n a University of Florida operational analysis, a model business analysis suggested that a small-scale, outdoor pond tilapia culture facility could be profitable. Positive average annual net returns and a cash flow that is positive throughout a five-year planning horizon supported this conclusion. Given the assumptions concerning yield, harvest size, market prices and per-unit input costs, the hypothetical six-acre tilapia culture facility required an initial investment of $65,850 and generated $40,259 in annual operating costs, yielding $29,221 in net returns during an average year. However, variables including market price, feed costs, survival rates, technical ability, geographic location of the facility, prevailing market conditions and additional factors including other input prices and stocking densities were also shown to potentially influence profits. Given the increase in feed costs over the past decade, productivity would have to improve for this model facility to maintain profitability.
Lutz (2000) examined the comparative production costs of U.S. tilapia operations (open ponds, greenhouse facilities and enclosed indoor tank systems) with those of tropical production facilities and concluded that improved strains and technology would be required to allow for competition in domestic fillet markets. These advances have not been forthcoming, and production costs have increased over the past decade. With the availability of frozen tilapia imports from China, almost all of the tilapia cultured in the United States is sold as a live product to attract the premium price necessary to cover production costs. This situation is not expected to change in the foreseeable future. Producers in the United States must focus on developing markets for live products, improving management and technology for recirculating aquaculture production, and managing procurement (fingerlings and feed) and inventory aspects of their operations.
n a University of Florida operational analysis, a model business analysis suggested that a small-scale, outdoor pond tilapia culture facility could be profitable. Positive average annual net returns and a cash flow that is positive throughout a five-year planning horizon supported this conclusion. Given the assumptions concerning yield, harvest size, market prices and per-unit input costs, the hypothetical six-acre tilapia culture facility required an initial investment of $65,850 and generated $40,259 in annual operating costs, yielding $29,221 in net returns during an average year. However, variables including market price, feed costs, survival rates, technical ability, geographic location of the facility, prevailing market conditions and additional factors including other input prices and stocking densities were also shown to potentially influence profits. Given the increase in feed costs over the past decade, productivity would have to improve for this model facility to maintain profitability.
Lutz (2000) examined the comparative production costs of U.S. tilapia operations (open ponds, greenhouse facilities and enclosed indoor tank systems) with those of tropical production facilities and concluded that improved strains and technology would be required to allow for competition in domestic fillet markets. These advances have not been forthcoming, and production costs have increased over the past decade. With the availability of frozen tilapia imports from China, almost all of the tilapia cultured in the United States is sold as a live product to attract the premium price necessary to cover production costs. This situation is not expected to change in the foreseeable future. Producers in the United States must focus on developing markets for live products, improving management and technology for recirculating aquaculture production, and managing procurement (fingerlings and feed) and inventory aspects of their operations.
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