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Rising Costs, Falling Demand Hit Catfish Farmers

by the Fish Site Editor
08 September 2009, at 1:00am

VIETNAM - Falling demand and rising costs are forcing thousands of catfish farmers in the Cuu Long (Mekong) Delta to sell their businesses or go bankrupt.

Pham Ngoc Thai has been farming basa and tra catfish for more than seven years in Thoi Lai district of Can Tho City. He says he is selling up after making huge losses over the last two years.

It is estimated that some 12,000 tra and basa farming families, representing 90 per cent of fish farmers in the Mekng delta, have been losing money.

"VND 15,400 is what it costs to breed one kilo of tra and basa fish. However, the highest selling price now is VND 14,500. We expect to lose about VND 550 million (US$30,600) per hectare this year," Mr Thai says.

According to agriculture and rural development authority of the region, the area of tra and basa breeding in the country this year is just 3,690 hectares – 60 per cent less than in 2008.

An expert from a seafood co-operative in Vinh Long province says he expects about 80 per cent of catfish farms to go bankrupt if market conditions do not improve.

Fish feed dearer

To offset the rising cost of fish feed, larger farms have been allowed to buy in bulk at reduced prices. However, they are still struggling to make a profit.

Nguyen Van Khoi, deputy director of the Soc Trang Agriculture and Rural Development Department, says: "Though the large-scale rearing model helps farmers reduce input costs, they are still only able to break even."

Nguyen Van Tai, who owns a two-hectare fish farm in An Giang Province that produces 2,000 tonnes of tra and basa fish annually, says it costs between VND 14,200 to VND 14,800 to produce one kilo of catfish on his farm.

"Depending on fluctuations in the price and market demand, we can make a profit of just VND 400 to VND 600 per kilo. In these difficult times, we can only hope to cover our expenses," he says.

The cost of fish feed makes up 85 per cent of a farm’s expenses. The rising feed price means that for many farmers, their production costs exceed the selling price, according to Khoi.

He said: "Most farmers are feeding their fish with food bought at the market. Therefore, they are at the mercy of the producers who set the price. It is better to feed fish with home-made food to reduce costs."

However, farmers often lack the know-how to make fish food at home. They need to be trained by aquaculture experts to avoid killing their fish through lack of knowledge, he says.

Vu Thi Ly, a farmer in Soc Trang Province, says: "Unsold fish still have to be fed or they get yellow fat, which makes them uneatable." Making matters worse, there is falling demand for catfish.

Pham Thi Mui, who owns a 1.5-hectare fish farm in Binh Thuy District in Can Tho City, says: "Many farmers in my village have switched to breeding fish fries because they consume less than catfish."

Few signed up

According to local aquaculture authorities, just 15 per cent of fish farms in the southern province of Hau Giang have signed contracts with factories to sell their products.

The department says it expects there to be just 52 hectares of fish farms in the province next season. In Kien Giang province, authorities say they expect the fish-farming area to fall by 80 per cent. Le Chi Binh, deputy chairman of An Giang province’s Aquaculture Association, says a tra and basa rearing association should be set up in the Cuu Long Delta provinces.

The association would serve as a place where material suppliers, farmers and consumers can meet to discuss their concerns.

"Regulations on water and food supply, input material prices, quality standards and the environment will be set up to protect farmers’ rights and interests," he says.

"Farmers will be able to reduce advertising and production costs if the association is set up," he adds.

the Fish Site Editor