So You Want To Get Into Aquaculture?
by Don Webster, Eastern Shore Area Agent
Every week extension agents and specialists receive inquiries from people who want to start an aquaculture business. Most, we know from experience, will never get to the point where they actually start an enterprise. Because of lack of capital, lack of experience, or the developing realization that this business takes more than just a notion, many fall by the wayside.
For those who do stick it out, there is the knowledge that they are getting into one of the fastest growing areas of American agriculture. It's an industry that has seen a great deal of growth during the past two decades and seems to have a bright future. How do you go about getting into business and where are some of the areas where you will face challenges? Let's take a look at some of them:
This is one of the first things you will need to do and it will, in many cases, also decide on the production system that you will use. Fish such as tilapia require warm water. If you decide to raise them, you will have to use an enclosed reuse system to retain heat in the cold months. On the other hand, if you're raising trout, you will need cold water. That means you won't be trying to raise them in ponds on the Eastern Shore where summer water temperatures can go over 90 degrees F. If you are going to pursue shellfish aquaculture, you will need to have a salinity profile in the areas you are considering. Many areas of Maryland are too fresh to be able to raise species like Mercenaria (hard shell) clams. In short, you need to match the biological needs of the animal to the growing area and system.
Location can be critical to success in aquaculture. Not only must the biology of the animal be taken into account, but available utilities, transportation system, and proximity to markets. Aquaculture operations can use large amounts of electricity to drive pumps, aerators, and other equipment to keep fish alive and energy is often expensive. Investigate off peak power rates with your utility company since this may save you a great deal. Also, three phase power is cheaper than using single phase but it may not be available in many rural areas.
Roads and airports need to be considered since you're going to be moving fish and/or shellfish and need to get to market rapidly. Are there truck terminals where you can ship your product with companies that handle fresh product? How reliable are the airlines in getting fresh product to market? Are there other producers nearby to pool loads and feed shipments with?
Most importantly, what is the price of the real estate that you're going to need? How much water is available in surface or underground sources and what is the quality of that water? Spending time investigating these things at the beginning will save you from expensive mistakes that could jeopardize your business before you get your first crop to market.
Financing an aquaculture business is usually hard. Banks have little experience with them in many areas. Those that would freely make a loan for a poultry operation will be reluctant to make one for aquaculture because they have not done so before and may have heard of one or more that never made it to financial success. Government loan and/or guarantee programs can sometimes be used to help minimize the banks exposure in a loan.
Bear in mind that few aquaculture ventures develop a cash flow in a short time. Many take several years in order to develop one. In that respect, financing an aquaculture business can be more like starting an orchard rather than grain farming. You need to allow for that in your financial planning.
In all instances, spending the time to put together a professional looking business plan will assist you. It shows the banker that you have taken time to do your homework in gathering and analyzing the economic figures and a good business plan will be used to guide your business as it develops.
This can be a frustrating road, depending upon what you want to do. If you are developing ponds on existing farmland, you may not have many problems. If, on the other hand, you want to engage in open water aquaculture in the Chesapeake Bay using one of the experimental permits, you may be in for the bureaucratic ride of your life. Find out beforehand what permits you will need, including such things as zoning changes. Doing so will keep you from being surprised at some point down the road. Many states have aquaculture coordinators who can advise you on the permits you will need for the operation you're proposing.
You need to have an idea of where you are going to sell your product and who your competition is going to be. Marketing is the strategic positioning of your product and should not be confused with sales. If you are going to be raising 50 or 100 acres of fish that will come to size at a particular time, your market strategy will be far different than someone who has a few cages of fish in a pond and can afford to harvest a few hundred pounds at a time.
Aquaculture is a fascinating business and offers potential for those who have the drive to seek out opportunities, plan their business strategy, and pursue their goals. It's not easy but it can be done. Doing the background work necessary to make sound business decisions is critical to success. We all probably heard it enough during our school years but, if you want to get into the business, it is still necessary to, "Do your homework"!
If you would like more on this subject, please call or write any of the Area Agents listed in the newsletter or send a request by e-mail to firstname.lastname@example.org. We will be glad to send you copies of the following fact sheets:
High Energy Diets For Fish
by Rich Bohn, Southern Maryland Area Agent
Aquaculture is a risky business and often dependent on fair weather as well. Farming salmon and trout in sea cages and raceways may seem well controlled, but storms and floods often mean lost fish and equipment. Raising fish quickly can reduce this risk by shortening exposure time. Both systems are also under scrutiny because of excess nutrients entering the environment, but recent advances in altering fish diets may provide a partial solution to both problems.
