The Effect of Equity on Cash Flow Risk on Catfish Farms
Carole Engle and Greg O’Neal

Cash flow budgets were developed for catfish farms of 60 acres, 131 acres, 256 acres, 431 acres, and 1,007 acres.  Equity levels were varied from 0% to 100%, in increments of 10%.  Catfish farms had positive cash flow over a wide range of equity levels.  However, the 60-acre farm had cash flow problems at 90% financing.  Each 10% increase in financing resulted in a 4% decrease in the farm’s ability to absorb higher expenses.  At 90% financing, a 4% increase in operating costs resulted in liquidity problems.  Farm size had little effect on cash flow.  Cash flow problems emerged with 27-38% increases in operating expenses or revenue decreases of 16% to 26%.

Preferences of U.S. Households for Catfish and Other Fish
Carole Engle, Ganesh Kumar, and Kwamena Quagrainie

A telephone survey was conducted of customers in several major U.S cities in the core catfish market  (Baton Rouge, Birmingham, Chicago, Dallas, Houston, Jackson (MS), Little Rock, Memphis, New Orleans, Oklahoma City, and San Antonio) to:  1) identify catfish consumer and non-consumer categories; 2) determine characteristics, attitudes, and perceptions of catfish, and 3) determine the potential for increased consumption of catfish.   The survey indicated that cities like San Antonio and Chicago had the greatest potential for market expansion through increased awareness of farm-raised catfish. Birmingham and New Orleans had greater numbers of fish buyers, and offer greater chances for increased catfish sales in the future than cities like Houston , with lower percentages of fish-consuming households.  Catfish product attributes like freshness, availability, expiration date on packages, and the appearance of fillets had the greatest influence on household purchases.  The overall reputation of catfish was positive. Study results indicated potential acceptance of 6-fillet retail packs among households. 

Efficiency Change and Technological Progress in the U.S. Catfish-processing Sector, 1986/05
Aloyce R. Kaliba, Carole R. Engle and Larry Dorman

Productivity growth of the catfish-processing sector in the U.S. was measured over the time period of 1986 through 2005. The analysis evaluated the efficiency with which products are produced by catfish processing plants. The Malmquist index is employed to decompose the total factor productivity into growth associated with technical efficiency change and technological progress. The relationship between Farrell's measure of technical efficiency and the Shepard's distance function provides the theoretical foundation for estimating the Malmquist production index using data envelopment analysis.  The results indicate that, between 1986 and 2005, there was no technical progress or adoption of new techniques with significant impact on catfish processing. Technical efficiency change, which is associated with input use efficiency, varied with type of fish size processed. It decreased from 1985 to 1995 as the industry struggled to establish the most efficient fish size to process. Between 1995 and 2005 the fluctuation continued but at a higher mean. Productivity growth and long-term competitiveness are likely to result from adoption of new processing innovations by the catfish-processing sector. 

The Welfare Effects of Increased Imports in Catfish-producing States in the U.S.
Aloyce R. Kaliba and Carole R. Engle

Catfish is an important component of the foodfish aquaculture industry in the U.S. Farm-raised catfish are produced and processed primarily in Mississippi , Arkansas , Alabama , and Louisiana . The impacts of increased imports are analyzed using a regional computable general equilibrium model that uses Mississippi , Arkansas , Alabama , and Louisiana social accounting matrices as a benchmark dataset. The economic impact of increased imports is captured through an exogenous decrease in 20% of domestically produced catfish, which are also used as an intermediate input by the catfish-processing sector. The results indicated that there was a long-run decrease in equivalent variations and income for all households in the region. There was an overall decrease in labor and capital income. Decreasing production was also experienced in the construction, utility and service sectors. Job losses associated with decreases in catfish production have greater implications, especially when taking into account that job creation is one of the major development goals in the Delta Region. While catfish tariffs may not be justified by trade theory, negative impacts on communities are also important in the decision-making process.

Potential Economic Impacts of Adding Value to Catfish Processing Waste
|Aloyce R. Kaliba and Carole R. Engle

Processing of channel catfish (Ictalurus punctatus) to produce sellable products yields substantial quantities of unutilized processing waste. Depending on the product forms dictated by the marketing strategy of the processor, up to 47% of the fish weight is not usually utilized to produce sellable products and are discarded. These wastes can be processed into fishmeal and fish oil by two plants with a processing capacity of 200 metric tons per 24 hours (3 shifts).  It was estimated that the catfish processing plant would sort and sell the waste to fishmeal and fish oil plants at $0.22/kg ($0.1/lb) and generate about $28 million in additional annual sales. Catfish farmers will receive about $4 million, based on farm cost shares of about 15%. We used this information to simulate an IMPLAN economic multiplier model. Results indicated that these activities would generate $79 million in total economic output through direct ($50 million), indirect ($25 million) and induced ($4 million) impacts. The analogous amounts for employment were: total (600), direct (316), indirect (235) and induced (49) jobs. For labor income, the dollar amounts were: total ($13 million), direct ($4 million), indirect ($7 million), and induced ($2 million). In addition, about $8 million in federal tax and about $2 million in local and state tax were likely to be generated. Notice that while the investments create more jobs in the directly affected industries, it creates more paying jobs in industries that are indirectly linked, an important feature for rural economy stimulation. 

