Several physical features influence the economics of fishponds. All are important, but only a few have been analyzed to determine their impact. Among those physical features are:
- Productivity in fishponds depends on the prevailing weather and climate in the area. In addition, the growing of long-term crops, such as “sugpo” are not recommended if the culture period will be hampered by unfavorable weather conditions.
- Soils are very important in the economics of fishponds production. Sandy clay soils used for dike construction is preferred for its compactness. It also provides a better situation in fertility management. Soil fertility may be depleted under intensive fish culture so fertilizer is added to increase production. Fertile soils are especially important during the first few years of fishpond production. Soil types which have long-term effects are those which have high acid characteristics. Acids are leached into the fishponds from the dikes; lime may be a solution. Potential acid sulfate soil is a continuing problem when it is used for dike construction.
- The range of ground elevations suitable for construction of fishponds is discussed in the Engineering section of this manual. Higher elevations require a very expensive process to make them suitable for fishpond purposes especially when the source of water can only be obtained from tidal flows. Pumping water by mechanical means is also expensive.
- Leveling costs will vary according to the topography of the area. Levelled areas reduce production costs during pond preparation. Leveling facilitates growth of fish food where lab-lab is grown.
- The density of plant cover is directly related to the costs of clearing an area for fishpond purposes. Larger trees increase costs of clearing especially when using mechanical methods.
- During floods, fish stock may escape which results in losses. Increasing the height of the dikes to protect the area will add to the cost of construction.
- A readily accessible area will lower costs and increase profit.
- The size of the fishponds is intimately connected with economics. Larger areas require more funds to develop and to maintain. Total receipts, expenses and net income per farm generally increase with farm size. However, when measured on a per hectare basis, total receipts and net income drop on areas larger than 10 hectares.2
Establishing a fishpond requires various materials for the construction of gates, buildings, equipment and tools which include catching nets, screens, banca, flat boat or bamboo raft, bolo, digger, shovel and other related items. Other materials needed include lumber, cement, steel bar, galvanized iron, nails, nets, gravel and sand, bamboo, tying materials and others. The major source of these materials are big towns and cities, however, it will be economical if some substitutions are made with available local materials like lumber, bamboo, nipa, sand, gravel and others.
Production supplies like seed stock, fertilizer, chemicals and feeds, can be obtained locally. Where available, “bangus” and “sugpo” fry can be gathered within areas nearby. Fertilizers and chemicals are available at distribution centers in most towns. Rice bran is abundant in rural areas when supplemental feeding is necessary.
Brackishwater fishponds are one of the most important sources of fish consumed in the Philippines. With the introduction of technological advances, high production has been achieved, however, marketing of the output may well become a problem to producers. Information on various marketing practices have been reported from the results of studies conducted by some government agencies. These are important guidelines in improving the marketing system for fishpond fish in the country.
- Producers sell “bangus” either picked-up at the farm by the buyer or delivered to the buyer. Generally, picked-up sales exceed delivered sales because buyers are willing to buy direct from the fishfarmers. Producers should be able to determine which method of sale will help increase their income.
- Like any other fish, “bangus” is regulated by closed bidding (usually whisper selling) wherein the highest bidder sets the price. The fluctuations in the supply level explains in some degree why the market price of fish is almost always quoted by the highest bidder. However, in times where the supply is scarce, fishpond operators are in a position to command the price.
2 Socio-economic Survey of the Aquaculture Industry in the Philippines, Research Paper Series No. 8.
- Sales of fish are carried out either on cash-and-carry basis, cash-on-delivery, consignment or credit. Consignment basis is very common when producers use the services of brokers. For other types of buyers, cash basis is the most common practice followed by cash-and-carry, and cash-on-delivery basis in that order.
- The four major types of middlemen engaged in the marketing of fishpond products (particularly “bangus”) are brokers, wholesalers, wholesalers-retailers and retailers. Studies show that the flow of fish from producers to consumers is characterized predominantly by the activities of fish brokers who handle more than half of the fish sold by fishpond operators.
In a study of 98 fishpond operators and 122 bangus dealers, Creencia, et. al.3 reported that brokers handled 83% of the total sales of bangus (Fig. 2). Direct buyers from producers, like wholesalers, retailers and wholesalers-retailers handle 33%, 4% and 1%, respectively. For the remaining bulk (62%) of the harvest producers use the services of brokers. In addition, wholesalers also pass nearly two-thirds of their net volume to brokers which gives a total of 83% passing via brokers. There is trading between brokers and wholesalers but the net flow is to brokers. Brokers channel 7% of the total volume to other brokers until the products are distributed to retailers (75%) wholesalers-retailers (8%) and consumer (1%).
