The Annual Economic Survey of Federal Gulf Shrimp Permit Holders: Report on the Design, Implementation, and Descriptive Results for 2006

This technical memorandum documents the design, implementation, data preparation, and descriptive results for the 2006 Annual Economic Survey of Federal Gulf Shrimp Permit Holders. The data collection was designed by the NOAA Fisheries Southeast Fisheries Science Center Social Science Research Group to track the financial and economic status and performance by vessels holding a federal moratorium permit for harvesting shrimp in the Gulf of Mexico. A two page, self-administered mail survey collected total annual costs broken out into seven categories and auxiliary economic data. In May 2007, 580 vessels were randomly selected, stratified by state, from a preliminary population of 1,709 vessels with federal permits to shrimp in offshore waters of the Gulf of Mexico. The survey was implemented during the rest of 2007. After many reminder and verification phone calls, 509 surveys were deemed complete, for an ineligibility-adjusted response rate of 90.7%. The linking of each individual vessel’s cost data to its revenue data from a different data collection was imperfect, and hence the final number of observations used in the analyses is 484. Based on various measures and tests of validity throughout the technical memorandum, the quality of the data is high. The results are presented in a standardized table format, linking vessel characteristics and operations to simple balance sheet, cash flow, and income statements. In the text, results are discussed for the total fleet, the Gulf shrimp fleet, the active Gulf shrimp fleet, and the inactive Gulf shrimp fleet. Additional results for shrimp vessels grouped by state, by vessel characteristics, by landings volume, and by ownership structure are available in the appendices. The general conclusion of this report is that the financial and economic situation is bleak for the average vessels in most of the categories that were evaluated. With few exceptions, cash flow for the average vessel is positive while the net revenue from operations and the “profit” are negative. With negative net revenue from operations, the economic return for average shrimp vessels is less than zero. Only with the help of government payments does the average owner just about break even. In the short-term, this will discourage any new investments in the industry. The financial situation in 2006, especially if it endures over multiple years, also is economically unsustainable for the average established business. Vessels in the active and inactive Gulf shrimp fleet are, on average, 69 feet long, weigh 105 gross tons, are powered by 505 hp motor(s), and are 23 years old. Three-quarters of the vessels have steel hulls and 59% use a freezer for refrigeration. The average market value of these vessels was $175,149 in 2006, about a hundred-thousand dollars less than the average original purchase price. The outstanding loans averaged $91,955, leading to an average owner equity of $83,194. Based on the sample, 85% of the federally permitted Gulf shrimp fleet was actively shrimping in 2006. Of these 386 active Gulf shrimp vessels, just under half (46%) were owner-operated. On average, these vessels burned 52,931 gallons of fuel, landed 101,268 pounds of shrimp, and received $2.47 per pound of shrimp. Non-shrimp landings added less than 1% to cash flow, indicating that the federal Gulf shrimp fishery is very specialized. The average total cash outflow was $243,415 of which $108,775 was due to fuel expenses alone. The expenses for hired crew and captains were on average $54,866 which indicates the importance of the industry as a source of wage income. The resulting average net cash flow is $16,225 but has a large standard deviation. For the population of active Gulf shrimp vessels we can state with 95% certainty that the average net cash flow was between $9,500 and $23,000 in 2006. The median net cash flow was $11,843. Based on the income statement for active Gulf shrimp vessels, the average fixed costs accounted for just under a quarter of operating expenses (23.1%), labor costs for just over a quarter (25.3%), and the non-labor variable costs for just over half (51.6%). The fuel costs alone accounted for 42.9% of total operating expenses in 2006. It should be noted that the labor cost category in the income statement includes both the actual cash payments to hired labor and an estimate of the opportunity cost of owner-operators’ time spent as captain. The average labor contribution (as captain) of an owner-operator is estimated at about $19,800. The average net revenue from operations is negative $7,429, and is statistically different and less than zero in spite of a large standard deviation. The economic return to Gulf shrimping is negative 4%. Including non-operating activities, foremost an average government payment of $13,662, leads to an average loss before taxes of $907 for the vessel owners. The confidence interval of this value straddles zero, so we cannot reject, with 95% certainty, that the population average is zero. The average inactive Gulf shrimp vessel is generally of a smaller scale than the average active vessel. Inactive vessels are physically smaller, are valued much lower, and are less dependent on loans. Fixed costs account for nearly three quarters of the total operating expenses of $11,926, and only 6% of these vessels have hull insurance. With an average net cash flow of negative $7,537, the inactive Gulf shrimp fleet has a major liquidity problem. On average, net revenue from operations is negative $11,396, which amounts to a negative 15% economic return, and owners lose $9,381 on their vessels before taxes. To sustain such losses and especially to survive the negative cash flow, many of the owners must be subsidizing their shrimp vessels with the help of other income or wealth sources or are drawing down their equity. Active Gulf shrimp vessels in all states but Texas exhibited negative returns. The Alabama and Mississippi fleets have the highest assets (vessel values), on average, yet they generate zero cash flow and negative $32,224 net revenue from operations. Due to their high (loan) leverage ratio the negative 11% economic return is amplified into a negative 21% return on equity. In contrast, for Texas vessels, which actually have the highest leverage ratio among the states, a 1% economic return is amplified into a 13% return on equity. From a financial perspective, the average Florida and Louisiana vessels conform roughly to the overall average of the active Gulf shrimp fleet. It should be noted that these results are averages and hence hide the variation that clearly exists within all fleets and all categories. Although the financial situation for the average vessel is bleak, some vessels are profitable. (PDF contains 101 pages)

