7. THE GULF OF THAILAND FISHERY

7.1 Background

Prior to the rapid development of trawl fisheries in 1962, annual catch of pelagic species accounted for a major portion of the total marine catch. The proportion of pelagic catch had decreased gradually and hit the lowest percentage (about 9% of the total marine catch) in 1972. However due to the introduction of the luring purse seine there was a substantial increase in annual landings of pelagic species in the Gulf. The share of pelagic catch increased significantly and reached the peak of about 28.5% of the total marine catch in 1977. In 1982 the total Gulf catch of small pelagics (herrings, sardines, anchovies, etc.) was approximately 116 500 t, and out of this total about 90 000 t were sardines.

The most important species were the mackerels (Rastrelliger brachysoma, R. kanagurta) but more recently sardines (Sardinella gibbosa S.fimbriata) and roundscads (Decapterus spp.) have predominated.

Major fishing grounds for pelagic fisheries,except for luring purse-seine fisheries, are located mainly in the coastal waters of the Gulf of Thailand. The luring purse-seine fisheries are operated mainly in waters with the depth of more then 30 m.

The major fishing grounds are shown in Figures 3 and 4.

In the wooden purse seiners, the holds have a capacity of 40–50 t of fish, but are divided into 5-t compartments. The holds are insulated and crushed ice is used. The fish is iced in bulk and with ice meltage the storage system resembles CSW storage. However, the variability of the ratio of fish to ice is very high, giving a wide range in quality.

The catches, between 15 t and 20 t per trip, are lifted from the hold to the deck by scoop and emptied into bamboo baskets, which are unloaded by chute. The fish is then spread out for sorting on the ground and groups of women sort the fish according to species and size. The fish is then weighed in bamboo baskets and sold to merchants in the baskets or after repacking with ice on open trucks in wooden boxes.

7.2 Technological Development

The initial efforts for quality improvement within the FAO/DANIDA project were concentrated upon the unloading and sorting of purse-seine catches. The problems of the current system and its effect on quality and yield are clear. Improvements were attempted by the introduction of an unloading conveyor and mechanical sorting equipment at Pattani. Development, installation, testing and recommendations for implementation were undertaken by the FAO/DANIDA project with some success. However, the benefits of this project have not accrued to the Fishermen's Cooperative in Pattani but to a company in the private sector which is currently using the equipment effectively.

Figure 3 The fishing grounds of Indian mackerel (Rastrelliger kanagurta) in the Gulf of Thailand

Figure 4 The fishing grounds of Sardine (Sardinella spp.) in the Gulf of Thailand

It is now important to examine the possibilities for technological improvement through the whole marketing chain and examine their commercial potential.

7.3 Pre-Feasibility Study

The alternative market outlets for small pelagic species caught in the South of Thailand may be exploited either by increased production of canned fish or by investment in a transportation system to markets such as Bangkok.

The success of both options would depend initially on an improvement in quality to a level higher than that presently available. Efficient conversion of purse seiners from bulk storage to CSW storage would assist this improvement. The installation of unloading conveyors and sorting conveyors in accordance with the FAO/DANIDA project recommendations would also be of advantage.

The cannery option requires an investment in CSW storage on shore, whilst the option for fresh fish marketing in Bangkok depends on an investment in insulated trucks. An investment in CSW storage for the latter is regarded as inappropriate because of the length of the fishing trips and the urgent need to reduce delays in the port area.

This profile presents extremely difficult problems as there is no obvious potential for market expansion of either canned products or fresh sardine distributed over a wider area. In fact the interviews held with personnel in fishery institutions in Thailand suggested that there was consumer resistance to products made from small pelagic species.

The approach in this study has been to propose reasonable price increments for each of the options and to evaluate their consequent financial and economic viability. The risks, even at the outset, are regarded as high, but if assessments of the markets are to be recommended then the options for development must be proven.

7.4 Financial Analysis

The financial analyses indicate that both options, based on the assumptions given for prices and inputs, are financially viable. The financial internal rate of return (FIRR) for the fresh fish option is estimated at 18%, whilst that for the canning option is estimated at 26.9%. These rates of return are more sensitive to changes in revenues than either capital costs or operating costs and a drop of 10% in revenues gives a reduction of FIRR to 6.9% for the fresh fish option and 22.5% for the cannery option. This fall in FIRR to 6.9% for a project designed to deliver fish from southern Thailand to Bangkok emphasizes the high risk.

7.5 Economic Analysis

The economic analysis is based upon the financial data with the following adjustments:

1. prices for capital goods have been adjusted by a factor of 80% to exclude the tax component;

2. no adjustment has been made for labour costs;

3. transfer payments have been eliminated.

The economic internal rates of return (EIRR) are 32.7% and 32.9% for the fresh fish and the cannery options respectively.

7.6 Conclusions

The purpose of a feasibility study is not only to determine whether the project is sufficiently promising from the financial and economic points of view, but also to identify aspects of the project that appear to be uncertain and merit further attention.

This project exhibits a high degree of risk and such investments cannot be recommended at this stage. There is also no case for a vessel study and priority should be given to market development projects. The cannery option shows some promise but there is a need to carry out marketing studies. The project option designed to investigate the delivery of fresh fish to Bangkok appears to be doubtful and perhaps more effort should be put into new product development.

7.7 Brief Description of Analysis Tables for Thailand

Financial Unit = Baht 1 000