture systems has been limited because of the potential to form bromate, which is formed during the oxidation of naturally occurring bromide by ozone. Because bromate is a human carcinogen, there are concerns with its chronic impact on fish health. In addition, the use of O₃ is hindered by lack of quantitative as well as qualitative design and performance information on O₃ for recirculating systems. This study investigated the application of ozonation to control pathogens and enhance the process water quality in a recirculating aquaculture system while minimizing bromate formation. A field scale monitoring program was conducted on process water quality from Atlantic halibut (Hippoglossus hippoglossus) recirculating systems. Ozonated modules showed reduction of 15% total organic carbon (TOC) and less than 25 μg/l bromate concentration was formed. In addition, ozonated modules showed reduction in nitrate, color and suspended solids, as compared to those that did not use ozone. The results of this study elucidates the formation of bromate in marine water recirculation systems.     

Design criteria for recirculating, marine ornamental production systems

While recirculating aquaculture systems for food animals are well defined in the literature, little information is available for the emerging production of high value marine ornamental species. These organisms typically require systems which operate within a narrow range of parameters compared to most food animals, and in addition to growth and survival issues, individual appearance of animals is critical to success. This paper is a general review of the primary design criteria parameters for the production of marine ornamental species in stable, oligotrophic, recirculating aquaculture systems.     

Impact of aquaculture feed technology on fish income and poverty in Kenya

ABSTRACT

The impacts of improved agricultural technologies on smallholder households in Africa are well documented in the literature. However, the literature on the welfare impacts of aquaculture technologies, especially in the context of smallholder households, is very scanty. This paper applies the propensity score matching technique to household survey data to examine the impact of improved feed technology on fish income and poverty in Kenya. After controlling for observable household characteristics, the results indicate that improved feed technology increases aquaculture income and reduces poverty among fish farming households. Specifically, the income effect of the technology is 23–37%, with resultant poverty reduction effect of 19–23% points. Evidence from the study indicates that the likelihood of adopting improved feed in Kenya will surge with improved extension service delivery, access to government subsidized feed, and easy market access for purchasing improved feed and sale of mature fish.     

Effects of inter‐country aquaculture technology diffusion rates on international shrimp market shares

Abstract

Technology innovation and diffusion in shrimp aquaculture has resulted in increased quantity and supply of shrimp to satisfy expanding consumer demand. Logistic growth curves are estimated to depict the rate of diffusion of shrimp aquaculture technology throughout the major shrimp producing countries. A time series/cross sectional model is applied to 1985–1991 and 1995–1999 production data to evaluate factors influencing shrimp production growth rates. Calculated market shares for each country indicate that operating costs, lagged shrimp price, number of hectares in production, lagged export quantity of shrimp, and market structure influence the aquaculture technological diffusion rates and shrimp produced, and suggest that countries that incorporate technologies into their production system benefit the most from increased market share.     

Technical efficiency of carp production in Nepal: An application of stochastic frontier production function approach*

Abstract

Modern aquaculture is a relatively new activity among Nepalese farmers and a small contributor to the economy. Given the abundance of water resources and fish species, rising demand for fish, and its high profitability, aquaculture has potential for future expansion if it is given appropriate attention from the government. In Nepal, productivity in aquaculture is much lower compared to other countries in the region, which suggests that there is potential for increased fish production through technological progress and improvement in farm‐level technical efficiency. However, no formal analysis has yet been conducted to assess the productive performance of Nepalese aquaculture and its potential for future improvement. Against this background, this paper examines the technical efficiency and its determinants for a sample of fish pond farms from the Tarai region of the country using a stochastic production frontier involving a model for technical inefficiency effects. The estimated mean technical efficiency is 77%, with intensive farms being more efficient than extensive farms. The adoption of regular fish, water, and feed management activities has a strong positive effect on technical efficiency.