Economics

The economics of fish farming are what make it so attractive. There are few farming opportunities that can yield returns as quickly as fish farming can, particularly RAS systems in which production turnaround can be much quicker than in other production systems.

The biggest attraction of course is the market. Everyone knows the oceans are not producing more and yet we have an increasing population to feed. Fish, efficient converters of feed to mass, are increasingly farmed all over the world and being relatively new, aquaculture has a massive opportunity in front of it.

The facts are staggering. 6,500 tons of tilapia at 500g per fish is enough to give every single South African one tilapia to eat, once, every five years.

Current total tilapia production in South Africa is less than 500 tons.

At peak production the APU will produce 91 kg of 480 to 500g fish every 30 days. This is just over a ton a year of fish – around 2,300 annually. Please note that you will not get to peak production until you have some experience under your belt. Don’t be unrealistic in your expectations!!

If you sell these fish for R65/kg, all 1094 kg of it, your nett income is R71,110.00. This is of course one year after you have your first harvest (which will be 5 to 6 months after you start).

 

Opex Costs (ex VAT)    
Feed R14.35 /kg
Electricty R2.00 /kWhr
Water R5.00 /kl
Fingerlings R3.00 /fingerling
Labour    

 

Cost of Production    
Feed (FCR of 1.4) R21,980.00  
Electricity R7,085.00  
Water R500.00  
Fingerlings R7,020.00  

Your nett gross profit on this should then be around R34,525.00. But of course this is not the full picture – this is the gross profit that your asset can sweat out for you.

There are other costs that you will need to learn and to control. For instance we have not counted labour costs into this.

You need to learn how to farm productively with yourself and your work force and the secret to success is to develop your own production formula that you can replicate day in and day out with your team, even if that team is just you to begin with.

This is what the management tool will help step you through on a daily basis.

 

Selling price.

Let’s give you this to chew on. Increase your selling price to R75/kg.Your income increases by R10,940.00.

Now take it up to a retail price level of around R100/kg and what was already attractive starts to look mouth wateringly delectable – R109,400.00 for the annual production. Find one restaurant in your area and your entire production at this price is spoken for…