As our understanding of energy use and fish metabolism has increased, high energy diets have been developed to speed growth rates. Higher levels of proteins and fats and lower amounts of carbohydrates can increase growth rates when the diet is fed properly. By using contents with higher digestibility, nitrogen and phosphate wastes also appear to decrease; reducing nutrient impacts leaving fish farms.
Much of the research began with salmon raised in ocean pens. Diets using around 40 percent protein and up to 36 percent fat were produced using extruders, which can maintain fat content in diets better than other types of pellet makers. Fish were fed the diet to their maximum capacity daily, increasing the growth rate substantially. The food conversion ratio (feed to flesh) was similar to standard diets used by the industry, but fish reached market size in less time.
Diets developed next for trout farms use 45 percent protein and 28 percent fat, and have shown similar success. Differences in diets between species reflect the optimum ratio of digestible protein to total digestible energy needed by different species of fish. Incorrect ratios can cause excessive fat deposits which are lost during processing or impact flesh quality.
While additional research is required before applying the approach to other fish farmed in our region, the results have shown promise for reducing growing times and the environmental impact of nutrient wastes. Finishing diets may also be needed in some instances before marketing. Salmon used for smoking, a process that requires leaner fish fillets, are often placed on a lower fat and protein diet for the final four to eight weeks before processing.
Finishing diets also may be changed to improve fillet quality or even extend shelf life after processing. However, the research always demonstrates the importance of proper feeding practices, in addition to appropriate diets, in reducing growing times as well as feed costs.
Choptank River Oyster Recovery Area Activities Begin
by Don Meritt, Shellfish Aquaculture Specialist
The summer of 1995 began a new era in oyster repletion as the oyster hatchery at the University of Maryland Horn Point Laboratory (HPL) geared up to produce seed oysters for use in the Choptank River oyster recovery area. As the first major thrust of the historic Oyster Roundtable Action Plan for Oyster Recovery in Maryland, the Choptank River received some two and a half million oyster seed.
Seed oysters were produced from local broodstock spawned in the hatchery. The larvae were then set using a newly refurbished production setting system at Horn Point. The newly set oyster spat were then transported to nursery areas in the upper Choptank where they remained for a few weeks and allowed to grow. Once the spat had reached planting size (1/2 to 3/4 inch) they were deployed on specially built beds for final growout. The beds were constructed during 1994 by the Maryland Department of Natural Resources using dredged shell mined from the upper Chesapeake Bay. A ten acre shell plot was divided into two segments, one which received hatchery seed this summer and a second plot which is due to receive a similar amount of seed during the summer of 1996.
Oyster seed produced in the HPL hatchery were monitored for disease during the hatchery phase and while they were deployed in the nursery areas. Monitoring will continue as part of a scientific evaluation that includes researchers from other University of Maryland departments and the Cooperative Oxford Laboratory. Data collected will help with understanding oyster spat growth, survival, and the dynamics of disease pressure that has so severely limited oyster production in the Chesapeake Bay in recent years.
The test plots will also be used to document the overall changes in the area and should contribute to a better understanding of the ecological value of oysters to the Bay's general health. Oysters are the foundation of what were major reef structures scattered throughout the Bay and its tributaries. Many of these reefs have undergone major changes as oyster populations have severely declined. Other organisms which depend on this reef structure for food, shelter, or substrate have also undergone drastic population changes. This study is designed to better quantify the importance of oysters to these associated organisms.
The work in the upper Choptank this summer was funded by the Department of Commerce NOAA, Maryland Department of Natural Resources, and the Maryland Oyster Recovery Partnership. This cooperative effort was accomplished by coordinating the efforts of researchers, watermen, and management agency personnel, and by utilizing schoolchildren brought to the region by the Living Classrooms Foundation. Middle school students from the Baltimore area were instrumental in providing much of the labor involved in moving large volumes of material from the hatchery to the nursery areas and from the nursery areas to the planting grounds. In this way, the project got a much needed labor force and the students got a first hand demonstration of what is involved in oyster repletion and a great hands on example of the Bay's ecology.
Water Reuse Short Course: Some Lessons From School
by Steve Bogash, Enterprise Consultant
From July 10 thru July 15, 1995, Dr. Michael Timmons of Cornell University led a group of producers and extension representatives on an excursion into the world of recirculation aquaculture systems. This "Short Course on Water Reuse Systems" was supported by the Regional Extension Project of the Northeastern Regional Aquaculture Center (NRAC), one of five such centers funded by the USDA. The project reimbursed travel and tuition for extension agents and specialists within the region to attend. The knowledge gained will be put to use in their respective states for the benefit of the aquaculture industry.
