catfish industry - university of california,...

ANS 18ANS 18 -- CATFISH vs BASACATFISH vs BASA 11

Catfish IndustryCatfish Industry

The Delta


History and infrastructureHistory and infrastructure

••19501950’’s Homers Homer SwingleSwingle and students at Auburn University inand students at Auburn University inAlabama examined the potential of commercial cultureAlabama examined the potential of commercial culture

••Sport fishing hatcheriesSport fishing hatcheries

••19551955 –– 19701970 commercial culture centered in Arkansascommercial culture centered in Arkansas

••> 1970> 1970 MississippiMississippi


The Catfish InstituteThe Catfish Institute --http://http://www.catfishinstitute.comwww.catfishinstitute.com//

The Catfish Institute wasThe Catfish Institute wasfounded in 1986 by a group offounded in 1986 by a group ofcatfish farmers and feedcatfish farmers and feedmanufacturers to improvemanufacturers to improveconsumer acceptance of U.S.consumer acceptance of U.S.FarmFarm--Raised Catfish. Since itsRaised Catfish. Since itsformation, annual catfish salesformation, annual catfish sales(live weight) as well as the(live weight) as well as theindustry have steadily grown.industry have steadily grown.


Off flavorOff flavor ––the double edged swordthe double edged sword

•• Substances produced by pond algae causing offSubstances produced by pond algae causing off--flavors in catfish are not toxic, but make the fishflavors in catfish are not toxic, but make the fishunmarketable. These flavors do go away withunmarketable. These flavors do go away withtime, but increase the cost of production whiletime, but increase the cost of production whilethe fish are being held over while thethe fish are being held over while the compundscompundsclear from the fish flesh.clear from the fish flesh.

•• It has been estimated that the cost of offIt has been estimated that the cost of off--flavorflavorfor Mississippi farmers is estimated to be $16for Mississippi farmers is estimated to be $16million a yearmillion a year


Off flavorOff flavor ––the double edged swordthe double edged sword

However, in cooperation with the CatfishHowever, in cooperation with the CatfishInstitute now all catfish are checked for offInstitute now all catfish are checked for offflavor twice before harvesting. This allowed theflavor twice before harvesting. This allowed theU.S. catfish industry to certify to buyers thatU.S. catfish industry to certify to buyers thattheir would be no problems at the retail endtheir would be no problems at the retail endwith customer satisfaction. This program largelywith customer satisfaction. This program largelyeliminated competition from both wild and pondeliminated competition from both wild and pond--reared catfish grown outside the U.S.reared catfish grown outside the U.S.


Primary product (60%) = filletsPrimary product (60%) = fillets(~ 40% yield from a 1(~ 40% yield from a 1 –– 2 lb fish)2 lb fish)

•• catfish are kept alive up until the minute they'recatfish are kept alive up until the minute they'reprocessed. The entire processing process isprocessed. The entire processing process iscompleted in less than 30 minutes.completed in less than 30 minutes.

•• fish are cleaned, processed and placed on ice orfish are cleaned, processed and placed on ice orfrozen to temperatures offrozen to temperatures of -- 4040ooF below zero.F below zero.Frozen farmFrozen farm--raised catfish are individually quickraised catfish are individually quick--frozen (IQF), a method which preserves thefrozen (IQF), a method which preserves thetaste and quality of the fish.taste and quality of the fish.

•• Plants are inspected and certified by the U.S.Plants are inspected and certified by the U.S.Department of CommerceDepartment of Commerce

•• 20 certified processing plants have a combined20 certified processing plants have a combinedcapacity of more than 10 million pounds ofcapacity of more than 10 million pounds ofcatfish every week.catfish every week.


