Future Growth of the U.S. Aquaculture Industry and Associated Environmental Quality Issues

1. Future Growth of the U.S. Aquaculture Industry and Associated Environmental Quality Issues Di Jin, Hauke Kite Powell, and Porter Hoagland Marine Policy Center Woods Hole Oceanographic Institution 16 November 2005

2. Outline • Broad trends in seafood production • Aquaculture supplies crucial in future • Policy questions • Types of marine aquaculture • Economic and ecological effects • Model framework • Open-ocean aquaculture in New England and simulation results • Summary

4. [N.b. some kinds of aquaculture draw upon the capture fisheries.]

5. World Aquaculture Production: $60 billion

6. Current and Projected World Fisheries andAquaculture Production (mmt)

8. US Landings and Imports (index)

9. US Aquaculture Production (mt) $126m $28m

10. Some Policy Questions • Can marine aquaculture expand to ensure the supply of seafood at current per capita consumption levels? • Can marine aquaculture reduce the US dependence on seafood imports? • Can we encourage the development of “sustainable” aquaculture? • What do we mean by “sustainable”?

11. Sustainable Agriculture . . . practices that meet current and future societal needs for food and fibre, for ecosystem services, and for healthy lives, and that do so by maximizing the net benefit to society when all costs and benefits of the practices are considered. . . If society is to maximize the net benefits of agriculture, there must be a fuller accounting of both the costs and the benefits of alternative agricultural practices, and such an accounting must become the basis of policy, ethics, and action. Tilman et al. (2002)

12. Types of Marine Aquaculture

13. Netpens

14. Longlines

15. Typology of Economic and Ecological Effects

16. Qualitative Assessment of Effects

17. Priority Issues for Sustainability • Nearshore finfish culture • disease transmission to wild stocks • escapement and interbreeding with or displacement of wild stocks • overexploitation of forage fish stocks • organic pollution • use conflicts • Open-ocean finfish culture • escapement and interbreeding with or displacement of wild stocks • overexploitation of forage fish stocks • Finfish ranching • depletion of natural stocks • use conflicts

18. Assimilative Capacity of the Coastal Environment and Industry Growth Potential Water quality standard Max N & P loading from aquaculture Current levels of N & P Aquaculture production level

20. Model Subject to

21. Fish stock growth Cost of fishing Cost of aquaculture production Investment in aquaculture Environmental damage

22. Marginal cost of aquaculture Marginal cost of fishing Steady-state fish stock Steady-state aquaculture production scale

23. Variable Description Unit Value p0 intercept of fish demand function $/MT 2,546 k slope of fish demand function $10-3/MT2 3.28 r Intrinsic growth rate time-1 0.3715 K carrying capacity 103 MT 1,681 q catchability coefficient day -1 0.000007 c unit cost of fishing effort (E) 103$/day 3.3  discount rate 0.07 Parameters for the Market and the Fishery

24. Variable Description Unit Value FCR average feed conversion ratio 1.365 w aquaculture production output per farm MT/farm 2,115 v Aquaculture production operating cost a 103 $/year/farm 3,615 (3,913) b investment cost a 103 $/farm 7,514 (7,792) 12E(fq) feed quantity MT/year/farm 2,765 QBOD biochemical oxygen demand (BOD) MT/year/farm 968 QTN total nitrogen (TN) MT/year/farm 83 QTP total phosphorus (TP) MT/year/farm 14 QTSS total suspended solids (TSS) MT/year/farm 830 Parameters for Open-Ocean Aquaculture a. Values are associated with feed cost (fp) = $0.50/kg and $0.60/kg (in parentheses), respectively.

25. Output Variables Description Unit Without Damage With Damage Rising Imports x fish stock 103MT 847.51 843.81 847.51 E fishing effort 106 days 26.314 26.431 26.314 hf fishing landings 103MT 156.11 156.12 156.11 s aquaculture industry size farms 10.96 4.14 3.25 ha aquaculture production 103MT 23.18 8.76 6.88 h total fish supply 103MT 179.30 164.88 163.00 NBOD total BOD MT 10,609 4,008 3,146 NTN total TN MT 910 344 270 NTP total TN MT 153 58 46 NTSS total TSS MT 9,097 3,436 2,698 Simulation Results

31. Summary • Reviewed the market trends in seafood production. • Reviewed economic and ecological effects resulting from marine aquaculture. • Existing studies project the future expansion of marine aquaculture industry based on the assimilative capacity of the coastal environment. • Developed a market-oriented approach for projecting future industry expansion. • Developed a New England case study for open-ocean aquaculture. • Socially optimal solution involves a combination of wild harvest fishery and aquaculture. • Future size of open-ocean aquaculture industry is affected by its costs and productivity, effectiveness of pollution control, and growth in seafood demand.