Response to “Where are the fish? Home grown tilapia in short supply” published in Sunday Finance on MARCH 27, 2011

THE Aquaculture sub-sector has faced several challenges over the last few years and yet provides tremendous opportunities for our local farmers. Before we delve into this fascinating sub-sector, it is important to understand the market segmentation. The local market may be differentiated into the householder market, wholesale, retail, hotel and quick-service restaurants (QSR) market. Each of these markets requires a different product type. Whereas the householder, wholesale and retail market prefer a fresh whole tilapia, the hotels and QSR’s prefer a tilapia filet. Most of the tilapia product sold on the local market is in the form of live fish or fresh whole fish and all imported tilapia is in filet form. There is no importation of whole tilapia whatever. It is also important to note that unlike other animal proteins such as pork, chicken and beef, tilapia suffers competition not just from tilapia but from other fish, both fresh and sea, which are either imported or harvested locally.

Up until 2007/2008, Jamaica Broilers used to export substantial quantities of tilapia; however, after losing this market, their production was focused locally which led to a flood of tilapia supply on the local market driving prices down to a point that was unsustainable for the local farmer. In addition, the industry faced additional challenges including increasing fuel and commodity prices and the competition from cheap foreign imports for fish filet and other fish product substitutes. These challenges have resulted in the gradual contraction of fish farming as well as a change in the production practice of some fish farmers from intensive/super-intensive culture systems to intensive/semi-intensive fish culture production systems as farmers try to reduce costs associated with producing the fish.

The recent shortage of locally grown tilapia may be attributed in part to the constraints indicated in the foregoing as well as the impact of the floods produced as a result of the onslaught of Hurricane Nicole in September 2010, and the subsequent loss of seedstock production capacity of some hatcheries as well as food fish by some fish farmers.

The Ministry of Agriculture and Fisheries recognises the severe constraints that the local tilapia sub-sector is facing and has been operating under, and as such is working in close collaboration with industry stakeholders in producing workable solutions to alleviate some of these constraints.

Challenge of cheap fish imports

The Ministry of Agriculture and Fisheries (MOAF) in recognising the challenges posed by imported fish met with the industry stakeholders including farmers, processors, hotels and QSRs. What became clear from these discussions is that Jamaica is a high-cost producer of tilapia filet and our ability to compete not only with imported tilapia filet but other fish filet was limited at this time. To put it in perspective, the local price of tilapia filet is $450/lb whereas the imported price inclusive of duty is $210/lb. The QSRs and hotels simply were not prepared to pay close to a 100per cent increase in the cost of filet to support local production. They simply would opt for alternative fish filets, similar to what Wendy’s has done, and those markets would be lost. Instead, a decision was taken to accomplish the following:

1. Allow the importation of tilapia fish filet only for the QSRs and hotels

2. Develop local capacity to value add the filets for the QSRs and hotels

3. Develop local capacity to value add the whole fish (ex. pre-seasoned jerk fish) for local and export markets

4. Refuse the importation of whole tilapia, fresh or frozen

5. Establish an industry development plan to improve the efficiencies of the local farmers so that over time, local farmers would be able to replace the imported filet with local filet

6. Explore the export market for whole fresh tilapia since Jamaica has proximity to market advantages

7. Promote an “Eat tilapia” campaign to drive demand for the tilapia whole fish

The Ministry has been in discussion with certain establishments that have the capital infrastructure for processing to absorb some of the production from tilapia producers, thereby encouraging value added production in this segment of fish production which will hopefully be able to enter those markets competitively and with a higher quality product. It is recognised that Jamaica has comparative advantage in the whole fresh fish market. As such the Ministry has been encouraging a strategy to allow local producers of tilapia to capitalise on this market.

In 2010, the Agricultural Development Fund (ADF) was established. This fund was established with the specific intention of providing funds towards the development of sensitive agricultural industries. It is expected to provide funds to target specific projects/investment opportunities that are geared towards the development of aquaculture as prescribed in the Aquaculture Development Plan.

The Ministry of Agriculture and Fisheries is working with industry members to formulate a development plan and strategy for aquaculture as outlined in the Draft Fisheries Policy. This plan will ensure the orderly development of the sector and identify targets, timelines and incentives that will facilitate the sustainable development of the sector. An important component of this plan is the “Eat tilapia” campaign designed to drive the consumption of local tilapia as a healthy, tasty alternative to other imported fish.

The opportunities are vast in aquaculture if we take advantage of our comparative advantages and encourage local production by increasing market opportunities both here in Jamaica through the “Eat tilapia” campaign and overseas with our whole tilapia in its primary and value added forms.

Dr Marc Panton is the chief technical director at the Ministry of Agriculture and Fisheries