The Economic Impact of the Catfish,Ictalurus punctatus,Industry on Chicot County,Arkansas

Abstract

This study analyzed the contribution of the catfish industry to the economy of Chicot County, Arkansas, using an input-output model. The objective was to quantify the economic contribution of the industry in terms of creating new dollars, jobs, and income to the local community. Mail surveys and personal interviews were used to collect data from catfish farmers, processors and other businesses related to the catfish industry. For farmers, the information solicited included production and marketing costs, sales and employment. Out of approximately 85 questionnaires administered to catfish farms, 44 usable questionnaires were obtained for a response rate of 52%. Businesses directly related to the catfish industry provided information on employment and sales and included: processors, seiners and haulers, pond builders, tractor and equipment dealers, and feed bin manufacturers. Other businesses with indirect ties to the catfish industry included: input supply companies, banks, fertilizer and chemical companies, auto shops, electricians, and bookkeeping firms. The survey data were used to modify the IMPLAN database for Chicot County to reflect the 2001 level of catfish production, processing and services available to support the industry. This database was then used to estimate the economic impact of the industry to the county's economy. In 2001, the 85 catfish farmers in the county operated about 7,859 ha (19,500 acres). The farm-gate value of catfish production exceeded $63 million. Employment on catfish farms was approximately 510. In addition, 59 other businesses depended on the catfish industry. Results indicated that total employment created in Chicot County by businesses directly or indirectly involved with the catfish industry was 2,665 jobs. This represented 48% of all employment in Chicot County. Total tax revenue (federal, state, and local taxes) generated from both direct and indirect catfish businesses was $22 million. Combined, the total economic impact of the catfish industry in Chicot County, including direct, indirect and induced effects, was over $384 million. The output multiplier calculated for live catfish production was 6.05. Thus, each $1 of earnings by catfish farms generated $6.05 total economic activity in the Chicot County economy. If current economic difficulties should result in contractions in catfish acreage in Chicot County by 10%, unemployment rates would increase by 2%. This study demonstrates the importance of the catfish industry to the economy of Chicot County.     

Simulation modelling of high‐throughput cryopreservation of aquatic germplasm: a case study of blue catfish sperm processing

Emerging commercial‐level technology for aquatic sperm cryopreservation has not been modelled by computer simulation. Commercially available software (ARENA, Rockwell Automation, Inc. Milwaukee, WI) was applied to simulate high‐throughput sperm cryopreservation of blue catfish (Ictalurus furcatus) based on existing processing capabilities. The goal was to develop a simulation model suitable for production planning and decision making. The objectives were to: (1) predict the maximum output for 8‐h workday; (2) analyse the bottlenecks within the process, and (3) estimate operational costs when run for daily maximum output. High‐throughput cryopreservation was divided into six major steps modelled with time, resources, and logic structures. The modelled production line processed 18 fish and produced 1164 ± 33 (mean ± SD) 0.5‐mL straws containing one billion cryopreserved sperm. Two such production lines could support all hybrid catfish production in the United States and 15 such lines could support the entire channel catfish industry if it were to adopt artificial spawning techniques. Evaluations were made to improve efficiency, such as increasing scale, optimizing resources, and eliminating underutilized equipment. This model can serve as a template for other aquatic species and assist decision making in industrial application of aquatic germplasm in aquaculture, stock enhancement, conservation and biomedical model fish.     

Comparative Economics of US Catfish Production Strategies: Evidence from a Cross‐sectional Survey

Understanding the effects of specific management strategies on yields and economic outcomes on commercial catfish farms could provide useful guidance to catfish farmers on the most profitable sets of production practices. Data from the U.S. Department of Agriculture–National Animal Health Monitoring System (USDA–NAHMS) 2009 survey of production practices on catfish farms in Alabama, Arkansas, Louisiana, and Mississippi were used to identify five clusters of catfish farms that use various stocking densities, channel versus hybrid catfish, different aeration levels, and utilize automated oxygen sensors. The lowest production costs ($1.96/kg) were found in cluster 1 and were followed in order of increasing costs per kilogram of clusters 2 and 4 ($2.16/kg) and cluster 5 ($2.73/kg); the highest cost corresponded to cluster 3 ($2.84/kg). The lowest risk levels corresponded to the clusters with the lowest production costs per kilogram of fish and the highest risk levels to the highest production costs. This analysis demonstrated that different types of management models can achieve similar levels of production costs ($/kg), and it appears that there is not one single economically optimum way to raise catfish. The key to least‐cost production is to balance the use of inputs, their associated costs, and the yield produced to achieve economic efficiency within the farm's overall business and management model.     

