The Rise and Fall
of a Shrimp Farm in South Africa

Laurence Evans has compiled a remarkable amount of data on the shrimp farm he managed in South Africa and published it as a 77-page report that chronicles his battle to make the farm work.  That battle came to an end in 2004.  His biggest enemies were a short season (29° S Lat), foreign shrimp imports and, in the end, the crushing drop in shrimp prices from 2000 to 2004.

In the report, Evans lays out every aspect of the farm’s operation.  He lists every piece of equipment, all his supplies and suppliers, all his feed formulations, even his sales and production figures.  He uses maps, 27 color photographs, 17 tables, 9 charts and 7 pages of references to bring the farm back to life as a PDF.

Shrimp News emailed Evans, who some of you may know from his occasional comments on the Shrimp List, and asked him what he was up to now.

Laurence Evans: I have been unemployed for most of 2009, but have had a bit of work from the Food and Agriculture Organization of the United Nations (FAO), writing a species profile for Fenneropenaeus indicus and Penaeus monodon.

One thing I did not mention in my report was that I used a financial modeling spreadsheet from Texas A&M University developed by Wade Griffin and Granvil Treece.  Called A Guide to the Financial Analysis of Shrimp Farming, it’s the most user-friendly aquaculture financial model I have come across, and I have used quite a few.

Topics Covered in Evans’ Report

Excerpts from Evans’ Report

Summary: Amatikulu Prawns (Pty.), Ltd., operated as a commercial shrimp farm from 1989 to 2004 when market forces made producing shrimp unviable and the farm closed.  The farm had two sites north of Durban, South Africa: a 10-hectare farm in Amatikula and a 24-hectare farm in Mtunzini, along with two hatcheries, a HACCP-certified processing plant and a feed mill.  In the beginning, it grew Penaeus monodon, but switched to P. indicus when the quality and availability of the local monodon deteriorated.  The design, pond layout and low average salinities at the Mtunzini site made its management more difficult than the Amatikulu site.  Together, the farms were viable until 2004.

Amatikulu Farm	Mtunzini Farm

Production History: A temperate climate with cold winters meant that only one crop per year could be produced.  Pond water temperatures dropped to below 20°C in early May and slowly rose through August and September to above 23°C.  Only one crop per year was possible.  This was the main factor leading to our inability to compete and remain viable when market prices fell.

Aeration: We used paddlewheels during growout.  Two horsepower paddlewheels deliver about 3.79 kg O₂ per hour.  We used four to five 2-HP (1.5 kW) paddlewheels per hectare or roughly one 2-HP paddlewheel per ton of shrimp.  This was eventually translated into one HP of paddlewheel aeration per 10 kg of feed (7,000 kg final yield with 2% feed per day = 140 kg per day = 14 HP aeration = 7 paddlewheels).  Up to 50 kg per ha of feed can be fed without aeration.  Aeration using paddlewheels should be started before the oxygen level drops below 4 ppm as this is the minimum optimum dissolved oxygen (DO) level to break up temperature stratification and to prevent super-saturation.  The lethal DO for shrimp is close to 1 ppm.

Market Prices: In 2004, the market was flooded with cheap head-on tiger shrimp from India, our neighbor across the Indian Ocean.  This coincided with the dumping regulations that the USA imposed against a number of countries, including India.  This was the final nail in the coffin for our local market.  Some product that India could no longer send to the USA landed in South Africa at between $4 and $5 per kg for 20/30 count per kg head-on tiger shrimp.  In India, shrimp prices crashed from $9.68 to $12.90 to $4.73 per kg, while the cost of production was $5.38.  The generally low international prices and strong Rand also made our export market less viable.

Owner of the Farm: The director and owner of the farm, Mr. Stephanus Myburgh, was killed in a motor accident in 2002.  His son put the farm up for sale at $1.55 million, which included 140 metric tons of shrimp in the ponds and debts of $200 thousand.  We had been trying from before 2002 to secure extra funding, so by the harvest of 2004, we saw that without extra funding, an expansion and improved operational efficiencies, we would go bankrupt if we entered the 2005 season.  Neither Mr. Myburgh nor I was prepared to risk bankruptcy because to intentionally incur debts knowing that bankruptcy was likely is a criminal offence in South Africa.

Shrimp News: To get a free PDF of Evans’ report, click on the link in the Source below, but be prepared for a slow download because it’s a five megabyte file.  I’ve downloaded the file via broadband cable a few times and it has taken between 20 seconds and a minute.  When the file opens, click on the link that reads “A PDF version of this case study is available”.  You will find that link between the Title and Summary.  In the window that opens, you will be able to save the PDF to your computer and view it in full color.  If you want to take a look at the color pictures first, they’re at the end of the PDF file.

