Trading Catfish For Corn
If your farmed fish fillets are pricier than usual, the reason why isn't necessarily found in the water or in the gas tank. No, if you're paying more for farmed fish, and you probably are, look no further than the nearest cornfield. The rising cost of agricultural commodities is having a direct impact on the cost of farmed fish.
Corn, soy and wheat prices, by the barrel, are more than double what they were back in 2001, according to the National Agricultural Statistics Service. What's more, the price of fishmeal has jumped from about $800 a ton last year to about $1,800 a ton this year. Increasing demand for these products - all of which are components in common fish feed formulations - is shaking the aquaculture industry at its foundation, which is price stability.
The bad news is that when prices for such commodities rise, they rarely come back down. The good news is that most food products are more expensive, so bumping your tilapia fillets from $6.99 a pound to $8.50 probably won't rankle too many consumers. They're getting used to digging deeper in their wallets.
Fish farmers are making moves to keep costs down and, at the same time, improve their sustainability profile. One way is by reformulating their fish feed. As we reported a couple of weeks ago, Kona Blue Water Farms in Kailua-Kona, Hawaii, cut the fishmeal inclusion ratio of its feed to about 20 percent, down from 80 percent when it first started growing kampachi. For the upcoming October Top Story in SeaFood Business, "Feeding Frenzy," I spoke with numerous fish farmers and feed manufacturers who confirmed that reformulations are commonplace.
Once-struggling crop farmers are now buoyed by the emergence of ethanol and alternative fuel manufacturers as new customers. Higher prices for fish feed aside, this new market dynamic could hurt the seafood industry in another way: By slowing the development of the organic seafood market here in the United States. One catfish farmer told me that because crop farmers are doing so well, they have little incentive to switch from conventional means of production to grow organic crops.
So, even if the U.S. Department of Agriculture were to green-light organic seafood, as it could do by the end of this year for herbivorous species, there may not be enough organic feed available to grow certified-organic seafood, even as the market demands it.
No wonder so many catfish farmers are draining their ponds - to grow corn.