The Effect of Hybrid Catfish Fingerling Prices on the Relative Profitability of Hybrid Channel Catfish

Previous studies have indicated that the price premium charged for hybrid catfish fingerlings may be a significant factor in the adoption and profitability of hybrid catfish production. An enterprise budgeting simulation analysis was developed to compare costs, risk, and effect of hybrid fingerling costs. Feed, fingerling, and total costs ($/ha and $/kg) were highest for hybrid catfish production, intermediate for NWAC‐103, and lowest for normal channel catfish production. Net returns were highest for hybrid catfish production, but breakeven prices were also highest. Risk analysis showed that downside risk (risk of losing money) was higher for hybrid production for all farm sizes. Risk‐averse farmers would not select hybrid catfish at the mean fingerling values used in the analysis. However, at hybrid fingerling prices less than $0.0081/cm, hybrid catfish production was superior in profitability and breakeven cost of production. Thus, for hybrid catfish production to be preferred economically to normal channel catfish, the price premium for hybrid catfish fingerlings can be no more than 84% ($0.0037/cm) above that of normal channel catfish fingerlings and 57% ($0.0025/cm) above that of NWAC‐103 fingerling prices.     

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.     

Cost of regulations on US catfish farms

Understanding the economic effects of regulations on US aquaculture farms provides insights into which compliance costs create the greatest compliance burden on farms. This can further guide strategies to improve the efficiency of regulatory frameworks and potentially reduce on-farm compliance costs while maintaining adequate oversight. This study estimated the regulatory compliance burden on US catfish farms as part of a national effort to quantify the cost of regulations on US aquaculture farms. Completed survey interviews of catfish farms in the major catfish-producing states covered 63% of the total US catfish production area. Total regulatory costs of the US catfish industry were estimated at $45 million annually. Lost farm revenues (measured as the value of lost production, the value of markets lost from regulations, and the value of business opportunities lost because of regulations) were estimated to be $35 million per annum. Catfish-producing states outside the Alabama/Arkansas/Mississippi region had the highest ($2856/ha) and Alabama the lowest ($1127/ha) regulatory costs per hectare among the surveyed states. The greatest regulatory cost burden on catfish farms ($18 million) was caused by environmental regulations related mostly to the management of federally protected piscivorous migratory birds, followed by labor regulations ($12 million), and taxes/insurance ($7 million). Regulatory costs ($/kg) were 2.6 times higher on smaller (<80 ha) farms relative to larger (>300 ha) farms. Attention is needed to identify alternative regulatory frameworks that provide the same degree of regulatory oversight but are more cost-efficient.     

ARKANSAS CATFISH FARMERS AND MARKETING CONTRACTS: SOME INSIGHTS INTO MOTIVATIONS

Interest in sales contracts in the catfish industry increased in the late 1990s and early 2000s as a result of increased import pressures and lower product prices. The study uses survey data fitted to a probit model to examine the motivations for contracting sales, and whether farm size is an important determinant of sales contracts usage. The article concludes that Arkansas catfish farmers with large acreages and therefore large volumes of production have a high probability of utilizing contracts to handle their sales but not necessarily with privately-owned independent processors. The farmers are not motivated to engage in sales contracts by reduction in income or price risks. They are motivated by production and management issues, which appear consistent with reductions in transactions costs relating to asset specificity and quality measurement as the reason for contracting.     

