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)

The market for Egyptian farmed fish

Egypt’s aquaculture production (921,585 tonnes in 2010) is by far the largest of any African country. The aquaculture sector, dominated by semi-intensive pond production of tilapia, makes a significant contribution to income, employment creation and food and nutrition security in the country, all of which are national priority areas given low per capita income levels, rising population, worsening food and nutrition security indicators, and official unemployment levels which have remained at around 10% for the last ten years. The Improving Employment and Income through Development of Egypt’s Aquaculture Sector (IEIDEAS) project funded by the Swiss Agency for Development and Cooperation (SDC) is a three-year project which commenced in December 2011, and which aims to support the development of the aquaculture sector in Egypt so as to increase productivity, profitability, and employment in the sector, and the nutritional status of poor consumers. This report represents the output of a short two-week study to better understand the market for Egyptian farmed fish. The intention of the study was to provide an output which would cut-across, and potentially benefit, all five of the project outcomes.

Women fish vendors in Mumbai: a study report

Government development programmes and policies in fisheries are focused on the problems and needs of men though women are known to dominate the post-harvest sector in artisanal fisheries and are involved, to varying degrees, in pre-harvest and harvest activities. A lack of women’s participation in decision-making bodies within communities, fisheries organizations and government has resulted in a general neglect of their interests. This has led to a constant demand by women’s-rights activists and organizations to address market-related issues of women vendors. This study, “Women Fish Vendors in Mumbai”, aims to provide insights into the challenges faced by women fish vendors in the city of Mumbai (formerly Bombay).

Evaluation of the economic costs and benefits of methods for reducing nutrient loads to the Gulf of Mexico: Topic 6 Report for the Integrated Assessment on Hypoxia in the Gulf of Mexico.

In this report we analyze the Topic 5 report’s recommendations for reducing nitrogen losses to the Gulf of Mexico (Mitsch et al. 1999). We indicate the relative costs and cost-effectiveness of different control measures, and potential benefits within the Mississippi River Basin. For major nonpoint sources, such as agriculture, we examine both national and basin costs and benefits. Based on the Topic 2 economic analysis (Diaz and Solow 1999), the direct measurable dollar benefits to Gulf fisheries of reducing nitrogen loads from the Mississippi River Basin are very limited at best. Although restoring the ecological communities in the Gulf may be significant over the long term, we do not currently have information available to estimate the benefits of such measures to restore the Gulf’s long-term health. For these reasons, we assume that measures to reduce nitrogen losses to the Gulf will ultimately prove beneficial, and we concentrate on analyzing the cost-effectiveness of alternative reduction strategies. We recognize that important public decisions are seldom made on the basis of strict benefit–cost analysis, especially when complete benefits cannot be estimated. We look at different approaches and different levels of these approaches to identify those that are cost-effective and those that have limited undesirable secondary effects, such as reduced exports, which may result in lost market share. We concentrate on the measures highlighted in the Topic 5 report, and also are guided by the source identification information in the Topic 3 report (Goolsby et al. 1999). Nonpoint sources that are responsible for the bulk of the nitrogen receive most of our attention. We consider restrictions on nitrogen fertilizer levels, and restoration of wetlands and riparian buffers for denitrification. We also examine giving more emphasis to nitrogen control in regions contributing a greater share of the nitrogen load.

Ecological and economic consequences of hypoxia: Topic 2 Report for the Integrated Assessment on Hypoxia in the Gulf of Mexico

In this report we have attempted to evaluate the ecological and economic consequences of hypoxia in the northern Gulf of Mexico. Although our initial approach was to rely on published accounts, we quickly realized that the body of published literature deahng with hypoxia was limited, and we would have to conduct our own exploratory analysis of existing Gulf data, or rely on published accounts from other systems to infer possible or potential effects of hypoxia. For the economic analysis, we developed a conceptual model of how hypoxia-related impacts could affect fisheries. Our model included both supply and demand components. The supply model had two components: (1) a physical production function for fish or shrimp, and (2) the cost of fishing. If hypoxia causes the cost of a unit of fishing effort to change, then this will result in a shift in supply. The demand model considered how hypoxia might affect the quality of landed fish or shrimp. In particular, the market value per pound is lower for small shrimp than for large shrimp. Given the limitations of the ecological assessment, the shallow continental shelf area affected by hypoxia does show signs of hypoxia-related stress. While current ecological conditions are a response to a variety of stressors, the effects of hypoxia are most obvious in the benthos that experience mortality, elimination of larger long-lived species, and a shifting of productivity to nonhypoxic periods (energy pulsing). What is not known is whether hypoxia leads to higher productivity during productive periods, or simply to a reduction of productivity during oxygen-stressed periods. The economic assessment based on fisheries data, however, failed to detect effects attributable to hypoxia. Overall, fisheries landings statistics for at least the last few decades have been relatively constant. The failure to identify clear hypoxic effects in the fisheries statistics does not necessarily mean that they are absent. There are several possibilities: (1) hypoxic effects are small relative to the overall variability in the data sets evaluated; (2) the data and the power of the analyses are not adequate; and (3) currently there are no hypoxic effects on fisheries. Lack of identified hypoxic effects in available fisheries data does not imply that effects would not occur should conditions worsen. Experience with other hypoxic zones around the globe shows that both ecological and fisheries effects become progressively more severe as hypoxia increases. Several large systems around the globe have suffered serious ecological and economic consequences from seasonal summertime hypoxia; most notable are the Kattegat and Black Sea. The consequences range from localized loss of catch and recruitment failure to complete system-wide loss of fishery species. If experiences in other systems are applicable to the Gulf of Mexico, then in the face of worsening hypoxic conditions, at some point fisheries and other species will decline, perhaps precipitously.

