Ahamsul ALAM:Professor and Agricultural Development/Marketing Consultant
Department of Cooperation and Marketing
Bangladesh Agricultural University.
1. INTRODUCTION
2. SECTOR OVERVIEW
3. POLICIES TO DEVELOP THE FISHERIES SUB-SECTOR - GOVERNMENT VISION
4. DEMAND CHARACTERISTICS AND DIETARY PATTERNS
5. MARKETING OF FISH
6. SOCIO-ECONOMIC CONDITIONS OF FISH FARMERS
7. CONCLUSIONS AND RECOMMENDATIONS
8. SOURCES USED
9. APPENDIXES
EXECUTIVE SUMMARY
Sector overview
Fishery is an important sub-sector of agriculture in Bangladesh and plays a very significant role in nutrition, employment, foreign exchange earnings and food supply. Agriculture contributed 32% to the Gross Domestic Product (GDP) and the fishery sub-sector contributed 3.10% to GDP in 1995-96. The fishery sub-sector provides full-time employment to over 1.2 million people, about 3% of the active population. Another 11 million people earn their livelihoods indirectly from activities related to fisheries.
Inland capture fisheries consist of 4 047 316 ha of water area, and inland culture fisheries cover 290 374 ha of water area. In 1995-96, catches from capture fisheries contributed 48.42% and culture fisheries 30.14% to the country's total inland production of 78.56%; marine fishes contributed 21.44%.
The inland waters of Bangladesh are inhabited by 260 indigenous species of fish, 11 exotic species of fish and 24 species of prawns. The marine waters of the Bay of Bengal are blessed with about 475 species of finfish and 38 species of shrimp.
Over the last decade, overall fish production in inland waters has increased at a rate of 5.67% per annum, fish production in open waters rose by 4.68% per annum, closed-water catches grew annually by 8.53% and fish-pond production gained 8.18% per annum (estimated through fitting a semi-logarithmic equation). All increases have been statistically highly significant. Total fish production in 1996-97 was 13.70 lac tons (1.37 million t), of which 10.79 lac tons came from inland water bodies and 2.94 lac tons from marine fisheries.
Average pond size in rural areas was 71 decimal (0.29 ha). Of the total number of ponds (average 36 ponds in each village), 53% were under fish cultivation. Of all ponds, 26% were re-excavated during the last ten years.
Income from the sale of fish has a large share in total income of fish farmers. Of total family income, fish sales contributed 42%, followed by income from marketed surplus of crops. Fifty-seven percent of income of medium farms was derived from fish sales, which amounted to 45% for small-scale farmers and 36% for farmers of larger farms.
Fish farmers usually practice polyculture. Major species stocked are rohu, catla, mrigal, kalbaos, silver carp, grass carp, carpu, mirror carp, tilapia, nilotica, Thai shorpunti and African magur.
Medium-sized farm households produce the most fish, amounting to 2.13 t/ha, large farms produce 2.10 t/ha, and 1.73 t/ha are generated on small farms. Average production is 1.96 t/ha. Polyculture is widely practised on small-scale, private fish farms. Monoculture is used for shrimp cultivation in brackish water and in large-scale industrial production in the private sector.
Share of the cost of fingerlings is the highest (35%) in total costs incurred per hectare, followed by feed cost (34.56%) and the cost of labour, which constitutes 13% of total cost. Total cost of fish-culture in ponds stands at Tk 51 118/ha at current prices, and total revenue earned from sales is Tk 91 177 yielding a net return of Tk 40 059/ha under low intensity production (US$ 1 = Tk 49.50).
Fisheries development policies
The fisheries sector is considered to be the vehicle for achieving sustainable development and socio-economic advancement of rural fishermen and fish farmers. Almost all activities associated with culturing fish, such as breeding, nursing, feeding, harvesting, transportation, marketing, drying and exporting, are done by the private sector. Research, development of water areas, extension and regulatory activities are performed by the public sector. Twenty-two technology packages (all exotic species) have already been developed and are being implemented on an experimental basis. Some NGOs and private development organizations are involved in organizing groups, training sessions and activities for generating income for the fishing community and for farmers with marginal incomes. Public authorities plan to develop 10 000 new businesses in different fields of fisheries during the next five years.
