Print This Page

December 21, 2013

Jamaica

Second Shrimp Farm Quits Shrimp Farming

 

Caribbean Aquaculture Limited (CAL), a shrimp farm with 120 acres ponds that employed 28 on the farm and 60 in its processing plant, has closed down operations due to thievery, power costs and new import duties on feed and postlarvae.  Trans-Global Aquaculture, Ltd., the only other large shrimp farm in Jamaica announced its liquidation earlier in December 2013.

 

Established in 2007, CAL, located at Brampton Farms, Old Harbour Bay, St. Catherine, produced about 20,000 pounds of shrimp monthly, grossing approximately $81 thousand a month at the height of its production.

 

Director Vitus Evans said the company went into liquidation in November 2013, following several failed attempts at staying afloat.  “We are closing down for three main reasons,” said Evans, indicating the most burdensome hindrance to the company’s viability was the 40 percent duty imposed on feed and postlarvae imports.  “With the duty and general consumption tax, the added expense translated to about $8 thousand per container that we imported.  Before the duty, that cost was a zero cost,” Evans said.

 

CAL was initially owned by Caribbean Mariculture Limited, a joint venture between the Jamaica Agricultural Development Foundation (JADF) and the University of the West Indies.  Together, in 2007, they spent in excess of $1.1 million to construct the ponds.  When Caribbean Mariculture Limited went into liquidation in 2007, CAL was formed and leased the ponds from JADF.  Evans said, “When we took over we put in $339,490 to recapitalize the farm....  We were making a profit in the first years of our operation with approximately $38 thousand made in the first year.”

 

The assets of the company, which have been advertised for sale by liquidator Worrick Bogle, are worth $247 thousand.  About $73 thousand in assets have already been sold.  Related parties are owed some $321 thousand.

 

Evans said, “We actually calculated that we were losing at least 10 to 15 per cent of production due to theft.”  He said the company tried “all the security firms that we could think of, but that still did not alleviate the problem,” adding that “security was our third highest cost.”

 

The company paid for electricity based on its production levels and the size of the farm.   Evans said, “Even at times when we closed down the farm for renovation, we still had to pay electricity bills, which were in excess of $3,770 a month.  How it works is that Jamaica Public Service says since they have to produce that electricity for you, whether you use it or not, you have to pay for it.”

 

Evans estimated the company’s total losses at $858 thousand.

 

Source: The Gleaner.  Second Shrimp Farms Goes Out of Business/Praedial Larceny, Tax on Inputs Cited as Reasons.  Tameka Gordon (email tamek.gordon@gleanerjm.com).  December 20, 2013.

Print This Page