To define which records of fish farm management practices must be collected regularly so to serve as basis for economic analysis and investment appraisals.
The reason to create a business is to market a product at a price satisfactory for the buyer and the seller. In the field of aquaculture, the basic prices are already set by the fishing industry, so the problem is to develop a technology (engineering and management) which can produce the same quality product at a better price.
Before starting any business, the investors study the demand of the market, the distribution and the prices at different steps of the commercial chain. The shrimp market is characterized by a strong world demand for a product of quality (individual shrimp bigger than 18 g) providing that it can be supplied regularly. Aquaculture fulfils these two conditions better than fishing.
The Kenya national market used to absorb 400 t of shrimps some years ago. In 1982, the catch had only been 312 t; so there is room for at least 100 t of cultivated shrimp, and probably much more as the tourism industry has significantly increased in the meantime.
However, on a national level, the shrimp market and the commercialization chain requires some attention. Prices of 250 K.sh. per kg have been noticed in the retail market for jumbo shrimp in Nairobi; those shrimps are bought at an official price of 27 K.sh. in Shimoni or 47 K.Sh. in Malindi. The cooperatives buy the product from the fishermen and resell them to wholesalers who process it. But for jumbo size shrimp the processing is limited to cleaning, grading and packing whose cost is estimated at less than US$ 1 per kg in other countries.
Aquacultured shrimp may receive a better price because it is supplied on a regular basis, but the attention of the aquaculturist must be drawn on to the fact that the final price of his shrimps will be known only after grading and processing has taken place. This means that he has already lost control of the harvest and some arguments are to be expected between the wholesaler who will offer to pay for one category of shrimps and the fish farmer who will claim for a better category. This is why medium size operators will often try to process the shrimps themselves.
For a potential investor the role of the fisheries cooperatives have to be clarified. Will he have to sell his harvest through them at any official price? Will he be allowed to hold a commercial licence, if necessasry, to sell or export his products directly? The consultant had no time to find the exact legislation concerning that point, but it may be noted that Mexico has a law that “sea water fish and crustaceans” must be sold through fishermens cooperatives. This law is considered to be one of the limiting factors inhibiting the development of marine aquaculture there: U.S. investors fly to Ecuador to participate in shrimp farms when Mexico is known to have very good sites for shrimp aquaculture and is closer.
The status of aquaculture, of aquaculture products and of the aquaculturist need to be clarified. Anyway, the project being a parastal organization, it seems a delicate matter to want to sell shrimps at a different price from that which the Fisheries Department recommends officially to the fishermen.
Up to now, in the consultant's opinion for many reasons most of the economic figures given by the project are underevaluated. One is that the cost of the staff and of the administration are rarely taken into account, a second is that the amortisation rate is reduced, whilst a private will on the contrary augment it as much as possible. The the difficulties in building the ponds have been systematically underestimated; a typical result of such an attitude has been to build 90% of the perimeter dike but not to be able to finish it because of a lack of equipment and other reasons.
In the salt industry, for an investment per hectare similar to that in a shrimp farm, one hectare of land can produce 100 t of salt per year having a value of 67 000 K.sh. with relatively little work, a limited labour force and little risk. It can be noted that this income corresponds to what can be considered as the lowest figure for one hectare of shrimp pond, for large size ponds in an already clean area; for a semi-industrial shrimp farm a figure twice this magnitude would be closer to reality.
To make the same returns on one hectare, a shrimp pond would have to produce, per year, 825 kg of jumbo shrimp (30 g category) to be sold at 82.5 K.sh per kg (US$ 5.5) ex pond (K.sh. 68 063) or 2 600 kg of P. indicus (8–10 g) to be sold at 26 K.sh. per kg (US$ 1.75) ex pond (K.sh. 67 600).
On the basis of 2.5 harvests per year (to take into account a better and larger preparation of the lablab) this means that a production is needed of 330 kg of P. monodon or 1040 kg of P. indicus per ha/per harvest. If the first figure (330 kg/ha/harvest) is attainable without artificial feeding - 1.1 shrimp per m2 -, the second is not.
In both cases, to enable such a production, the operation would require a pumping station and a reliable technology, which means a competent farm manager. Once these preliminaries are fulfilled, harvests of 600 to 700 kg of P. monodon per crop (with some additional artificial feeding, even of limited quality could be obtained.
A form gathering the economical implications of each farming operation from one harvest to the next one has been prepared. However, it must be stated that a normal accounting system will provide all the data necessary to analyse the economics of the culture. For investment a feasibility study is required for each case and it must take in account the type of technology to be developed. Part of the problems met in Ngomeni has been the lack of definition of a real technology at the beginning of the project.
Another difficulty is that in a parastatal project, the salaries are fixed without taking into account the quality and the quantity of work effectively performed. Aquaculture implies weekend and night overtime work that is difficult to pay through normal official salary procedures. It is then not possible to stimulate the workers by any bonus or incentives. From that point of view a private unit would be free to select the best workers by increasing their salaries and then to carry out the same work with only 30 to 50% of the labour force required in a government unit.
Presently private investors have not been attracted by the work done in Ngomeni; they know that shrimp farming is something that is moving on in the world but they are expecting better information, mainly technical, from the aquafarm.
It is difficult to imagine the development of artisanal-scale-shrimp aquaculture for four different reasons: the limited land available, the level of investment, the level of technology required, and the existence of poaching. Because of the competition from salt operations it appears that the only viable shrimp farming operation in Kenya, will be the aquaculture of P. monodon in modern aquafarm equipped with a pumping station.