In another study of 100 fishfarms and 114 bangus dealers, Guerrero and Darrah4 reported separate observations in three geographic areas of the country (Luzon, Visayas, Mindanao).
Producers in Luzon use brokers as the major outlet for “bangus”. Of the total volume sold, 75% goes to brokers, 18% to wholesalers, 6% to retailers, 1% to wholesalers-retailers and a minimal amount goes directly to consumers (Fig. 3). There is trading both ways between brokers and wholesalers, brokers use other brokers and wholesalers sell to other wholesalers but finally the whole quantity goes to retailers, exporters and wholesalers-retailers. Wholesalers-retailers sell to retailers and consumers. Retailers also sell to other retailers and ultimately to consumers.
The product flow in the Visayas shows that producers sell 63% to brokers and 23% to wholesalers. Smaller proportions go to a cooperative (fishermen), a wholesaler-retailer, retailers and consumers (Fig. 4). The volume handled by the cooperative is channeled to brokers. Brokers transfer “bangus” to other brokers and brokers sell to wholesalers and vice-versa. The ultimate outlet used by brokers are retailers. Wholesalers use brokers and retailers as outlets. Wholesalers-retailers sell mostly to retailers with a minimal amount to consumers. There is trading between retailers but finally the product is sold to consumers.
*Less than 0.5 percent.
**Net flow: meaning there was trade both ways.
Fig. 2. Marketing Channels for Bangus, Philippines, 1973
*Less than 0.5 percent.
**Net flow, meaning there was trade both ways.
Fig. 3. Marketing Channels for Bangus, Luzon, Philippines, 1974
*Less than 0.5 percent.
**Net flow, meaning there was trade both ways.
Fig. 4. Marketing Channels for Bangus, Visayas, Philippines, 1974
In Mindanao, producers sell almost entirely to brokers (50%) and wholesalers (45%). Only a small amount goes to wholesalers-retailers, retailers and consumers (Fig. 5). The brokers sell only to retailers while wholesalers sell to brokers, other wholesalers and retailers. Wholesalers-retailers sell to retailers and consumers and retailers sell only to consumers.
In a related survey on fishpond operations and marketing practices conducted in Quezon Province, dela Cruz and Lizarondo5 observed that majority (54%) of the 95 respondents surveyed engaged the services of brokers in the sale of fishpond products, 13% identified wholesalers as their regular outlet, 4% catered to wholesalers-retailers while 2% sell directly to retailers.
- The major flow of “bangus” from all areas goes to Manila. In Luzon, minor flows are from Pangasinan area to Northern Luzon, Bicol and Palawan to Manila and Laguna Lake to Pangasinan (Fig.6 ). In Visayas, minor flows are largely to other islands in the area and to Mindanao (Cagayan de Oro and Davao). Minor flows in Mindanao are largely to Cagayan de Oro.
- A perennial problem of fishpond operators is how to sell their produce at the best possible price. There seems to be a need to organize new, or activate dormant, fishermen's cooperatives so that combined marketing will bring favorable returns. In addition, cooperatives will provide a supply of production inputs at reasonable price as well as facilities and extension services to improve production.
There is no reason to recommend a production system which is beyond the capabilities of the fishfarm manager. The solution is to reduce the level of the recommended system or to improve the abilities of the manager. If the manager's ability can be raised through normal channels, such as extension, then this is the preferred course. However, the system must be tailored to fit the abilities of the producer.
Frequently, the priorities of the fishpond owner will override all other considerations. Any program not suiting such priorities will be largely ignored. A pond owner should be expected to want to receive the largest return for the resources alloted, i.e., maximum resource allocation. However, owners have varied goals. They may wish for large returns with minimum resource inputs. On the other hand, some owners are not concerned with efficiency, but wish to inflate their egos by producing very high yields no matter how high the cost of production. The role of Economics Extension is to point out the economic factors that can improve the profit margin of the fishfarm. We may have to subtilely change the owner's priorities in order to have him follow the recommendations.
*Less than 0.5 percent.
Fig. 5. Marketing Channels for Bangus, Mindanao, Philippines, 1975.
Fig. 6. Geographical Flow of Bangus, 1974