Report of Catch Assessment Survey of Lake Albert – Albert Nile conducted in July 2012

A Catch Assessment Surveys (CAS) with the overall objective of generating information on the fish production and commercial value of the fisheries of Lake Albert and Albert Nile system was implemented by the National Fisheries Resources Research Institute (NAFIRRI) in collaboration with the Department of Fisheries Resources (DFR), Local Government staff (FOs) and BMU members at selected landing sites on Lake Albert (12 landing sites) and Albert Nile (26 landing sites) in July 2012. A total 622 and 313 boat days on Lake Albert and Albert Nile respectively were sampled for a period of 9 days. Results indicate an annual landing of 151,600 and 5,900 tonnes (t) of fish with an estimated beach value of 122.5 and 14 Billion (UShs) from Lake Albert and Albert Nile respectively. Over 80% of the catch from Lake Albert comprised the small pelagic species; Neobola bredoi (Muziri) and Brycinus nurse (Ragoogi) followed by Nile perch (6%). However, due to low market value of the small fishes and the high prices attached to Nile perch for industrial processing and export market, the contribution of the latter to beach value rose to 34% of the total. The contribution of the light fishery based on small pelagic species (B. nurse and N. bredoi) are insignificant on Albert Nile. Even if the small pelagic species may be present in the river system, a light fishery based on these two is yet to be developed. Proportionally, Albert Nile still remain a multispecies fishery with over 20 fish species harvested commercially. Interestingly, the Albert Nile fishery still remains primitive with simple crafts and gears (mainly dugout canoes, traps, and gillnets). This could suggest that the more developed the system becomes the higher the level of transformation in its fisheries leading to simplification, characterized by reduction in multispecies nature and dominance of few species. Illegal gears especially undersized gillnet of mesh size less than 4 inches were the most dominant in the Lake Albert and Albert Nile fisheries. They captured large quantities of immature fish particularly when used to target Nile perch, Bagrus, Nile tilapia, and large Barbus spp. Their impact when used to target the smaller species (Ragoogi, Angara & Ngasia) is yet to be evaluated. A specific study to analyze selectivity and impacts of these nets is a recommended. However, the dominance of 1.5” mesh sizes especially on Albert Nile to target Angara, Ngassia and Barbus, is definitely destructive to their fisheries and should be checked forthwith. In addition, there is an emerging fishing method locally referred to as “Salsio or Luzira” whereby fishers stay on the lake from 3 days up to 2 weeks without returning to the landing site. They carry with them food and salt for processing the catches on the lake, and in the case of Albert Nile on make shift shelters on islands and in the game park. They normally use gillnets of 3-3½ inch mesh size and caught mainly Nile perch & Bagrus (Pethi & Munama). On return they land several tons of fish. Most of these Catches are not captured in the estimates presented in our analyses since we target daily fishing boats. The possible impacts of this fishing method should be studied and appropriate action recommended.

Fisheries Department Annual Report 1968

The year 1968 was yet another year of great success in the exploitation of the fishery resources. The total catch landed was estimated at 108,400 metric tons, worth approximately 77.2 million shillings at the lake shore, and about 220 million shillings in the retail market. This compared favorably with the 1967 catch of 97,000 metric tons, worth approximately 62 million shi11ings on the lake shore and 140 million shillings in the retail market. The 1968 catch exceeded the 1967 catch by 11,400 tons, and also exceeded the expected catch of 105,600 tons in 1971 by 2,800 tons. Most of the fish was consumed within Uganda, where shown a further increase and was estimated at 13 kg. Per head of population.

Fisheries Department Annual Report 1969

During the year 1969, the fishing industry maintained a rate of increase that had been witnessed in the three previous years. The total catch landed was estimated at 125300 metric tons, valued at shs 130,500,000/-at the lakeside,and about shs 260,000,000/-in the retail market. This was an increase of 16,900 metric tons over the 1968 figure. The largest increases again came from the Lake Kyoga area, where the Nile Perch and the introduced Tilapia species are still expanding. Large numbers of fishermen from other regions (i.e. from Lake Victoria) moved to Lake Kyoga where catches were high and remunerative. This intensified fishing on this lake, resulting in the high figure of catches recorded. As in the previous year, there was a marked increase in the use of large-mesh gill-nets for catching Nile Perch and Tilapia. Individual Tilapia nilotica of up to 5 kg were quite common, and Nile Perch weighing over 50 kg were also regularly taken. The marketing and distribution side of the industry was as active as ever: 87 people took out specific licences, and 640 fishmongers were licensed by different urban authorities. Elsewhere in the Districts, 7,950 fishmongers were licensed. Host of the fish landed was consumed within Uganda and exports accounted for dnly a very small fraction of the market, mainly composed of frozen fiilets to Kenyai and salted fish to the Republic of the Congo. Kampala market was the most important one, serving also as a central market from where fishmongers bought fish for distribution to rural areas.