Information: Laurence Evans (ecotao@yahoo.com).  Ecotao Enterprises, P.O. Box 1524, Stanger 4450, South Africa.  Evans has two web pages: one for consulting and one for an aquaculture supply company he is developing.

Sources: 1. Case Study: The Rise and Demise of the Commercial Shrimp Farm, Amatikulu Prawns (Pty) Ltd., 1989 to 2004 (Kwazulu Natal, South Africa).  [If the previous link does not work, copy and paste the following URL into your web browser and hit return: https://aquaculturecompendium.wiki.zoho.com/Rise-and-demise-of-a-commercial-shrimp-farm-in-South-Africa.html]. EC FP7 Project.  SARNISSA.  Laurence Evans.  May 2009.  2. Emails to Shrimp News International from Laurence Evans in October 2009.  3. Bob Rosenberry, Shrimp News International, October 27, 2009.

Country Reports

Australia

Western Australia—Crab Farm

Westralian Seafoods has received an aquaculture license from the Department of Fisheries for a commercial mud crab operation in Western Australia.  It will use ponds, but the crabs will be housed in individual cages within the ponds.  Construction of the ponds has started.  Project manager Chris Lim, 37, said stocking would begin in 2010 and the first harvest would take place in 2011.  It took him about 18 months to get all the necessary government permits for what promises to be the first mud crab farm in Western Australia.

Lim said it takes up to a year for mud crabs to reach market size, when they sell for about $35 a kilogram.

Source: Kimberleyecho.com.  Wyndham Mud Crabs Set for Asia.  Jessica Strutt.  October 16, 2009.

Brunei

Government Encouraging Freshwater Prawn Farming

The Fisheries Department has hired a team of consultants to carry out a rapid assessment of the status of freshwater prawn (Macrobrachium rosenbergii) farming in the country, said Fisheries Director Hjh Hasnah Ibrahim, at a training program on prawn farming.  “The government is planning to develop...sites and provide them with basic amenities such as access roads, electricity and water supply...for the operation of commercial-scale freshwater fish or prawn farming,” said Hjh Hasnah.

Source: The Brunei Times.  Temburong Prawn Output Plummets.  Hadi DP Mahmud.  October 13, 2009.

India

It’s OK to Farm Penaeus vannamei

Beginning in February 2010, according to P. Krishnaiah, chief executive officer of the National Fisheries Development Board (NFDB), shrimp farmers will be allowed to grow the western white shrimp, Penaeus vannamei, in India.

But India has not given up on the giant tiger shrimp, P. monodon.  In conjunction with Moana Technologies, NFDB will set up a specific pathogen-free (SPF) distribution center for tiger shrimp postlarvae in Andhra Pradesh.  NFDB will build the facility and then lease it to Moana Technologies, which hopes to produce 3 billion SPF postlarvae a year.

That project, Krishnaiah said, “...is mired in technical issues as Moana is now looking at replacing its partners in India.”  But he emphasized, “The project is not off.”  NFDB just wanted Moana to prove its funding capabilities before proceeding with construction.  NFDB is now preparing to call for bids on the project.

Source: Business Standard.  White Prawn Cultivation to Begin from February.  B. Krishna Mohan.  October 13, 2009.

Indonesia

Shrimp Farmers Oppose Imports

The Indonesian Shrimp Club (ISC), a shrimp farmers association, doesn’t like the government’s plan to open the country to shrimp imports while the farming industry works out its production problems.  “Shrimp farmers fear that the shrimp price will be controlled and imported shrimps will create the threat of antibiotic contamination,” said M. Safwin, chairman of the ISC, on October 13, 2009.

Source: Seafood.com (an online, subscription-based, fisheries news service).  Indonesia’s Shrimp Farmers Oppose Government Plan to Allow Shrimp Imports for Processors, Reshippers.  Ken Coons (phone 1-781-861-1441, email kencoons@seafood.com).  Editor and Publisher, John Sackton (phone 1-781-861-1441, email jsackton@seafood.com).  October 14, 2009.

Indonesia

Mangrove Destruction Continues

Over the past year, the destruction of mangroves in Lampung Province by shrimp farmers has increased at an alarming pace.  In one area, 160,000 hectares of mangroves were reduced to 20,000 hectares.  Mr. Hendrawan, director for the Lampung Chapter of the Indonesian Forum for the Environment (WALHI), said, “A large portion of these areas is believed to have been cleared by two large-scale hatchery companies.”  He declined to name the companies.

