WP/81/SPH/CP-17
by
Charles M. Larsen1
1. INTRODUCTION
The cost, construction and maintenance of modern hatcheries are major constraints in the development of commercial shrimp culture and, in many cases, the improvement of hatchery programmes. The lack of research on hatchery construction and the requirement of the species has generally kept aquaculture in a holding pattern instead of reaching the heights so often predicted for it.
All fish cultural installations must be designed to conform to the tolerances of the species for water quality, water quantity, and space factor. Unfortunately, these tolerances are not well-known but with the small amount of available knowledge, great progress can be made in new hatchery designs. Even better designs can come from intensive research on the requirements of species at different size.
The quality of water is of utmost importance since the change in pH of one unit can mean 10 times more or 10 times less production in a given water flow. An equally important criterion is kilograms of shrimp that can be raised in a cubic meter of water. If shrimp can be raised at greater densities, there could be a commensurate reduction in hatchery size. Savings such as this would drastically reduce the cost of hatchery construction and operation.
Other savings could be accomplished by eliminating expensive rearing units in buildings, changing feeding techniques to increase growth rate, developing labor-free incubation units, installing more practical, trouble-free instrumentation, designing an efficient cleaning system specifically adapted to shrimp culture units and utilizing disease-resistant strains.
Another very important aspect of shrimp farm design is cost. How can an expenditure for a shrimp farm be justified in private industry or in a government facility? Is the interest on the money to build the farm sufficient to buy more shrimp than the farm can raise? There have been too many government hatcheries built that fit this description. The interest on the capital expenditure of some of the colossal nightmares would buy more shrimp than the facility can produce.
Hatcheries can be built with a capital cost that can be justified. It is time for the government to stop spending more money for hatcheries than they are worth. Let us hope that from this working party, we can contribute effort and knowledge to the biologist and the engineer and reduce the cost of shrimp farm construction.
2. ECONOMICS
The expansion of commercial interests in shrimp/prawn culture has created the need for a financial analysis format to provide potential investors and creditors with a better understanding to investment opportunities. We need a format with the capability to rapidly develop budgets for different production systems and to provide the investment's return on equity, net present value, break-even prices, and quantity and sensitivity toward input variable charges. Based on data from production systems, biological factors of production with greatest effect on output should be examined. The format should serve as a versatile means by which many conceivable culture systems can be analyzed prior to actual investment to determine economic feasibility.
1 Fisheries Adviser, United States Agency for International Development (USAID), Jakarta, Indonesia
3. SENSITIVITY ANALYSIS
Revenue is most sensitive to yield and size of shrimp. Both of these factors are dependent, in turn, on choice of species and number of crops produced. The projected yields and alternative sizes of shrimp which could be obtained with each species are based on assessment of the potential of a commercial operation over the long-term using present technology. The revenue used in the Income Statement for each species should represent the revenue for the size shrimp most likely to be produced. The projections should be exceeded in experimental studies where proper management practices are followed.
Pond construction and land purchases are normally the largest investment costs. Estimates of construction costs should be based on bids from local contractors with previous related construction experience. The land price should be based on estimates of the current purchase price of agricultural land. Based on pond construction expenditures, the cost per surface area should be determined.
The major operational costs are feed for grow-out, larvae and labour.
4. HATCHERY DESIGN
It may sound trite to say that a hatchery should be designed around the fundamental requirements of species for which it is designed to cultivate. However, there are very few species of shrimp if any, whose basic biological and behavioural requirements are known. Although the principal thrust of biological research has been with fish, the ultimate kilograms of these species that can be reared per cubic meter is still questionable.
If a hatchery is constructed properly, shrimp can be reared at much greater densities than they are now. Indications are that they can be reared at 2.5 to 4 times the densities conceived under present design policies. The savings in structures alone would be immense.
The hatchery design, if based on greater densities of shrimp, will be a far more compact unit. In addition, the rearing units must be large and contiguous. All separate units are units of work and increase labour costs. Circulating ponds almost invariably are small and comprise a unit of work and, do not provide so good an environment as a flow-through type.
5. INSTRUMENTATION
Instrumentation is a controversial subject because it involves factors built into the hatchery. Unfortunately, even though hatcheries have modern instrumentation, much of it is wasted since it is never utilized. The reasons for this waste are relatively simple: (1) much of the instrumentation was superfluous; (2) the personnel did not understand its operation; (3) the facility was not staffed with enough trained people to operate the sophisticated electronics or analyze the data; and (4) the instrumentation had a history of breakdown, which made it difficult to justify its existence.
It would seem that, within reason, the less complex the instrumentation, the cheaper and more efficient is its operation. Flows can be read from permanently installed gauges, and oxygen depletion and metabolite build-up can be anticipated in most instances before they occur.
The above are essentially the parameters that have to be measured, and they are certainly never so complex as the instrumentation sometimes leads us to believe.
6. RISK CONSIDERATION
Because technology to farm shrimp is just becoming established commercially, a high level of risk is anticipated. Construction and operating costs have not been sufficiently documented on a commercial scale to provide the reliability which could be expected. However, since production systems are similar, comparison with other types of aquaculture will provide valuable information to the investor.
The ability to achieve the projected yields and alternative sizes of shrimp will depend primarily on the ability of management to efficiently utilize existing technology. Generally, production technology is not adequately understood yet by persons in upper-level management and in financing who are responsible for providing investment capital and who ultimately make the major decisions which govern production. Management has commonly tended to expand to larger scale production without properly pilot-testing production facilities and resources and provide insufficient capital to cover the unpredictable increase in operational costs which inevitably occur in any new venture.
From a technical standpoint, a successful operation must have land suitable for ponds, access to saltwater of consistant quality, a readily available supply of seed stock and well-trained personnel. Vast acreages of land adjacent to suitable saltwater can be found along most coasts but an expert in site selection should be consulted to provide a proper evaluation of potential locations.