Early-life-history profiles, seasonal abundance, and distribution of four species of Carangid larvae off Louisiana, 1982 and 1983

We present data on ichthyoplankton distribution, abundance, and seasonality and supporting environmental information for four species of coastal pelagics from the family Carangidae: blue runner Caranx crysos, Atlantic bumper Chloroscombrus chrysurus, round scad Decapterus punctatus, and rough scad Trachurus lathami. Data are from 1982 and 1983 cruises off Louisiana sponsored by the Southeastern Area Monitoring and Assessment Program (SEAMAP). Bioprofiles on reproductive biology, early life history, meristics, adult distribution, and fisheries characteristics are also presented for these species. Maximum abundances of larval blue runner, Atlantic bumper, and round scad were found in July inside the 4O-m isobath, although during the rest of the cruises these species were rarely found together. Larval Atlantic bumper were captured in June and July only; blue runner in May, June, and July; and round scad in all seasons. Atlantic bumper larvae, concentrated mostly off western Louisiana, were by far the most abundant carangid in 1982 and 1983. Larval blue runner were the second most abundant summer-spawned carangid in 1982 and 1983, but their abundance and depth distribution varied considerably between years. Relative abundance of larval round scad off Louisiana was low, and they were captured only west of the Mississippi River delta, although they are reported to dominate carangid populations in the eastern Gulf of Mexico. Rough scad were primarily winter/spring and outer-shelf (40-182 m) spawners. They ranked third in overall abundance, but were the most abundant target carangid on the outer shelf. Ecological parameters such as surface salinity, temperature, and station depth are presented from capture sites for recently hatched larvae <2.5 mm notochord length, except round scad) as well as for all sizes of fish below 14 mm standard length. (PDF file contains 44 pages.)

Reproduction, maturation, and seed production of cultured species: Proceedings of the Twelfth U.S.-Japan Meeting on Aquaculture, Baton Rouge, Louisiana, October 25-29, 1983

The United States and Japanese counterpart panels on aquaculture were formed in 1969 under the United States-Japan Cooperative Program in Natural Resources (UJNR). The panels currently include specialists drawn from the federal departments most concerned with aquaculture. Charged with exploring and developing bilateral cooperation, the panels have focused their efforts on exchanging information related to aquaculture which could be of benefit to both countries. The UJNR was begun during the Third Cabinet-Level Meeting of the Joint United States-Japan Committee on Trade and Economic Affairs in January 1964. In addition to aquaculture, current subjects in the program include desalination of seawater, toxic microorganisms, air pollution, energy, forage crops, national park management, mycoplasmosis, wind and seismic effects, protein resources, forestry, and several joint panels and committees in marine resources research, development, and utilization. Accomplishments include: Increased communication and cooperation among technical specialists; exchanges of information, data, and research findings; annual meetings of the panels, a policy-coordinative body; administrative staff meetings; exchanges of equipment, materials, and samples; several major technical conferences; and beneficial effects on international relations. (PDF file contains 79 pages.)