Economics of Intensively Aerated Catfish Ponds

The US catfish industry is evolving by adopting production‐intensifying practices that enhance productivity. Catfish producers have increased aeration rates over time, and some now use intensive rates of aeration (>9.33 kW/ha). Costs and production performance were monitored at commercial catfish farms using high levels of aeration (11.2–18.7 kW/ha) in Alabama, Arkansas, and Mississippi. A multivariate‐cluster analysis was used to identify four different management clusters of intensively aerated commercial catfish farms based on stocking density, size of fingerlings at stocking, and feed conversion ratios (FCR). Breakeven prices of hybrid catfish raised in intensively aerated pond systems were estimated to range from $1.86/kg to $2.17/kg, with the lowest costs associated with the second greatest level of production intensity. The two medium‐intensity clusters generated sufficiently high revenues for long‐term profitability. However, the least‐intensive and the most‐intensive clusters were economically feasible only when catfish and feed prices were closer to less probable market prices. Feed price, FCR, and yield contributed the most to downside risk. Intensive aeration in catfish ponds, up to the levels analyzed in this study, appears to be economically feasible under the medium‐intensity management strategies identified in this analysis.     

Economic,Regulatory, and Technological Barriers to Entry into the Florida Aquaculture Industry

A mail survey was conducted in 1991 to identify barriers-to-entry into the Florida aquaculture industry. The survey was administered to all 586 individuals on the Florida Agricultural Statistics Service aquaculture industry participant mailing list. Two hundred twenty of the 227 returned questionnaires were complete. Of these, 175 respondents currently owned an aquaculture business; 141 reported producing only one species (defined in this study to be the general collection of species such as ornamental fish or aquatic plants rather than specific species within these groups), 29 reported producing two different species, and four reported producing three or more species. In order to analyze the data by species; only those aquaculturists producing single species were included in the final analyses. The survey results showed that economic factors (financial and marketing) presented the greatest barriers-to=entry into the Florida aquaculture industry, while regulatory barriers were relatively less problematic. Barriers were found to be highest for catfish culturists, followed by ornamental fish, bivalves, aquatic plants and alligators.     

Principal economic effects of cormorant predation on catfish farms

Substantial economic losses of farmed catfish to fish‐eating birds such as the double‐crested cormorant, Phalacrocorax auritus, continue to be reported on U.S. catfish farms. An economic analysis was conducted of the on‐farm effects of both the increased expenditures to scare fish‐eating birds from catfish farms and of the value of the catfish that were consumed by cormorants. A survey was conducted of U.S. catfish farmers in the Delta region of Mississippi and Arkansas, to obtain farm‐level data on expenditures to scare birds. Estimations of the lost revenue from catfish consumed by cormorants were developed from a concurrent study on cormorant distribution, abundance, and diet in the region. The economic effects of bird predation in terms of both fish consumption and management costs were evaluated across three farm sizes and nine catfish production practices. Catfish farmers spent on average $704/ha ± $394/ha to scare birds, making bird‐scaring costs one of the top five costs of raising catfish. The greatest cost components of scaring birds were manpower (39% of all bird‐scaring costs) and the variable and fixed costs of trucks used to scare birds (34% of all bird‐scaring costs). Losses were greater on hybrid than channel catfish fingerling ponds. Industry‐wide, the value of catfish losses averaged $47.2 million (range of $25.8–$65.4 million). Total direct economic effects (including both the increased costs to scare birds and the revenue lost from fish consumed by cormorants despite bird‐scaring attempts) averaged $64.7 million (ranging from $33.5 to $92.6 million). Profitability improved by 4% to 23% across the farm size/production strategies analyzed upon removal of the economic effects from bird predation, with greater effects occurring on smaller‐scale farms. One‐third of the farm size and production scenarios analyzed changed from being unprofitable to showing a profit in the absence of such negative economic effects associated with bird depredation. Overall, the combined effects of increased farm expenditures to scare birds from farms and the value of the catfish lost to predation by cormorants caused substantial negative economic effects on catfish farms.     

