ABSTRACT
The study examines the profitability of fish production at Odeda Local Government area of Ogun State, Nigeria. To determine the profit level, attempts were made to estimate the cost and return analysis from fish farming using input such as feeds, water, lime etc used for the rearing the fish. The cost and return analysis reveal that the variable cost accounted for the largest proportion of the total cost of fish farming in the study area. The descriptive analysis showed that a large proportion 68% of the fish farmer had formal tertiary education and finances their fish production through personal savings. This shows that larger amount of money spent by fish farmers in the study area were mainly on purchase of fish feeds and pond reconstruction. Fish farmers were confronted with a number of problems in fish farming enterprise in the study area which are lack of processing, preservation, storage facilities, land acquisition. The study included that catfish enterprises are recent means of livelihood among middle age and highly educated dwellers. Recommendation this constrain could be addressed by the farmers forming a formidable group of cooperarive societies with aids from non-governmental organisation and other organized private sectors to establish fish feed mill for quality feed at affordable price.
CHAPTER ONE
1.0 INTRODUCTION
1.1 BACKGROUND TO THE STUDY
Throughout the centuries, fish has been an important component of human diet in many parts of the world. Fish catches increased rapidly over the past hundred years due to improved technology which provided more powerful fishing engines and equipment. This led to over fishing and caused a worldwide decrease in wild stocks and the need to increase fish production by fish farming (aquaculture) (Carballoet al., 2008). The term aquaculture ‘covers all forms of cultivation of aquatic animals and plants in fresh, brackish and saltwater. Aquaculture has the same objective as agriculture, namely, to increase the production of food above the level that would be produced naturally. Nigerians are high fish consumers and offer the largest market for fish and fisheries products in Africa. Fish farming has thus become an important venture in the quest for food security and eradication of malnutrition especially among infants (Awotide, 2012). With an annual fish demand in the country of about 2.66 million tonnes, and a paltry domestic production of about 780,000 tonnes, the demand-supply gap stands at a staggering 1.8 million tonnes. Despite the popularity of farming in Nigeria, the fish farming industry can best be described as being at the infant stage when compared to the large market potential for its production and marketing (Nwiro, 2012). Although aquaculture in Nigeria has the potential for satisfying the increased demand for protein and has been experiencing unprecedented growth during the last decade, question remains regarding the sustainable development of the industry (Adeogun, 2012).
Fish farming activity in Nigeria started about 50 years ago, with the establishment of a small experimental station at Onikan Lagos and an industrial farm about 20ha at Panyam in Plateau State by the Federal Government of Nigeria (Olagunju, 2007). This generated a lot of interest in fish farming with the involvement of other levels of government and some private establishments. In recent times, Nigeria has witnessed an unprecedented interest by entrepreneurs in fish farming. This is largely due to scarcity of fish in the local markets in addition to the high export potentials of our local shell fish species in international markets. The use of high technology in catfish farming is the latest in aquaculture system that has attracted numerous investors due to its tremendous success.
The Nigerian aquaculture industry, driven mainly by catfish farming, is seen as the fastest growing sub-sector in the Nigerian fish industry. Fish farming is rapidly gaining grounds in the northern part of Nigeria since the 1990s. Suffice to note however, that the rate of development has hastened right from 2005 when the Bird Flu scourge laid its deadly hands on the poultry industry. This made many poultry farmers to wisely diversify into or change their businesses to fish farming which has much less risk and yet a shorter production period, less consumer resistance, a wider market and much more revenue yielding. Prior to this period, the Sahel and Sudan Savannah Zones of the upper North, according to popular belief, are the most unlikely areas to raise fish in Nigeria. With very hot days and very cold nights, little or no surface drainage, intense sunlight, low rainfall and very low relative humidity, the area is indeed a difficult place to raise fish. However, in view of the current trend in development and evolution of aquaculture science and technology, fish farming is now very possible anywhere, even in arid environments (www.businessday.com, 2008).
Fish farming has great potentials for the production of high quality food for domestic use and export. However, it is still relatively new and on small scale especially in the Northern parts of the country. This problem is compounded by the increasing encroachment of the Sahara desert (almost two kilometers a year); ageing and perennial drying up of rivers and streams; the rising diurnal heat: extensive situation and shrinking of the Lake Chad and consequent low fish catches (Sharon, 2008). However, even with the enormous potential for fish farming in the north, the problem of protein deficiency has continued unabated. The need therefore arose, to explore aquaculture as a means of curbing this menace. Aquaculture has attracted much interest on account of assumptions that there is limited risk in terms of mortality from natural sources, and that the feeding of fish is not as complicated as that of poultry and may not require imported feed concentrates with high foreign exchange needs.