Rich Bohn (Southern Maryland Area Agent) and I attended the program representing the University of Maryland. While it seems that the engineering aspects of recirculation have come a long way in recent years, an operator must still be part engineer, part grower, and part magician to keep a system operating well. Fish kills and other lesser but still equally serious problems that affect the bottom financial line are still common in water reuse systems. Still, the promise of producing economically competitive fish in reduced water demand systems continues to attract attention and research. The design of recirculation aquaculture systems and their subsequent management continues to evolve and develop.
The following are some of the rules regarding the systems which we learned at the course:
Other system design rules:
Of great interest in recirculation aquaculture is the development of microbead biofilters. These operate in the same fashion as the more standard biofilters, that is they provide a large surface area for the nitrogen-cycling bacteria to react with the water undergoing treatment. One large difference is the greatly decreased cost per square foot of reactive area and the much smaller floor space required for support. The beads in question are simply polystyrene micro beads, commonly used in casting Styrofoam objects. Dr. Timmons and his staff have become adept at designing and building components from many common materials.
Recirculation aquaculture systems show promise for locations that either have limits on the size of a system or the quantity of water available. As technology and management skills improve, it appears likely that we'll see more enterprises develop that concentrate on water reuse technology.
Seafood Technology Specialist Joins SGEP Staff
Tom Rippen has joined the Maryland Sea Grant Extension Program staff as a Seafood Technology Specialist. He will be based at the University of Maryland Eastern Shore in Princess Anne and will work primarily with the seafood processing industry.
Tom earned degrees in fisheries and food science from Michigan State and has spent the past fourteen years as a Cooperative Extension Service specialist at Virginia Tech and director of the Virginia Seafood Research and Extension Center in Hampton VA. He has published articles on seafood pasteurization and sea scallop processing, and has authored two industry reference manuals on blue crab processing. He gained a national reputation in seafood technology research and outreach and has been involved in many regional efforts including "Aquaculture In The Mid Atlantic", where he helped develop many of the programs aimed at seafood processing and quality. He also was a principal educator in "Fish Tech", which trained many of this region's home economists in seafood quality, preparation, and nutrition.
The faculty of the Sea Grant Extension Program would like to welcome Tom to Maryland and we look forward to supporting his program activities. He will be a contributor to the Maryland Aquafarmer, including information on the important area of seafood technology which impacts farm raised, as well as wild produced, species.
Food Safety Regulations Affect Aquaculture
by Tom Rippen, Seafood Technology Specialist
U.S. Food and Drug Administration (USFDA)
The U.S. FDA regulates the production and marketing of sea foods entering (or likely to enter) interstate commerce under the Federal Food, Drug, and Cosmetic Act. As with other sea foods, the safety and wholesomeness of aquaculture products fall within FDA's purview. The agency has announced its intentions to more aggressively monitor the aquaculture industry in the future, including proper use of approved therapeutics and prevention of product contamination with agricultural chemicals or pathogenic microorganisms. Growers can expect to bear increased responsibility for documenting compliance with the Act. Issues which may not at first appear to be of a product safety nature may, in fact, be very significant. For example, run-off from surrounding farmland into grow-out ponds may contaminate products with disease-causing bacteria or chemical contaminants.
Most business managers are familiar with quality assurance strategies such as Total Quality Management (TQM) and ISO 9000. Whereas ISO 9000 is the international standard system for manufacturing industries, the Hazard Analysis Critical Control Point (HACCP) system is the international standard for the food industry. Numerous national and international organizations have endorsed HACCP as the most effective and rational approach for achieving a safe food supply.
Under HACCP, processors identify potential food safety hazards and implement a system of controls and checks which reduces the probability of unsafe products reaching the consumer. HACCP development involves a series of steps beginning with a thorough analysis of potential hazards (Hazard Analysis) at each processing operation, given the expected end-use of the product. Steps which must be controlled to assure safety or other requirement are designated Critical Control Points (CCPs). At these points (and only there) Critical Limits are established. The appropriate parameters are Monitored to assure that these limits (such as product storage temperatures) are not exceeded. Records are kept as documentation that the CCPs are under control. When a critical limit is exceeded, a Corrective Action is taken and documented. The final step is periodic Verification that the HACCP system is working.