Bangladesh earns a considerable amount of foreign exchange by exporting fish and fish products, amounting to about 8.44% of total foreign exchange earnings. Fish and fish products are third on the list of exported products from Bangladesh. Total quantity of aquatic products exported has almost doubled since 1988/89. Nearly 97% of total fish produced in the country are consumed domestically. In 1995/96, total quantity of fish exported increased 147% over the amount of 1989-90, which reflects an increased availability of fish for export in the country.
The government's broad-based policies for developing the fishery sub-sector were unsuccessful due to several constraints, such as inadequate credit facilities, scarcity of fish fry and absence of adequate regulations to manage common-property water bodies. Other major factors affecting the desired rate of development and limiting access to fish and fish products are:
Demand characteristics and the dietary pattern
In Bangladesh, the share of cereal intake is much higher than the desirable level (465 g versus 372 g). Desirable food intake from animal sources is 126 g (it should cover 5% of total energy requirement), while the actual intake is 60 g (less than half of the required quantity). Fish consumption needs to more than double and reach 50 g daily, up from the current level of 24 g. Of total energy required (2 310 kcal), the desirable share from fish is 50 kcal (2.2%). Current consumption of fish provides only 24 kcal of energy (meeting only 1.2% of required energy). Thus, fish consumption needs to increase. Fish consumption rose from 35 g daily in 1991/92 to 44 g daily in 1995/96, indicating a significant increase in the availability of fish (27% increase in per caput consumption) within a period of five years. However, consumption still needs to be raised. Of daily protein intake after cereals (59%), fish provided 14%, which made fish the second highest provider of protein in the country in 1995/96. The share of protein from fish has been higher than protein supplied by livestock and poultry products together, both in urban and rural areas. Rohu is the most preferred among the carps for higher-income consumers. Of the major carps, rohu, catla and mrigal, especially those caught in rivers or other water bodies, are the most expensive and command high prices in the market. Consumption of marine fish is largely confined to coastal communities in areas like Chittagong, Noakhali and the southern coastal islands, and limited to marine species like pomfret, Indian salmon, snappers and jew fish. All marine fish, except pomfrets and hilsa, command relatively low prices.
Marketing of fish
The fish market at the primary catch stage is very non-competitive. As a result, exploitation by intermediaries, particularly wholesalers/Aratdars, is high in the secondary and higher secondary markets, which resemble oligopoly-type markets. Hence, fishing communities remain poor. Many retailers in primary retail markets compete fiercely among each other. Fifty-five percent of fish vendors sell fresh fish in rural primary markets, 17% deal in live fish, and dry fish sellers constitute 7% of all vendors dealing in fish. Prices of fish are determined by demand for and supply of fish quantities in the retail markets. The usual practice for pricing fish is still bargaining based on visual estimations. Strict grading, sifting and price tagging is usually ignored in retailing. No enforcement of any kind exists for maintaining quality or a standard for weighing. Fair pricing according to grade, size, origin and freshness may not be possible in the absence of standard norms of marketing practices and lack of enforcement by the legal authorities. Present types of fish-market structures and practices are unfavourable for access by economically weaker consumers. Four levels of market are involved in the distribution of fish, which are:
The broadly used fish market channel (product distribution route) is: Fisherman Nikary ® Bepari/Chalani ® Aratdar ® Paiker/retailer ® consumer. Several other marketing channels are also indicated in the text.
Total cost of handling per quintal of fish (mixed species) from farm gate to ultimate consumer is Tk 661 on average (Tk 6.61/kg). In total marketing costs, the share of Aratdar's commission was the highest component, followed by the intermediary's personal expenses (food and drinks). Of total marketing costs, transportation cost was 16%. Beparies' profit (net margin), expressed as percentage share of purchase price, amounted to 11%, while the paiker/retailer earned 17% of net margin of their purchase price. A fish farmer gets, on average, 56% of the price paid by consumers, i.e. 44% of the ultimate consumer price is funnelled to intermediaries for performing different functions in the market.
Only 16% of fish farmers had access to institutional credit (banks/NGOs). Altogether, 31% of fishpond farmers were able to secure loans from both institutional and non-institutional (friends/relatives/money lenders) sources in 1998/99. Many fishpond farmers remain unable to obtain institutional financing, although they are engaged in an apparently profitable agricultural activity.