Sumarno, 45, a rice farmer, said many coastal residents sold their rice paddies to newcomers from Jakarta and Central Java over the past two years.  He sold his land last year because it could no longer be used to grow rice.  “We were forced to sell our land because it was no longer productive and sea water had permeated the groundwater because of severe coastal abrasion,” Sumarno said.

A South Lampung environmental official said the regency had virtually no mangrove forests left and many areas of its remnant mangrove wetlands were in critical condition.

Source: The Jakarta Post.  Mangroves Disappearing Fast with Global Appetite for Shrimp.  Oyos Saroso H.N.  October 16, 2009.

Philippines

CP Expansion

Over the next two years, Thailand’s food conglomerate Charoen Pokphand will spend $40 million to expand its operations on the island of Luzon.  Agriculture Secretary Arthur C. Yap said the Thai firm’s wholly owned subsidiary, Charoen Pokphand Foods Philippines Corp, is looking to establish feed mills, farms and shrimp hatcheries.

Source: BusinessMirror.com.ph.  Charoen Pokphand to Spend $40M for Expansion in RP.  Jennifer A. Ng.  October 14, 2009.

Saudi Arabia

National Prawn Company—Phase Two

The National Prawn Company (NPC), a large, integrated shrimp farm on the Red Sea, is set to invest $250 million into Phase II of its shrimp farming operations.  It will also open a cold storage facility in Dubai aimed at expanding its fresh and frozen shrimp offerings in the United Arab Emirates.

On October 14, 2009, Peter Fraser, director of commercial development at National Prawn Company, said, “The UAE is a sophisticated market and we anticipate a growing demand for fresh, frozen, raw and cooked shrimp.  NPC will produce roughly 45,000 tons of shrimp by 2012, and we expect to sell up to 25 percent of it in this region.”

Source: TradeArabia.com.  NPC to Invest $250 Million in Prawn Farming.  October 14, 2009.

United States

Arizona—Four Distinct Lineages of Taura

In this study, researchers used computerized, phylogenetic analysis to determine the evolutionary relationships among 83 isolates of the Taura virus.  The analysis revealed four distinct lineages—Mexico, Belize, Southeast Asia and Venezuela–and determined the ancestral population was from Ecuador.  In addition, the Taura mutation rate was estimated as 2.37 x 10 substitutions/site/year, indicating that Taura evolves faster than most other RNA viruses.

Source: The Global Aquaculture Advocate.  Editor, Darryl Jory (dejry2525@aol.com).  Health Management/Evolutionary History of Taura Syndrome Virus.  Kathy F.J. Tang, Ph.D. (fenglyu@u.arizona.edu, Department of Veterinary Science and Microbiology, University of Arizona Tucson, Arizona 85721, USA), Joel O. Wertheim, Solangel A. Navarro and Donald V. Lightner.  Volume 12, Issue 5, Page 104, September/October 2009.

United States

Florida—Quick and Easy Vibrio Checks

A new quick and inexpensive diagnostic test developed by DuPont Qualicon and refined by the University of Florida’s Institute of Food and Agricultural Sciences could make weeding out Vibrio-laden shrimp much more practical and efficient.  The test is based on a technology called “quantitative polymerase chain reaction,” or QPCR diagnostics.  Given a small sampling of shrimp, the system tracks genetic material found in three harmful species of Vibrio by amplifying their DNA into large amounts that are easily detected.

This is the first time that this technology has been used in detecting pathogens in seafood on an industrial scale.  After initially developing the basic lab-bench test, DuPont turned to UF to prepare it for regulatory approval and commercial use.

Source: Seafood.com (an online, subscription-based, fisheries news service).  Dupont Qualicon Rapid Inexpensive Test Adapted at University of Florida for Use in Detecting Vibrio.  Ken Coons (phone 1-781-861-1441, email kencoons@seafood.com).  Editor and Publisher, John Sackton (phone 1-781-861-1441, email jsackton@seafood.com).  October 16, 2009.

United States

Gulf of Mexico—Shrimp Fishery

With competition among foreign shrimp suppliers already fierce and margins at razor-thin levels, the huge shrimp catch coming out of the Gulf of Mexico is creating lots of problems.  Production from the Gulf is about 35 percent higher than last year and might equate to about 40 million additional pounds by year’s end, said Ernie Wayland of International Marketing Specialists.  “This is not a biggie except if you are a Gulf fisherman or packer,” he said.

Warehouses still full with last year’s catch, particularly large sizes like 16-20s, don’t have space—or customers—to take the newly caught product.  “We have heard that many packing houses have been turning boats away, as they cannot or will not buy the product to add onto what they already have,” said Wayland.  “This is a sad situation, particularly for the fishermen.  No one is making any money, except the processors and traders.  We hear that more and more boats are tying up and are not fishing as the cost exceeds the return.  This has been a pattern for many years.”