Mississippi River sustenance of brown shrimp (Farfantepenaeus aztecus) in Louisiana coastal waters

Brown shrimp (Farfantepenaeus aztecus) are abundant along the Louisiana coast, a coastline that is heavily influenced by one of the world’s largest rivers, the Mississippi River. Stable carbon, nitrogen, and sulfur (CNS) isotopes of shrimp and their proventriculus (stomach) contents were assayed to trace riverine support of estuarine-dependent brown shrimp. Extensive inshore and of fshore collections were made in the Louisiana coastal zone during 1999–2006 to document shrimp movement patterns across the bay and shelf region. Results showed an unexpectedly strong role for nursery areas in the river delta in supporting the offshore fishery, with about 46% of immigrants to offshore regions arriving from riverine marshes. Strong river influences also were evident offshore, where cluster analysis of combined CNS isotope data showed three regional station groups related to river inputs. Two nearer-river mid-shelf station groups showed isotope values indicating river fertilization and productivity responses in the benthic shrimp food web, and a deeper offshore station group to the south and west showed much less river inf luence. At several mid-shelf stations where hypoxia is common, shrimp were anomalously 15N depleted versus their diets, and this d15N difference or mismatch may be useful in monitoring shrimp movement responses to hypoxia.

Age, growth, mortality, and radiometric age validation of gray snapper (Lutjanus griseus) from Louisiana

The gray snapper (Lutjanus griseus) is a temperate and tropical reef fish that is found along the Gulf of Mexico and Atlantic coasts of the southeastern United States. The recreational fishery for gray snapper has developed rapidly in south Louisiana with the advent of harvest and seasonal restrictions on the established red snapper (L. campechanus) fishery. We examined the age and growth of gray snapper in Louisiana with the use of cross-sectioned sagittae. A total of 833 specimens, (441 males, 387 females, and 5 of unknown sex) were opportunistically sampled from the recreational fishery from August 1998 to August 2002. Males ranged in size from 222 to 732 mm total length (TL) and from 280 g to 5700 g total weight (TW) and females ranged from 254 to 756 mm TL and from 340 g to 5800 g TW. Both edge analysis and bomb radiocarbon analyses were used to validate otolith-based age estimates. Ages were estimated for 718 individuals; both males and females ranged from 1 to 28 years. The von Bertalanffy growth models derived from TL at age were Lt = 655.4{1–e[–0.23(t)]} for males, Lt = 657.3{1–e[– 0.21(t)]} for females, and L t = 656.4{1–e[– 0.22 (t)]} for all specimens of known sex. Catch curves were used to produce a total mortality (Z) estimate of 0.17. Estimates of M calculated with various methods ranged from 0.15 to 0.50; however we felt that M= 0.15 was the most appropriate estimate based on our estimate of Z. Full recruitment to the gray snapper recreational fishery began at age 4, was completed by age 8, and there was no discernible peak in the catch curve dome.

Bay Scallops, Argopecten irradians, in the Northwestern Gulf of Mexico (Alabama, Mississippi, Louisiana, and Texas)

There is no evidence that a commercial bay scallop fishery exists anywhere in the northwestern Gulf of Mexico. No data concerning scallop abundance or distribution was found for Alabama, Mississippi, and Louisiana. Texas is the only state west of Florida where bay scallop populations have been documented. These records come from a variety of literature sources and the fisheries-independent data collected by Texas Parks and Wildlife Department (1982–2005). Although common in the diet of prehistoric peoples living on the Texas coast, recent (last ~50 years) bay scallop population densities tend to be low and exhibit “boom–bust” cycles of about 10–15 years. The Laguna Madre, is the only place on the Texas coast where scallops are relatively abundant; this is likely due to extensive seagrasses cover (>70%) and salinities that typically exceed 35 psu. The lack of bay scallop fishery development in the northwestern Gulf of Mexico is probably due to variable but generally low densities of the species combined with a limited amount of suitable (i.e. seagrass