Catfish production costsCatfish production costs

•• Feed cost has been highly variable but longFeed cost has been highly variable but long--termtermtrend for average feed cost is relatively flattrend for average feed cost is relatively flat

•• Production costsProduction costs -- increase of ~ 1%/yr. whenincrease of ~ 1%/yr. whenfeed prices are held steadyfeed prices are held steady

•• Total annual costs in 1996 estimated to be:Total annual costs in 1996 estimated to be:

–– $ 0.734 for 160 acre farm$ 0.734 for 160 acre farm




Catfish prices (farm gate)Catfish prices (farm gate)

•• SwingleSwingle -- late 1950'slate 1950's $ 0.50/lb$ 0.50/lb(catfish culture profitable)(catfish culture profitable)

•• 1987 (Stickney 1991)1987 (Stickney 1991) $ 0.75/lb$ 0.75/lb


•• 1994 (Aquaculture Outlook, March 15, 1995)1994 (Aquaculture Outlook, March 15, 1995) $ 0.78/lb$ 0.78/lb

•• 1999 (The Catfish Journal, September)1999 (The Catfish Journal, September) $ 0.77/lb$ 0.77/lb



Industry stabilityIndustry stability --

•• Increase in productionIncrease in production

–– 19501950’’s = ~ 1,000 lbs/acres = ~ 1,000 lbs/acre

–– Today some farmers harvest 7,000 lbs/acreToday some farmers harvest 7,000 lbs/acre

•• Increase in farm sizeIncrease in farm size

•• Expansion of markets from regional to nationalExpansion of markets from regional to national ––catfish # 5 most popular seafoodcatfish # 5 most popular seafood

•• C.I.C.I. –– off flavoroff flavor

•• Year round availabilityYear round availability

•• Value added productsValue added products


“David” =Vietnamese cageculture of catfish

“Goliath” =U.S. pondculture of

catfish

Industry survivalIndustry survival threatenedthreatened


Basa (Basa (PangasiusPangasius bocourtibocourti))catfishcatfish –– cage rearingcage rearing

AsAs basabasa is grown inis grown inmoving water theremoving water thereis no off flavoris no off flavorproblemproblem


Basa catfishBasa catfish

•• Asian catfish sold asAsian catfish sold as ““Delta (Mekong)Delta (Mekong)CatfishCatfish””

•• 2002 (USDA) price drops2002 (USDA) price drops $ 0.58/lb$ 0.58/lb

•• U.S. Congress legislates that only catfishU.S. Congress legislates that only catfishgrown in the U.S.A. can be labeled suchgrown in the U.S.A. can be labeled such

•• Basa fillets capture 12% of U.S. $ 590Basa fillets capture 12% of U.S. $ 590million marketmillion market

•• U.S. catfish growers call for antiU.S. catfish growers call for anti--dumpingdumpingdutiesduties


Catfish prices (farm gate)Catfish prices (farm gate)

•• SwingleSwingle -- late 1950'slate 1950's $ 0.50/lb$ 0.50/lb(catfish culture profitable)(catfish culture profitable)



•• 1994 (Aquaculture Outlook, March 15, 1995)1994 (Aquaculture Outlook, March 15, 1995) $ 0.78/lb$ 0.78/lb



•• 2002 (USDA)2002 (USDA) $ 0.58/lb$ 0.58/lb


The Catfish Ad WarsThe Catfish Ad WarsAgifishAgifish –– biggestbiggest

importer ofimporter of basabasa usedusedall the publicity as aall the publicity as abasis for the followingbasis for the followingad:ad:

““What do you knowWhat do you knowabout the tradeabout the tradedispute between thedispute between theAmerican Catfish andAmerican Catfish andthe Vietnamesethe VietnameseBasa?Basa?””

““Just tryJust try AgifishAgifish’’ss BasaBasaproducts, youproducts, you’’ll knowll know””

“U.S. Farm-Raised Catfish …turn your taste buds red,white and blue”

“imported fish … nibbling onwho knows what”


As result of industry efforts pricesAs result of industry efforts prices

stabilized temporarilystabilized temporarily

See Aquaculture Outlook - http://usda.mannlib.cornell.edu/


Impact ofImpact of ““basabasa”” ononU.S. catfish industryU.S. catfish industry

Continued pressure for:Continued pressure for:

•• Further trade conflicts with VietnamFurther trade conflicts with Vietnam

•• Improved efficienciesImproved efficiencies

–– Better and cheaper feedsBetter and cheaper feeds

–– Genetic improvement for faster growthGenetic improvement for faster growth

•• Consolidation of the industryConsolidation of the industry

–– Bigger is better than littleBigger is better than little


Economic analysis of 2 hypotheticalEconomic analysis of 2 hypotheticalfarmsfarms –– ““Why bigger is better!Why bigger is better!””

