Economic profitability of tilapia farming in China

Abstract

Tilapia is an internationally farmed trade species recommended by the United Nations Food and Agriculture Organization, which is promoted and farmed in more than 100 countries and regions. In China, tilapia culture is a promising aquaculture business and it occupies an important position in global tilapia culture. In this study, profitability analysis was used to analyze the production costs and economic benefits of different farming sizes among the main tilapia-producing areas of China. Sensitivity analysis was conducted to analyze the impact of uncertainty factors on net profit of tilapia farming. Details of the costs and benefits of tilapia culture in China could support financial planning by fish farmers. The economic profit indices measured in this study comprised the total profit, gross income, profit margin, and benefit-cost ratios. The results indicated that large farms has the highest cost and the highest cost-profit margin among the three categories, and the small farms has the lowest cost and profit margin, while the cost and profit margin of medium size are between the large and small sizes. Sensitivity analysis shows that the net profit of tilapia is very flexible to the change of price, feed, rent, and fixed cost, of which price elasticity was the highest, followed by the feed, rent, and fixed cost. According to the problems existing in the tilapia farming, some policy suggestions were put forward for sustainable tilapia culture.