Performance of Alternative Diets Containing Solvent‐Extracted Distillers Dried Grains with Solubles Compared to Traditional Diets for Pond‐Raised Channel Catfish,Ictalurus punctatus,and Hybrid Catfish,Ictalurus punctatus × Ictalurus furcatus

Two concurrent pond studies were initiated in April 2011 to evaluate feeds containing solvent‐extracted distillers dried grains with solubles (SE‐DDGS) in both 28 and 32% protein catfish feeds. Channel catfish, Ictalurus punctatus, were stocked in multiple‐batch production ponds at the University of Arkansas at Pine Bluff (UAPB) and hybrid catfish, ♀ Ictalurus punctatus × ♂ Ictalurus furcatus, in single‐batch production ponds at the National Warmwater Aquaculture Center (NWAC), Mississippi State University, Stoneville, Mississippi, USA. The experimental design was a 2 × 2 factorial with two protein levels (32 and 28% protein), with and without 20% SE‐DDGS. Fish were fed once daily to apparent satiation, and managed similarly to a commercial farm for 186 d at UAPB and 172 d at NWAC. For channel catfish, two‐way ANOVA showed significant effects of both protein level (28% being better than 32%) and protein source (20% SE‐DDGS diets being better than traditional diets) on yield, survival, total diet fed, and feed conversion ratio (FCR), due primarily to effects on the understocked fingerlings. Partial budget analysis suggested that the 28% protein diet with the 20% SE‐DDGS was preferred economically for the prevailing feed costs. For hybrid catfish, two‐way ANOVA did not show significant differences in total diet fed, yield, survival, and processing yields, but use of SE‐DDGS resulted in a lower FCR. Results showed that both channel and hybrid catfish can utilize 20% SE‐DDGS in the diet without adversely affecting production or processing characteristics.     

Reducing Catfish Farm Losses Due to Dockages Assessed by Processing Plants

Dockages can have a significant effect on catfish, Ictalurus punctatus, farm revenues. This study was conducted to quantify common dockages, examine seasonal and yearly variations in dockages assessed, and determine optimal production practices given various dockage scenarios. A convenience survey of invoice records from 30 commercial catfish farms and 10 processing plants provided 3686 daily catfish load records that were used to quantify dockages. A linear programming model was developed to examine optimal production practices given 11 alternative production scenarios with five size‐grading technologies subject to 24 types and levels of dockages. The survey revealed that 95% of catfish loads delivered to processing plants between 1997 and 2002 were assessed dockages that resulted in average losses of 2.45% per load or $0.066/kg of catfish marketed over the study period. Out‐of‐size discounts constituted the greatest losses. Dockage losses can be reduced by shifting either to longer‐term single‐batch production or more intensive grading. Longer‐term production results in fewer smaller fish that would incur dockage losses. However, cash flow constraints require more intensive early‐season grading. The grader choice depended on the dockage tolerance level and rate, the frequency distribution of sizes of catfish in the population, the efficiency of the grading technology, and the cost of the grading method. Larger farms minimize losses with intensive active grading (University of Arkansas at Pine Bluff grader).     

Farm-level costs of settling basins for treatment of effluents from levee-style catfish ponds

Compelled by pending regulatory rule changes, settling basins have been proposed as a treatment alternative for catfish pond effluents, but the associated costs to catfish farmers have not been estimated. Economic engineering techniques were used to design 160 scenarios as a basis for estimating total investment and total annual costs. For static-water, levee-style catfish pond facilities, sizing of settling basins is controlled by factors such as type of effluent to be treated, pond layout, size of the largest foodfish pond, number of drainage directions, scope of regulations governing effluents, and the availability of land. Regulations that require settling basins on catfish farms would increase total investment cost on catfish farms by $126–2990 ha⁻¹ and total annual per-ha costs by $19–367 ha⁻¹. More numerous drainage directions on farms resulted in the greatest increase in costs. While both investment and operating costs increased with larger sizes of foodfish ponds, costs per ha were relatively greater on smaller than on larger farms. For farms on which existing fish ponds would have to be converted to settling basins, over half of the cost was due to the production foregone and annual fixed costs of the pond. Requiring catfish farmers to construct settling basins would impose a disproportionately greater financial burden on smaller farms. The magnitude of the increased costs associated with settling basins was too high relative to market prices of catfish for this technology to be economically feasible.     