FarmFarm

II IIII

Land acresLand acres 163163 643643

Water acresWater acres 140140 569569

Acres per pondAcres per pond 17.517.5 17.817.8

Number ofNumber ofpondsponds

88 3232


Capital CostsCapital Costs -- ““Why bigger isWhy bigger isbetter!better!”” (cont.)(cont.)

FarmFarm

II IIII

LandLand $ 130,000$ 130,000 $ 514,000$ 514,000

Pond constructionPond construction $ 118,000$ 118,000 $ 383,000$ 383,000

Wells & EquipmentWells & Equipment $ 188,000$ 188,000 $ 459,000$ 459,000

Total investmentTotal investment $ 436,000$ 436,000 $ 1,354,000$ 1,354,000

Cost/water acreCost/water acre $ 3,100$ 3,100 $ 2,400$ 2,400


Fixed CostsFixed Costs -- ““Why bigger isWhy bigger isbetter!better!”” (cont.)(cont.)

FarmFarm

II IIII

DepreciationDepreciationEquipmentEquipment

$ 12,000$ 12,000 $ 45,000$ 45,000

Interest onInterest onInvestmentInvestment

$ 25,000$ 25,000 $ 100,000$ 100,000

Taxes andTaxes andInsuranceInsurance

$ 3,000$ 3,000 $ 11,000$ 11,000



Variable CostsVariable Costs -- ““Why bigger isWhy bigger isbetter!better!”” (cont.)(cont.)

FarmFarm

II IIII

Feed (32%Feed (32% protprot.).) $ 155,000$ 155,000 $ 627,000$ 627,000

FingerlingsFingerlings $ 41,000$ 41,000 $ 165,000$ 165,000

LaborLabor $ 38,000$ 38,000 $ 142,000$ 142,000

OtherOther $ 122,000$ 122,000 $ 362,000$ 362,000



ProfitsProfits -- ““Why bigger is better!Why bigger is better!””(cont.)(cont.)

FarmFarm

II IIII

Total costsTotal costs $ ~ 0.73/lb$ ~ 0.73/lb $ ~ 0.70/lb$ ~ 0.70/lb

Total productionTotal production(5,000 lbs/acre)(5,000 lbs/acre)

700,000 lbs700,000 lbs 2,850,000 lbs2,850,000 lbs

Profit @ sellingProfit @ sellingprice of 0.75/lbprice of 0.75/lb

$ 14,000$ 14,000 $ 142,500$ 142,500

Profit/water acreProfit/water acre $ 100$ 100 $ 250$ 250

BasaBasa –– PangasiusPangasius bocourtibocourti


Problem for U.S. catfishproducers

2005 taste test studyby Mississippi State

University researchers

Basa preferred 3:1 overchannel catfish

Global ProductionGlobal Production –– Catfish vs. BasaCatfish vs. Basa(1,000(1,000 mtmt))


0

200

400

600

800

1000

1200

1400

1960 70 80 90

2000

2004

2008

Catfish - US

Basa - VietNam

BasaBasa –– PangasiusPangasius bocourtibocourti


U.S. Top Ten 2009

shrimp 4.1 lbs/per

canned tuna 2.5 lbs/per

salmon 2.0 lbs/per

pollock 1.5 lbs/per

tilapia 1.2 lbs/per

catfish (U.S.) 0.8 lbs/per

crabs 0.6 lbs/per

cod 0.4 lbs/per

clams 0.4 lbs/per

Pangasius (basa) 0.4 lbs/per

2008 Global Production

US Catfish = 234,000 mt

Viet Nam Basa = 1,250,000 mt

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