Situation and Outlook of the US Aquaculture Industry 2000 2001

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Situation and Outlook of the US Aquaculture
Industry2000 - 2001

• Dr. Terry Hanson
• Mississippi State University
• Department of Agricultural Economics

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Presentation

• World trends
• National
• consumption
• species facilities
• Highlight on Catfish Industry
• Short- and Long-Term

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Aquaculture is

• - farming of aquatic organisms
• - intervention in the rearing process to
  enhance production
• - ownership of the stock being cultivated

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World AquacultureProduction
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Source USDC/NOAA/NMFS, 2001
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World Aquaculture Production Major Producer
Countries
Source FAO, 2000 note data includes aquatic
plants
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US Consumption of Fish and Shellfish
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US Per Capita ConsumptionFish and Shellfish
Products
2000
15.6 lbs./capita
Source USDC/NOAA/NMFS, 2001
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US Per Capita Consumption of Meat and Fish, 2000
Lb/person/year
66.0
55.7
49.2
15.6
14.3
Boneless weight
Source USDA Agricultural Baseline Projections
to 2010, February 2001
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Top Ten Seafood Species in 2000
Consumption lbs. per person
Species
Source National Fisheries Institute, 2001
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Top Ten Seafood Species in 2000
Consumption lbs. per person
Species
Source USDOC/NOAA/NMFS, 2001
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U.S. Aquaculture Production
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Production States
NORTH CENTRAL
NORTHEASTERN
WESTERN
Perch Striped Bass Tilapia
Trout Salmon Shellfish Striped Bass Tilapia
Salmon Shellfish Striped Bass
Catfish Striped Bass Tilapia Baitfish
SOUTHERN
TROPICAL SUBTROPICAL
Ornamental, Food and Shellfish
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Aquaculture Sales
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Sales by Aquaculture Category

• Food fish - 70
• Mollusks - 9
• Ornamental fish - 7
• Baitfish - 4
• Crustaceans - 4
• Sport/Game - 1
• Other animal aqua. - 5

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Food Fish Species

• Catfish
• Rainbow trout
• Atlantic Salmon
• Striped Bass
• Tilapia
• Others

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Food Crustacean Species

• Shrimp
• Crayfish
• Freshwater prawn
• Softshell crab

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Baitfish Species

• Golden shiner
• Fathead minnow
• Goldfish
• Others
• Bull minnow
• common carp
• tilapia
• sunfish

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Ornamental Species

• Goldfish
• Angelfish
• Guppies
• South American Catfish
• Koi carp
• 100s of others

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Pond Stocking Species

• Channel catfish
• Largemouth bass
• Bluegill
• Redear sunfish
• Yellow perch
• Trout

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Estimated 1999 US Finfish Shellfish
Aquaculture Production Value (1,000,000)
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Estimated 1999 US Finfish Shellfish
Aquaculture Production Value (1,000,000)
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Aquaculture Production Facility Types In Use

• Ponds - 63 -
• Cagesand pens
• Raceways
• Closedre-circulation systems

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Aquaculture Production Facilities

• Ponds
• Cagesand pens - 4 --
• Raceways
• Closedre-circulation systems

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Aquaculture Production Facilities

• Ponds
• Cagesand pens
• Raceways - 14 ---
• Closedre-circulation systems

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Aquaculture Production Facilities

• Ponds
• Cagesand pens
• Raceways
• Closedre-circulation systems - 7 -----

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U.S. Catfish Industry
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Catfish Water Surface Acres
Total Catfish Acreage 185,700
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Catfish Round Weight Processed

through August 2001, 100 of last year at this
time Source USDA Economics and Statistics
System, NASS
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Total U.S. Catfish Sales
?
Source USDA Economics and Statistics System,
NASS
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Fresh and FrozenCatfish Products
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Product Form Sold
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Average Fresh and Frozen Catfish Product
Price Received by Processors, 1999 - July 2001
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Catfish Fillets Processed in U.S.
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Catfish Industry Issues

• Low catfish prices for producers
• Increasing production costs
• EPA effluent discharge regulations
• Other issues affecting production costs

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Low Catfish Prices Received by Producers

• Why?
• Viet Namese frozen fillet imports increasing
• On-farm inventories up
• Full freezers at processing plants
• Economic uncertainty
• Stagnant per capita consumption