Effects of Stocking Sac-Fry and Hatchery-Fed Fry on Production of Fingerling Channel Catfish Ictalurus punctatus

Abstract.— Channel catfish Ictalurus punctatus fry are typically held under hatchery conditions for 7 to 14 d after hatching to allow feeding and growth before they are stocked into nursery ponds to produce fingerling catfish. In an attempt to reduce hatchery operating costs, several catfish fingerling producers in Louisiana presently stock fry within 2 d after hatching before yolk absorption is complete. Fry at this stage of development are commonly referred to as "sac-fry." Although research has shown that fry can be stocked at the onset of yolk absorption with no detrimental effects on subsequent fingerling production, stocking sac-fry has been reported to result in reduced fingerling survival. To further investigate this topic, production trials were conducted in experimental outdoor pools over the course of two growing seasons to evaluate the effect of stocking fry of three different ages (2-, 7-, and 14-d post-hatch, DPH) on survival, growth (weight and length), condition factor (K), yield, feed consumption, and feed conversion ratio (FCR) of fingerling catfish. Results from both trials indicated that the age at which fry were stocked had no effect on production characteristics with the exception of growth. Specifically, fingerlings reared from fry stocked at 2 and 7 DPH were significantly larger than fingerlings reared from fry stocked at an age of 14 DPH. These findings suggest that the practice of stocking sac-fry may be a suitable alternative to the traditional procedure of holding and feeding fry under hatchery conditions prior to stocking. However, in order to fully evaluate the effects of early-age stocking of catfish fry on fingerling production, additional studies must be conducted under pond conditions. Furthermore, these studies must be coupled with a rigorous economic analysis before the practice of stocking sac-fry can be recommended to the catfish industry.     

The economics of sutchi catfish (Pangasianodon hypophthalmus) aquaculture under three different farming systems in rural Bangladesh

This paper examines production costs and returns of sutchi catfish (Pangasianodon hypophthalmus) aquaculture under three different farming systems in Bangladesh. Based on the production technology, sutchi catfish farming is classified as extensive, semi‐intensive and intensive. Results showed that sutchi catfish farming is profitable irrespective of the level of intensification and in all three instances the cost of feed dominated the variable costs of production. The average annual production costs were estimated at US$5217 ha^?1 in intensive farming, while US$2694 ha^?1 in semi‐intensive and US$981 ha^?1 in extensive farming. Despite the higher production costs per hectare, the average annual net return was higher in intensive farming (US$3364), compared with semi‐intensive (US$2048) and extensive (US$1099) farming. The average annual production per hectare under intensive farming conditions (13 945 kg) was higher than semi‐intensive (7705 kg) and extensive (3380 kg) farming mainly due to higher levels of inputs, including seed, feed, fertilizer and labour. However, the Cobb–Douglas production function model suggests that inputs are inefficiently used in the intensive farming system. Conversely, there is enough scope to increase the production and income from the semi‐intensive and extensive farming systems by using more inputs.     

Profitability comparison of the partitioned aquaculture system with traditional catfish farms

Abstract

The Partitioned Aquaculture System (PAS) provides a promising intensive aquaculture technology that is efficient and profitable, while simultaneously solving a variety of culture problems. This creates a sustainable aquaculture technology, which is environmentally safe and economically feasible. The PAS eliminates water discharge and reduces land usage and ground water requirements.

The PAS system production process was modeled for catfish production using a growth model developed from observed data. The results of the PAS economic analysis were compared with two traditional catfish production scenarios. Comparisons were made between estimated investment requirements, operating costs and internal rates of return and breakeven points for alternate production systems and land ownership status. The results look promising, but research is ongoing on how best to manage the filter feeder component of the PAS.     

