ECONOMICS OF AQUACULTURE

Factors affecting cost of aquaculture production

The cost of an aquaculture production will depend on several issues, which include among others, the:

• Species to be cultured
• Difference in climatic & topographical conditions of the site
• Technology being used
• Distance from farms to where the fingerlings are caught and the market
• Price of inputs & other raw materials

Moreover, the major costs that may influence aquaculture production are the (i) Infrastructure, (ii) Feed/ Fertiliser, (iii) Stocking materials, (iv) Labor, (v) Water and (vi) Marketing costs.

(i) Cost of Infrastructure

One of the many types of an aquaculture pond

Before starting an aquaculture production of any species, the primary factor what must be taken into consideration is the proper selection of site (i.e. the topography of the land, water supply, soil quality, etc.). The ideal location for a fish pond is on a flat land. Lands with slope of greater than 5% is not suitable because of a high construction cost and the erosion problems that may arise in the long term. Furthermore, the size, shape and depth of the pond will also affect the cost of construction prior to the cleaning work behind.

Aquaculture tank construction

(ii) Feed/ Fertiliser

Feed and fertiliser are the most important cost item for intensive aquaculture. In fact, the cost of feed in most aquaculture production, accounts for more than 60% of the total cost of production. The cost of feed per unit of a fish pond will basically depend on 2 factors:

• the conversion ratio of fish to flesh - the amount of feed required to grow a kilogram of fish and
• the unit price of feed 

Type of feed depend on type & size of species cultured

However, the cost of feed can be reduced by improving the conversion ratio or by a decrease in the price of the feed for the species being cultured. Otherwise, locally available materials or by products instead of imported feeds can be used as feed.

(iii) Cost of seed

One of the major requirements of an aquaculture production is the seeds, i.e. the fingerlings. A constant supply of good quality of fish seed obtained at a reasonable price is a determinant factor of a successful launching of an aquaculture production. The cost of seed accounts for a high percentage of operating costs of aquaculture. 

Culture of fingerlings in ponds

However, the issue here is not only about the price of the seeds but also about their availability and their survival rate. One of the most reliable methods of seed production is the breeding of those fingerlings.

(iv) Cost of labour

Labour cost is another major expense in aquaculture production because mechanisation has not yet efficiently replaced intensive use of labour. Some tasks that still need human force include feeding, analysis of water sample, maintenance and harvesting which are all major time consuming tasks. 

(v) Cost of water

Carrying out some basic analysis (temperature, pH)

An adequate supply of good quality water is essential for any type of aquaculture production. Different tests, such as COD, BOD and so on must regularly be carried out to ensure that there are no spread of disease which can ultimately affect the whole pond. Monitoring the good quality of water will ensure a good culture of the species.

Procedures for Water Quality Management

(vi) Marketing costs

Marketing costs will include preservation, processing, storage and transportation of the species that were previously cultured. Since fish and other aquaculture species are highly perishable, preservation from farm to when they will be further processed is primordial. Poor transportation on the other hand can also decrease the price due to poor quality of the products.