Steps for Implementing the Seven Principles of HACCP
Most seafood processors are currently excluded from the prescriptive process controls and record-keeping requirements of the canned food industry, provided processors show evidence, satisfactory to the FDA, that they produce safe products processed under sanitary conditions. However, this situation is expected to change in 1996 when FDA publishes regulations for a national mandatory HACCP-based inspection program for the seafood industry.
In January 1994 FDA published proposed rulemaking (Federal Register vol. 59, no. 19) detailing the responsibilities of industry under mandatory HACCP inspection. They also released guidelines and model HACCP plans to assist the seafood industry in developing HACCP systems acceptable to the agency. Much of the proposal is very specific, including such areas as plant clean-up and employee practices previously covered only under the umbrella Good Manufacturing Practices (GMPs). FDA would have access to HACCP records during inspections to determine if problems occurred prior to their visit and how those problems were resolved. Even if no other problems are identified, an inadequate HACCP plan will likely constitute a violation of the Food, Drug and Cosmetic Act.
Comments solicited by the Federal Register announcement are under review and final rules should be published by early 1996. Implementation is not expected until mid- to late 1996 and an additional one year phase in period is likely. The actual requirements under HACCP vary according to the expectations of the responsible regulatory agency or company. For example, corrective actions and verification procedures are usually predetermined during HACCP development but, in their proposed rules, FDA would not require them in the written plan.
Aquaculturists (growers) were excluded from FDA's HACCP proposal. Also excluded were transporters (e.g.. trucking firms), and retail and food service sectors which are inspected by state and local agencies. The proposal would place responsibility for HACCP on processors and importers.
Aquaculturists may question their need to develop an HACCP program given this expected exclusion. However, the issue is quite complex. FDA's position is to conduct HACCP inspections at facilities of the type they currently inspect. For this reason, they include warehouses and wholesale companies in their definition of "processor", even though these firms may not directly handle the product. This policy allows FDA to inspect and intercept non-compliant products at some point in distribution. It seems doubtful, therefore, that FDA will permit the direct sale of aquaculture products to end users without HACCP controls, even when each step (production and harvesting, trucking, retail) appears to be excluded. For example, simply icing or boxing fish is likely to meet the definition of processing for inspection purposes.
Even if FDA does not directly inspect aquaculture facilities, they will require processors who receive aquaculture products to provide documentation that the products they purchase are under HACCP controls. This liability will almost certainly translate to an economic reality for producers: buyers of seafood for processing plants and wholesale distribution companies may soon purchase only from suppliers who operate under HACCP.
Special provisions apply to molluscan shellfish, which come under the National Shellfish Sanitation Program, jointly administered by the FDA and designated state agencies. This program will become more HACCP-like as it too, falls under the proposed HACCP inspection system.
Safety and Management Implications of HACCP
The extent of regulatory scrutiny and the complexity of HACCP plans is determined largely by the type of products produced. Pathogenic bacteria and viruses are generally regarded as the greatest safety hazards in seafood. Since adequate heating kills these microorganisms, ready-to-eat products and raw molluscan shellfish attract the most concern. They are not normally cooked or fully reheated at time of consumption.
Any product which is deemed to be high risk, especially when it involves numerous, complex processing steps is likely to require extensive monitoring and Record keeping. Complexity results from the number of potentially hazardous operations, or their interaction, which may be difficult to control. Hazards are heightened, for example, by steps involving the combination of raw ingredients from various sources or reliance on multiple processing parameters to assure the destruction of pathogens. Most processors will require assistance with assessing the food safety significance of value-added processing procedures, and with the identification of appropriate HACCP controls.
Hazards of Priority to Aquaculture
In the "Fish and Fishery Products Hazards and Controls Guide" FDA identifies three safety categories (chemical contamination, food and color additives, and aquaculture drugs) and three non-safety categories (filth, decomposition and parasites) which should be controlled in aquaculture. Implicit in their comments is the need to implement HACCP at the grow-out site to control hazards, including the contamination of products with agricultural chemicals.
The agency identifies several pathogenic bacteria of concern in seafood including a few which are especially significant for aquaculturists: Clostridium botulinum, Listeria monocytogenes, Salmonella, and, Staphylococcus aureus. The first three microorganisms are associated with ponds and other outdoor facilities. C. botulinum is a soil organism which, under certain conditions, can produce the toxin responsible for botulism poisoning. Listeria and Salmonella are often associated with the intestinal tracts of livestock and wildlife, including birds which may frequent ponds. Individuals may also shed these bacteria. Listeria is readily tracked into packing facilities on feet and adapts especially well to cool, moist areas such as storage coolers. Staph. aureus is most commonly transferred to food by people during handling. Other pathogens also should be considered during hazard analysis, and new organisms will emerge in the future.