Economic Profitability of Nile Tilapia (Oreochromis niloticus l.) Production in Kenya
Aloyce R. Kaliba, Charles C. Ngugi, John Mackambo, and Kwamena K. Quagrainie

Economic profitability of Nile tilapia production in Kenya was analyzed using a model that simulated individual fish growth and took fish population dynamics in the pond into account. The results suggest that the current practice of mixed-sex tilapia culture is economically unsustainable. It is suggested that research and extension efforts be geared towards developing monosex Nile tilapia production systems. Nile tilapia culture with African catfish predation should be viewed as an intermediate step towards all-male Nile tilapia culture. This will allow accumulation of both physical and human capital to support all-male tilapia culture. Under all-male culture, economic returns are high enough to justify investment in Nile tilapia culture using borrowed capital. However, the success of monosex culture will depend on the availability and affordability of quality fingerlings and low cost fish feeds. The results have wide application in Sub-Saharan Africa where mixed-sex Nile tilapia culture is common.  

Economic Analysis of Nile Tilapia Production in Ghana
Aloyce R. Kaliba, Steve Amisah, Linus Kumah and Kwamena K. Quagrainie

Economic profitability of Nile tilapia (Oreochromis niloticus) production in Ghana was analyzed using a dynamic model that simulates individual fish growth and takes fish population dynamics in the pond into account. The results suggest that the current practiced mixed-sex tilapia culture with catfish predation was economically sustainable. However, to increase returns on investments, extension efforts should be geared towards developing a Nile tilapia production system that is based on a hand-sexed all-male tilapia culture. Other fundamentals include pond studies to determine optimal fish size, availability of affordable feed and quality fingerlings. Under an improved production system, profits are high enough to justify investment through borrowed capital. 

Potential Impact of Aquaculture Promotion on Poverty Reduction in Sub-Saharan Africa
Aloyce R. Kaliba, Charles C. Ngugi, John M. MaCkambo, Kajitanus O. Osewe, Ephraim Senkondo, Berno V. Mnembuka, and Steven Amisah

There is increased policy support towards aquaculture development in Sub-Saharan Africa. In the region, aquaculture expansion has potential to create new jobs and improve food security among poor households. Three computable general equilibrium models were used to estimate the effects of aquaculture expansion and increased input productivity on poverty reduction in Ghana , Kenya and Tanzania . The results suggest that there will be positive effects in per capita income for all households in Ghana and Kenya . In Tanzania , some rich households will experience income loss due to resource shift from other sectors to aquaculture. Due to decreases in poverty lines associated with decreases in relative price, and increases in the minimum income associated with income expansion, the poverty gap decreased in all household groups. Due to high sectoral linkages, aquaculture development is a potential candidate for sector-specific policy support to address poverty reduction issues in Sub-Saharan Africa. 

Profitability of Producing Organic Liquid Fertilizer from Catfish Processing Wastes
Aloyce R. Kaliba and Carole R. Engle

A liquefied fish product is one of the most economical methods of preserving value-added products from fish processing waste, as it can be further processed or transported to another location. A common practice is to produce liquid organic fertilizer from liquefied fish products known as hydrolysates. This study was conducted to determine economic profitability of adding value to catfish processing wastes by further processing the waste into liquid organic fish fertilizer. Adding value generates income and employment in rural areas where most catfish farm and processing plants are based. Results indicate that economic profitability of producing organic fish fertilizer depended on plant and minimum profitable plant size was about 12,500 lb/day. While investment in a small plant may add economic return to investment, economic merit was sensitive to cost of capital. Returns will be higher for higher equity financing that will allow reinvesting some of the revenue into the business. In addition, price of final product has to remain above $32.50/gallon to justify investment in small processing plants to produce fertilizer from fish hydrolysate. 

Profitability of Producing Fish Meal and Fish Oil from Catfish Processing Wastes
Aloyce R. Kaliba and Carole R. Engle

This study was conducted to determine economic profitability of adding value to catfish processing wastes by further processing the waste into fishmeal and fish oil. The major results indicate that processing the wastes into fishmeal and fish oil was economically viable. Plants producing fish meals and fish oils from catfish processing waste may gain by focusing on markets for high protein pet foods, salmon feeds, and the section of the dairy industry producing omega-3 milk. The stable supply and quality of raw materials from the catfish industry provides an advantage in manufacturing customer tailored fishmeal and fish oils.