OPTIMAL SIZE OF FINGERLING TO UNDERSTOCK IN CATFISH GROW-OUT PONDS: AN APPLICATION OF A MULTI-PERIOD INTEGER PROGRAMMING MODEL

This article developed a multi-period linear programming model to identify the optimal size of fingerling to understock to maximize multi-period returns on a catfish grow-out farm. Grow-out production alternatives included understocking three different sizes (7.6 cm, 12.7 cm, and 17.8 cm) of fingerlings in multiple-batch production at 15,000 fingerlings per hectare. Fingerlings were produced either with or without thinning at different stocking densities. Results showed that the optimal size of fingerling to understock was 12.7 cm. On-farm production of fingerlings was optimal across all farm sizes but the fingerling production technique selected varied with farm size. Models of larger farm sizes indicated that it is optimal to thin fingerlings, while for smaller farm sizes, producing fingerlings without thinning was optimal. When farm size was treated as an endogenous variable in the farmer's profit-maximizing decisions, the optimal size of a catfish farm was 404 water-ha. Sensitivity analyses suggested that net returns were sensitive to changes in the key parameters of the model (such as interest rates, feed conversion ratios, survival rates, catfish prices, harvesting costs, and the availability of operating capital), whereas the optimal size of fingerlings to understock was robust to variations in the model's parameters.     

Delayed Feeding of Channel Catfish Fry Stocked in Ponds

We compared production variables between channel catfish, Ictalurus punctatus, nursery ponds fed according to industry standards, that is feeding immediately at stocking, to an alternative practice of delaying feeding for 6 wk after stocking in an effort to utilize natural pond productivity and reduce feed use. Twelve 0.04 ha ponds were fertilized and stocked with swim‐up fry (4–5 d posthatch) at a rate of 10,000/pond (250,000/ha). Ponds were then randomly assigned to either the standard feeding protocol (feeding daily starting immediately at stocking) or an alternative feeding protocol (no feeding until 6 wk post‐stocking). After 18 wk of production, there were no differences in water quality or zooplankton abundance between the two treatments. Fish length was not affected by treatment throughout the study, and survival and total weight harvested were similar. Total kg of feed fed was significantly reduced in the delayed feed treatment, averaging 26 kg/pond less feed fed. If proper fertilization practices are implemented, large numbers of desirable zooplankton for catfish fry culture are attained, and these zooplankton are able to sustain catfish fry stocked up to 250,000/ha. Therefore, no commercial diets are required during the first 6 wk of culture, saving over $95.55/ha in initial feed costs.     

Evaluation of a Confinement System for Growout of Channel Catfish Ictalurus punctatus

Rising costs of inputs have created a need to improve catfish production efficiencies. An inexpensive confinement system was evaluated for channel catfish Ictalurus punctatus foodfish production. Barriers were constructed in five 0.1-ha earthen ponds to partition ponds into 1/3 and 2/3 sections. Large fingerling (136 g) catfish were stocked at 11,115 fish/ha in the smaller 1/3 section (shallow end) of the confinement ponds or in open ponds (control). Seining efficiency was significantly greater for the confinement system. Yield and daily growth of food fish were significantly lower and feed conversion ratio higher in the confinement system compared to open ponds. Partial budget analysis showed a net loss of –$313/ha. Additional work is needed to develop inexpensive production systems to capture efficiencies of confinement without decreasing production.     

Economic assessment of commercial-scale Edwardsiella ictaluri vaccine trials in U.S. catfish industry

Abstract

Enteric Septicemia of Catfish (ESC) is a ruinous bacterial disease affecting the U.S. catfish industry. Previous attempts to develop ESC vaccines have failed to achieve industry acceptance, largely attributed to difficulties in delivering the vaccine to immunocompetent fish. Recently, a live attenuated ESC vaccine has been developed, coupled with a mechanized platform designed to accurately deliver measured doses of vaccine with feed. This delivery scheme for vaccine-feed admixture has shown tremendous promise under controlled research settings. This study evaluated the economic effects of on-going commercial-vaccination trials on catfish fingerling operations in Mississippi. Commercial-vaccination trials for both channel and hybrid catfish demonstrated significant improvement in survival, growth, feed consumption, feed conversion and gross yield. At a realistic vaccination cost of $750/ha, the net economic benefits to channel and hybrid catfish fingerling-production phases were $3199 and $6145/ha, respectively. Whole-farm models showed additional profit ranging from $71,758 to $133,887/400-ha on farms that integrate fingerling production to their production strategies due to appropriation of more of the otherwise incumbent fingerling production acreage into foodfish production. Commercial adoption of the oral-vaccination platform would greatly enhance profitability while laying the foundation for development and delivery of polyvalent vaccines against other catfish diseases.