As previously stated, FDA expects to hold processors responsible for products produced by aquaculture producers. FDA anticipates that processors will periodically visit production sites and audit procedures. They recommend that, before product is accepted, field agents review the grower's animal drug and medicated feed usage records and any veterinary prescriptions. FDA also expects that products will be periodically tested for drug residues.
An aquaculture setting offers the potential for tight controls. However, aquaculture products are not inherently safer or of higher quality than their wild harvest counterparts. Only through effectively managed safety and quality assurance programs is this potential realized. For liability reasons, the aquaculture industry is urged to be extremely cautious when promoting food safety as a marketing advantage.
For more information, contact the Maryland Sea Grant Extension Program (Tom Rippen at 410-651-6636) or the National Fisheries Institute in Arlington, Virginia (703-524-8880).
Getting Good Numbers
by Douglas Lipton, Marine Resource Economic Specialist
Aquaculturists and others interested in the fish business would do well to get hold of a copy of the National Marine Fisheries Service annual fishery statistic report entitled "Fisheries of the United States, 1994 (NMFS, Current Fishery Statistics No. 9400, August, 1995). The document is available from the U.S. Government Printing Office, Washington, DC 20402. The phone number is 202-512-1800.
Examination of the information available in Fisheries of the United States reveals much about the trends and status of the fishing industry and its implications for the growth and development of aquaculture. For example, one can find that total U.S. fish landings were down ever so slightly (less than 0.1%) from the record 1993 landings. However, the value fishermen received for their catch was up 11 percent over 1993, due to higher dockside prices.
The gap between imports and exports of edible seafood products increased to $3.5 billion in 1994, following several years of decrease. The increase in the value of exports was more than offset by record imports. Shrimp continues to dominate fishery imports, accounting for over 40 percent of the value of imports. Salmon dominates the export market with over 22 percent of the export value.
Seafood consumption increased to 15.2 pounds per person in the United States in 1994, 0.2 pounds higher than in 1993. This is still a full pound per person lower than the peak consumption in 1987, but it is still the highest since 1989. The 0.2 pound increase was accounted for by fresh and frozen product, while canned and cured consumption remained level. Of the fresh and frozen product, fillets and steaks increased 0.2 pounds, and the ubiquitous shrimp increased 0.1 pound to a record 2.6 pounds per person. These increases were slightly offset by a 0.1 pound per person decline in fish sticks and portions consumption.
Aquaculture production and value information is not available in Fisheries of the United States, but it contains a wealth of information about the marketplace in which aquaculture competes.
Grass Carp: A Biological And Ecological Overview
by Reginal M. Harrell, Aquaculture
Maryland Sea Grant Extension Program
Coordinator and Marine Economics Specialist
Coastal Communities Specialist
Environmental Education Specialist
Andrew M. Lazur|
Finfish Aquaculture Specialist
(410) 221-8474, 8496
Seafood Nutrition Specialist
Shellfish Aquaculture Specialist
Seafood Technology Specialist
Water Quality Specialist
(410) 827-8056 ext. 127
The MARYLAND AQUAFARMER Newsletter is produced quarterly each year by the Cooperative Extension Service, University of Maryland, College Park with support from the Maryland Sea Grant College Program and is issued as a public service for the aquaculture industry. Annual subscriptions are free of charge.
Last modified July 05, 2006
Issued in furtherance of Cooperative Extension work, acts of May 8 and June 30, 1914, in cooperation with the U.S. Department of Agriculture, University of Maryland, College Park, and local governments. Thomas A. Fretz, Director of Cooperative Extension Service, University of Maryland, College Park.
The Maryland Sea Grant Extension Program is a joint effort of the Cooperative Extension Service and the Maryland Sea Grant College, supported in part by NOAA Office of Sea Grant, Department of Commerce.
The University of Maryland is equal opportunity. The University's policies, programs, and activities are in conformance with pertinent Federal and State laws and regulations on nondiscrimination regarding race, color, religion, age, national origin, sex, and disability. Inquiries regarding compliance with Title VI of the Civil Rights Act of 1964, as amended; Title IX of the Educational Amendments; Section 504 of the Rehabilitation Act of 1973; and the Americans With Disabilities Act of 1990; or related legal requirements should be addressed to the Director of Personnel/Human Relations, Office of the Dean, College of Agriculture and Natural Resources, Symons Hall, College Park, MD, 20742