Socio-economic conditions of fish farmers
Seventy-nine percent of fish farmers are 15 to 50 years of age, the prime active age-range of human beings. Twenty-one percent of fish farmers are over 50 years old. Most of the people engaged in fish culture fall into the active age-range.
Sixty-seven percent of the decision-makers have acceptable levels of formal education. Quite a large number (33%) of fish farmers are still illiterate, yet they have become entrepreneurs in fish culture. Forty-seven percent of fish farmers' main economic activity is crop-production. Fish culture, as a prime economic activity, is pursued by 17% of fish farming households. Small-scale farmers often pursue activities in fish culture (20%) as their prime economic activity.
In rural areas, the situation for earning an income has improved significantly, and with rising income, consumption expenditure has decreased in percentage terms (as Engel's law predicts for the developing stage). Share of consumption expenditure to total expenditure has diminished, yet in both rural and urban areas, shares of expenditure on fish, meat, milk and milk products and fruits have increased. The share of fish expenditure was 14% in rural areas, 11% during 1995/96. Share of expenditure on fish consumed rose for all land-size groups, including landless families, in 1995/96 over the year 1991/92. The highest increase has taken place for landless families during that period (Table 30). Real income per caput has increased at a rate of 4%, while the share of expenditure on fish has increased 5.29% per annum during the first few years of the nineties. Expenditure elasticity of demand for fish and all food in 1995/96 has been estimated as 0.79 and 0.60 respectively. That is, a 10% increase in total expenditure will boost fish expenditure by 7.9%, while expenditure on all food items will increase 6%. Fish is a superior commodity among food items.
In the 116 farm families surveyed, 76% of women actively participated in fish-culture activities. The present survey revealed that in 72% of small farm households, 81% of medium- and 76% of large farm households, women participated in pond-cultural activities. Farmers' wives participated more than other female family members. Women participated in preparing feed, feeding, applying fertilizers and guarding ponds during the daytime.
Conclusions and recommendations
The increase in fish demand per annum will be around 4.90% (increase in real income of 4% per caput with a positive expenditure elasticity of 0.79 and an increase in population of 1.70% per annum). Even if fish production continues to rise at the present rate of production (4.68%), it will barely keep pace with the increased level of demand from a growing population with an increase in real income. However, to reduce the gap between desired level of fish protein intake (50 g a day per person) and actual protein intake, the present level of production (1.37 million t) needs to be raised to 2.19 million t for 120 million people (an increase of 160%). To achieve such a gigantic increase, fish harvested from freshwater and brackish water, as well as catches of marine fishes need to increase substantially. For production on industrial scale to take place (a case study has been provided for industry-scale monoculture production) the private sector would need to be encouraged and supported through government policies.
Depletion of small, indigenous fishes in common-property water bodies has affected the poorest section of the society the most. The use of surface-water for irrigation must be monitored and should not be exploited to the extent that small fish are eradicated and spawning grounds destroyed. The policy on water-use has to be clearly designed and implemented with a view of maintaining optimal levels of bio-diversity that are ecologically sustainable and economically feasible. Water passages and fish routes should not be disturbed by the construction of roads and highways. We should make every effort to restore natural fish habitats.
Studies on: constraints on the adoption of new technologies, and their socio-economic impact; cost-benefits of comparative species; problems relating to inputs; marketing of fish products; and on the potentials of export/import, etc. are altogether absent in the Fisheries Research Institute's (FRI) thrust in research. Hence, there is considerable scope for research in the area of post-harvest or post-catch losses of fish.
Standardization in weighing, enforcement of open-price bidding to control quality, necessary grading and price-tagging per unit in market transactions may make trading in fish less exploitative for consumers. Supervision and enforcement of regulations by public authorities are essential for making fish markets competitive and efficient.
Immediate action is needed to stop the discharge of industrial toxic pollutants into rivers and open water bodies to save aquatic living resources and to maintain their natural recruitment. Open water bodies are still major sources of freshwater fish in the country.
The lack of quality fish fry/spawn is a serious problem for the pond fisheries and an obstacle for expansion. Training of personnel and extension services for hatchery and nursery pond managers need to be expanded and intensified by the Department of Fisheries (DOF) and NGOs.