Skimmer Trawl Fishery Catch Evaluations in Coastal Louisiana, 2004 and 2005

Fishery observers collected data from 307 tows during 96 trips aboard skimmer trawl vessels in Louisiana’s coastal waters from September 2004 through June 2005 to estimate catch rates of target and nontarget species, including sea turtles (Cheloniidae and Dermochelyidae), by area and season during commercial shrimping operations. About 16,965.7 kg of total catch were recorded during 517.0 hours of fishing operations. Based on weight extrapolations from species composition samples, penaeid shrimp (Penaeidae) dominated the catch at 66%, followed by finfish at 19%, nonpenaeid shrimp crustaceans at 7%, discarded penaeid shrimp at 6%, and debris at 3%. Noncrustacean invertebrates comprised less than 1%. Catch rates in kilograms per hour by category was 21.6 for penaeid shrimp, 6.2 for finfish, 2.2 for nonpenaeid crustaceans, 1.8 for discarded penaeid shrimp, and 0.9 for debris. White shrimp, Litopenaeus setiferus, other penaeid shrimp, and Gulf menhaden, Brevoortia patronus, were the top three dominant species by weight. Seasonally, a higher catch rate was observed from May through August 2005 for penaeid shrimp as compared with the September through December 2004 period. Conversely, the September through December 2004 period experienced a higher catch rate for finfish than during May through August 2005. No sea turtle interactions were documented.

Estimating the Economic Impact of the Wild Shrimp, Penaeus sp., Fishery: A Study of Terrebonne Parish, Louisiana

Two approaches are used to estimate the economic impact of domestic wild shrimp, Penaeus sp., fishing in Terrebonne Parish, Louisiana. A 2002 survey of commercial shrimp fishermen in the Parish yields information on sales and operating costs, and results are used to estimate a 1-yr sales effect in the Parish of $36.7 to $128.1 million due to shrimp fishing. In addition, 2001 shrimp ticket sales data ($49.9 million) are input into a REMI (Regional Economic Models, Inc.) model built for the 4-parish bayou region of Louisiana. The REMI model forecasts a year 1 reduction in gross regional product (GRP) of $45.9 million in the 4-parish area if the shrimp fishing industry were to disappear in Terrebonne Parish, and an 8-yr cumulative negative impact on GRP in the bayou region of $191.3 million. Study limitations and suggestions for future research are included.

Skimmers: Their Development and Use in Coastal Louisiana

The origin, development, and utilization of the skimmer net is reviewed along with other historical shrimp gears used in coastal Louisiana. The skimmer was developed to catch white shrimp, Penaeus setiferus, observed jumping over the cork line (headrope) of trawls being worked in shallow waters. A description of the gear is presented including basic components and various frame designs used by fishermen during its development. The advantages of skimmers over bottom trawls include: multiple use as both trawl and butterfly net (wing net), ease of deployment, increased maneuverability, reduction and greater survivability of bycatch, and ability to cover more area due to increased speed and continuous fishing capability. Disadvantages may include compromising vessel stability when stored upright on the deck, possible damage to water bottoms when improperly rigged, and limitation to a 12-foot (3.6 m) maximum depth due to size restrictions. The growing popularity of the skimmer net is evident by its introduction into North Carolina and inquiries from other southeastern Atlantic and Gulf coast states.

The National Marine Fisheries Service Habitat Conservation Efforts in Louisiana, 1980 Through 1990

Data quantifying various aspects of the Corps of Engineers wetland regulatory program in Louisiana from 1980 through 1990 are presented. The National Marine Fisheries Service (NMFS) habitat conservation efforts for this time period are described and averages involved delineated. From 1980 through 1990, NMFS reviewed 14,259 public notices to dredge, fill, or impound wetlands in Louisiana and provided recommendations to the Corps on 962 projects which proposed to impact over 600,000 acres of tidally influenced wetlands. NMFS recommended that impacts to about 279,000 acres be avoided and that more than 150,000 acres of compensatory mitigation be provided. During this period, marsh management projects proposed impounding over 197,000 acres of wetlands. On a permit by permit basis, 43% of NMFS recommendations were accepted, 34% were partially accepted, and 23% were rejected.