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Catfish Price Paid to Farmer, /lb
25-year avg
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Catfish Price Paid to Farmer, /lb
10-year avg
25-year avg
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Catfish Price Paid to Farmer, /lb
5-year avg
10-year avg
25-year avg
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Catfish Price Paid to Farmer, /lb
5-year avg
10-year avg
25-year avg
2001 price
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• Average 2001 prices are
• 0.09/lb less than 5-year average
• 0.06/lb less than 10-year average

through September 2001, not adjusted for
inflation (nominal prices)
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Catfish Price Paid to Farmer, /lb
2000 price
0.12 per lb less in Sept. 2001 than in 2000
-16
2001 price
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Lower Price Received by Farmer Net Returns

• Cost of production
• 0.60 - 0.72 / lb
• Present price of 0.62 / lb
• Loss for less efficient farmers
• Very low profit for efficient farmers

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Imports of Catfish to U.S.
Source USDA/NASS
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Imports of Catfish to U.S.
from rivers
Source USDA/NASS
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Imports of Catfish to U.S.
Viet Namese Frozen Fillets 78 - 97 of all
imports

Source USDA/NASS Through July 2001
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How have imports affected the price of frozen
catfish fillets? Frozen Catfish Fillet Prices
1999 - 2001
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Comparison of Fillet and Pond Bank Prices
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Industry Response to Imports

• Legislation
• Country of Origin labeling
• Removal of Channel Catfish images on import
  packaging
• Seek to have Catfish name removed from
  non-Ictaluridae fish species
• Advertising
• Concentrate on strict US safety and health
  standards
• Legal
• Anti-dumping case?

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Food Fish Inventories UP

• Compared to last year Food Fish Inventories are
  Up
• Large FF 54
• Medium 46
• Small 24

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Food Fish Inventories UPWhy?

• Fish size that processors want has increased
• Early 1990s - 1.00 lb avg
• Mid 1990s - 1.25 lb avg
• Early 2000s - 1.50 lb avg
• Some processors now wanting 2.0 lb avg
• Larger fish require longer production cycle
• 18-24 months

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Food Fish Inventories UP

• Glut of fish ready for harvest
• Expensive and risky for farmers to keep on-farm
• Low prices make selling unattractive
• Some Processors are reducing the number of shifts
  or processing lines

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Increasing Production Costs

• Feed price inching upward
• Increasing bird populations
• Diseases old and new

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Types of Bird Damage

• Feeding on catfish (80)
• Injury of fish (33)
• Disrupting feeding (23)
• Damaging structures (23)
• Transmission of disease
• White Pelican - trematode - Rams horn snail,
  since 1998

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DCCO Wintering Population and Catfish Acreage in
MS Delta
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EPA Effluent Discharge Regulation

• Looking at aquaculture discharge as point source
  of pollution
• Diverse industry
• Screener survey sent out in Aug/Sept 01
• Long form of survey to follow
• Regulations due out in July 2002
• Expected to increase costs of production

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Fish Price
75 cents/lb
70 cents/lb
65 cents/lb
60 cents/lb
55 cents/lb
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Short-Run

• If producers cannot cover variable costs
• Stop producing?
• Difficult to stop multiple-batch production
  systems
• May delay restocking ponds
• Could lead to future shortages 15 - 18 months
  later

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Long-Run

• If producers cannot cover Variable and Fixed
  costs, then what?
• Make Adjustments to production scheme
• modular components specializing in developing
  large stockers
• use of genetically improved or hybrid catfish for
  faster growth
• better management of off-flavor, diseases, and
  birds

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Outlook for 2002

• Expansion on hold
• Less new pond construction
• Efficient farms will break even
• Less efficient farms will lose some equity gained
  in last few years

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Outlook for 2002

• If prices remain low
• some producers will not restock
• could lead to a shortage of fish in 2003
• adapt with new less expensive strategies of
  production

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Outlook for 2002

• Much depends on how successful industry is in
  handling increasing imports

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Outlook for Long-Term

• Food producers will be needed
• Food producers will make a living and make money
• Catfish production will continue to increase
• Fish consumption will continue to go up
• Beef is a substitute
• high beef prices will likely increase fish
  consumption