Econometric model of viability/profitability of octopus (Octopus vulgaris) ongrowing in sea cages

Abstract

The interest in diversifying aquacultural production with new species is evident, preferably with species with a high commercial value and whose consumption is not geographically limited. In this sense, octopus would be a good choice. The present work, therefore, presents an economic-financial analysis of the commercial viability of octopus ongrowing in the Mediterranean, paying special attention to the one- or two-cycle approach. Viability–profitability equations are developed for analysing economic parameters associated with production. To estimate the investment, an offshore ongrowing installation was designed comprising 150 cages containing 30,000 individuals. Growth was estimated for the two strategies: (A) Two consecutive cycles per year (2CY), each lasting 3.5 months from October to June. Initial weight was 0.7 kg, and the mean final weight was 2.7 kg. (B) One growth cycle per year (1CY) beginning in November or December and finishing in April or May, starting with the same weight individuals (0.7 kg) and giving individuals with a final weight of 3.65 kg. The highest costs, the most important from an economic point of view, are feed (38.57 and 40.03%, respectively), fixed assets (25.26 and 17.47%, respectively), juveniles (16.65 and 23.02%, respectively), and in fourth place salaries (14.34 and 15.60%, respectively). The equations obtained for the variables NPV (Net Present Value) and IRR (Internal Ratio of Return) are the following: 1 cycle per year (1CY), NPV = −489,088 − 1.45 K − 1,439,823 CF − 1,477,890 CJ − 1,460,627 CO + 1,432,386 SP, IRR = 0.1328 − 7.82 × 10−8 K − 0.0416 CF − 0.0437 CJ − 0.0427 CO + 0.0412 SP. 2 cycles per year (2CY), NPV = −404,431 − 1.46 K − 2,118,410 CF − 2,121,221 CJ − 2,144,755 CO + 2,129,223 SP, and IRR = 0.0952 − 6.95 × 10−8 K − 0.0586 CF − 0.0588 CJ − 0.0588 CO + 0.0613 SP. The NPV and IRR values estimated with the econometric equations for each option using the initial variables confirm that 1CY has a higher NPV (3,013,569 €) and IRR (12.27%) than 2CY, with an NPV of 2,396,708 € and IRR of 10.39%. In both cases, octopus ongrowing is economically viable, although 1CY is the most favourable system.