When asked if the dumping case helped domestic processors, Wayland said, “The answer is some of them...got large Byrd money payments that exceeded their wildest dreams.  In my opinion, the biggest problem for the Gulf producers is that they have very limited branding and marketing programs to allow their product to sell consistently at higher prices.”

“Retailers have gotten in the habit of charging high prices for shrimp in recent years to help offset some sluggish margins from their meat departments,” he said.  “I believe what we are seeing is more marketing efforts to offer consumers deals on shrimp and more realistic pricing to induce purchases.  Across the board, consumption continues to lag, generally in sync with the recession effects.  But there is no shortage of shrimp in the market place.”

Source: Boletin Informativo (Ecuador’s Camara Nacional de Acuacultura).  Editor, Jorge Tejada (jtejada@cna-ecuador.com).  Too much shrimp, not enough marketing.  October 6, 2009.

United States

Washington, DC— FDA’s Reportable Food Registry

The USA Food and Drug Administration (FDA) launched its new electronic Reportable Food Registry on September 8, 2009.  The Food Registry will assist USA health authorities trace potentially hazardous foods.  FDA requires that all food facilities must file an electronic report within 24 hours of becoming aware of a “reportable food”.  A “reportable food” is defined as any food product that has a “reasonable probability” of causing health problems or death in humans or animals.  Examples include bacterial contamination, allergen mislabeling and the presence of certain chemicals at high levels.  It is not necessary for food companies to submit reports if a problem was found and resolved before products were shipped, but reports must be filed if there are conflicting lab tests.  Companies can file an electronic report at: http://www.fda.gov/Food/FoodSafety/FoodSafetyPrograms/RFR/default.htm.

Failure to file a report on time will subject the responsible party to a wide range of criminal and civil penalties, which could include incarceration, fines and injunctions.

To file a report, companies must have an active 11-digit facility registration number for their food facility.  Registrar Corp can verify that your company has an active 11-digit facility registration number.

Certificates of Registration issued by Registrar Corp provide confirmation to the industry that you are fulfilling FDA registration requirements.  Registrar Corp is not affiliated with the USA Food and Drug Administration.  FDA does not issue or recognize Certificates of Registration.

Information: Registrar Corp., 144 Research Drive Hampton, Virginia 23666, USA (phone 1-757-224-0177, fax 1-757-224-0179, webpage http://www.registrarcorp.com).

Source: Email to Shrimp News International from Agreima on October 16, 2009.

Vietnam

Rotating Shrimp with Rice in the Mekong Delta

Under a blazing sun in Dong Thap Province, Vo Thi Nhieu and her husband are absorbed in reinforcing their levees to prepare their newly harvested rice field for the upcoming shrimp crop.  The work is harder than last year because they decided to expand the shrimp farm by half a hectare this year.  “We have adopted the practice of shrimp-rice farming for the last three years.  We used to cultivate only a one-hectare field.  The profits we made from it encouraged us to expand this year,” said Nhieu.

“Last year my family earned $3,300 from one hectare, with $2,500 of that coming from shrimp.  It has helped us lead a much easier life.  Besides buying appliances necessary for a modern family, like a television, refrigerator, video and even a computer, we can now afford to send our four children to high school and university.  Three years ago my family grew only rice, earning $335 or $392 per year.  My husband and I had to do other jobs, including hawking during the rest of the year to support the family.”

There has also been an unexpected windfall from farming shrimp.  Nhieu explains: “In the past, before we took up shrimp farming, we often had to use 30 sacks of fertilizers for our one hectare paddy.  But we now need only 12 because the field has become more fertile, thanks to the waste produced by the shrimp and other organic residue.  We have cut farming costs by more than half.”

Last year, seven provinces in the delta, including Tra Vinh, Bac Lieu, Soc Trang, Ca Mau, Ben Tre, Kien Giang and Long An adopted shrimp-rice farming on a combined 120,000 hectares, 23 percent of the Mekong Delta’s total arable land.

Dr. Do Minh Nhut, director of the Kien Giang Agricultural and Fishing Centre, said shrimp-rice farming is now the first option in his province, with farmers adopting the system on 70,000 hectares, the largest area in the region.  It is expected to expand to around 100,000 hectares in the coming years, he said.

For an example of rice/shrimp rotation in India, click here.

Source: Vietnam News Agency.  Shrimp-Rice Bring Hope to Delta.  Thien Ly.  October 18, 2009.

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