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State catfish farmers struggling to stay afloat Sunday, May 25, 2008 By Rob Moritz Arkansas News Bureau LITTLE ROCK - The high cost of feed and cheap competition have forced Leyden Pugh of Lake Village out of the catfish business. Also feeling the pinch from foreign imports and rising grain costs, Jerry Seamans is cutting back his 1,200 acres of catfish ponds by 20 percent and returning the acreage to soybeans and rice. "I really don't know of a fish operation that's not changing," said Seamans, whose farm is just outside of Lake Village. "Some people are going out of business, several people are doing the same thing I'm doing. Most everybody in the business is trying to make major adjustments." Catfish farming is a $600 million industry in Arkansas down about $120 million from five years ago, said Carole Engle, director of aquaculture and the fisheries center at the University of Arkansas at Pine Bluff. At its peak in 2002, Arkansas' catfish industry numbered 195 operations covering 38,000 acres of ponds. The latest numbers from the U.S. Department of Agriculture show 128 catfish farms with 29,900 acres of ponds. Production has dropped from 106,821 pounds two years ago to the current 90,400 pounds. The industry is struggling nationally, and catfish consumption among Americans is down slightly, especially in California and New York City where imports are selling better, officials say. State agriculture officials and researchers say the catfish industry in Arkansas - ranked third nationally in production - has taken hits in recent years for a variety of reasons, but they say there are some signs the worst may be behind producers. Commercial catfish farming developed in Arkansas about 50 years ago, and the number of producers rose dramatically in the 1990s. Farmers saw raising catfish as a way to bolster profits while the price of cotton and soybeans was low. In recent years, however, catfish farmers have struggled with competition from cheaper imports, state Agriculture Secretary Richard Bell said. Catfish and tilapia from China, and basa, a Vietnamese catfish, have become popular in the United States because of the low cost and comparable taste to domestic catfish. Also, the rising cost of corn and soybeans, key ingredients in producing alternative fuels like ethanol and biodiesel, have "put the squeeze on" farmers, Bell said. Both the state and federal governments offer incentives to grow the grains for use in alternative fuel production, he noted. "It's a tough area right now," Bell said. Production costs also are hurting catfish farmers, said Ted McNulty, director of aquaculture for the state Department of Agriculture. Catfish feed sells for about $400 a ton. "The fish need to sell for 90 cents a pound for a farmer really to break even, and right now 75 cents is what they are getting," McNulty said. State catfish farmers also are still suffering from drought and other natural disasters, Bell said, adding that about $3.7 million in federal disaster aid has been distributed to producers in the state in recent years. Engle acknowledged the state industry's troubles but said all is not lost. "This is certainly not the end of the catfish industry," Engle said. The decision by many catfish farmers to reduce their number of ponds, mostly those that are less efficient, will probably make the industry more effective, she said. Also, rising grain prices has prompted catfish feed producers to push for the development of quality, yet less expensive feeds. "The good news is there are some new feed formulations and there is testing with those new and lower cost feed formulations that is going well," Engle said. "What is happening across the (feed) industry is, we're seeing a lot of innovations." To further cut costs, the Catfish Farmers of Arkansas plans to petition the state Public Service Commission for a reduction in the electric rates producers pay. Seamans, who is on the industry trade association's board, said 90 percent of a catfish farmer's energy use is from large aerators used to pump air into the ponds during the night. Farmers currently pay the agriculture rate, which is for peak usage, even though the aerators run during off-peak hours. McNulty said a rate change would save the farmers money. "We feel like they should have a lower rate; not just catfish, but all other bait fish," he said. Other issues still must be addressed at the federal level, Engle said, including trade issues with heavily subsidized imports from Vietnam and China, as well as food safety concerns - laws governing the types of chemicals that can be used to help fish grow in China and Vietnam are less stringent than in the U.S. Until the state and federal governments begin inspecting foreign fish like they do meat and poultry, U.S. catfish farmers will be at a disadvantage, said Pugh, who is closing 920 acres of catfish ponds in Chicot County. Many of the chemicals used to help fish in Vietnam and China grow faster and bigger are banned in the U.S., he noted. Last year, state officials discovered the antifungal agent crystal violet in samples of about 27,000 pounds of imported catfish taken from six Arkansas wholesale distributors. The fish were being tested for antibiotics, which are illegal in the U.S., when the crystal violet was discovered. None of the fish tested positive for antibiotics. The crystal violet-tainted fish was quarantined and later destroyed. "We don't want to stop imports," Pugh said. "We just want imports to follow the same guidelines that we do. That's fair to the consumer." U.S. Rep. Mike Ross, D-Prescott, filed legislation last month that would toughen the inspection requirements of imported catfish, basa and tilapia. |