1.2 PROBLEM STATEMENT
According to the Federal Department of Fisheries Statistics (1991-2000), the total fish production in Nigeria for ten-year period (1991-2000) averaged about 420, 000 metric tonnes (MT), while production from aquaculture during the same period ranged from 15,840 to 25,720 metric tonnes. Aquaculture therefore accounted for only 5.3 % to 6.2 % of total fish production (Business Daily Online, 2008).As a maritime nation with a vast population of over 160 million people and a coastline measuring approximately 853 kilometres, fish production as an enterprise possesses the capacity to contribute significantly to the agricultural sector of Nigeria (Osagie, 2012). Out of 35 grams of animal protein per day per person recommended by F.A.O, less than 7 grams is consumed by Nigerians on the average. As a result of this, many Nigerians suffer from protein deficiency due to low protein intake. In order to meet up with domestic fish need, Nigeria has become one of the largest importers of fish in the developing world, importing about 600,000 MT annually. This is a real burden onthe limited foreign exchange (FAO, 1991). Spaulding et al. (1997) observed that the major constraints to fish farming were related to environmental impacts of aquaculture operations such as water pollution, inadequate supply of fingerlings, inadequate information and feeds supply. Fish pond aquaculture production is currently very low, estimated at below 10,000 MT per annum from a total water surface area of about 5, 500 hectares. It has been estimated that if Nigeria is to be self-sufficient in fish production through aquaculture, a total of about 900,000 MT of fish a year is required i.e. estimated at a minimum production of one metric tonper hectare per year.
Since fish culture is basically a commercial venture, private investors are being encouraged to go into this business. Banks and commercial houses are currently showing increased interest in granting investment loans for such ventures following the sudden decline in the poultry industry due to the high cost of feeds and the menace of bird flu (FAO, 2007). Nigerian investors have been forced to explore new possibilities, particularly in animal husbandry and aquaculture. Aquaculture has attracted much interest on account of assumptions that there is limited risk in terms of mortality from natural sources, and that the feeding of fish is not as complicated as that of poultry and may not require imported feed concentrates with high foreign exchange needs. Based on these assumptions, some investors have plunged headlong into this new field of animal farming with little or no in-depth knowledge of fish farming or supporting information on its feasibility and the consequence is risk of dismal failure in the venture (FAO, 2007).
It is pertinent to note that the issue of economic analysis is very crucial in project conception and implementation. For this reason, this study was conceived with the aim of providing empirical information on the profitability analysis of fish production.
1.3 OBJECTIVES OF THE STUDY
1.3.1 General Objective
The general objective of the study was to analyze the profitability analysis of fish production in Odeda Local Government area of Ogun State, Nigeria.
1.3.2 Specific Objectives
The specific objectives were to:
1. Describe the socio-economic characteristics of the fish farmer in the study area.
2. Determine the costs and returns (profitability)of fish production at various scales of operation;
3. Determine the constraints facing fish farmers production in the study area.
4. To make useful recommendations based on the outcome of this research
1.4 JUSTIFICATION OF THE STUDY
Based on the current trend in development and evolution of aquaculture science and technology, fish farming is now very possible anywhere, even in arid environments. The increasing encroachment of the Sahara desert (almost two kilometers a year); ageing and perennial drying up of rivers and streams; the rising diurnal heat; and shrinking of the Lake Chad have caused relative scarcity of fish, and this therefore called for the need to improve on fish production through aquaculture (Sharon, 2008). The fledgling aquaculture industry surely could have terrific potentials to develop, expand and generate wealth and jobs, particularly in rural communities with limited economic alternatives. Progress in this direction clearly looks very promising. Wealth from aquaculture has brought economic prosperity to rural dwellers in many developing countries such as Thailand, Indonesia, India, Malaysia, Taiwan and China. Employment in the sector is growing faster than population and it is not only a source of wealth but of health; aquaculture is playing significant role in eliminating hunger, promoting health and reducing poverty. More than ever before, aquaculture and fisheries has become a source of food, employment and income, as well as providing raw materials for production fertilizer and other farm inputs, and domestic products in the Developing World (FAO, 2014). It is hoped that the findings of this dissertation will be of immense benefits to potential investors, farmers, extension workers and financial institutions to provide the most viable options for investment and opportunities for wealth creation. This research will also be useful to policy makers to develop strategy for development of a robust aquaculture industry to complement the livestock and agricultural cash crop productions that could translate into the much needed industrial growth for the country.