Jay Warecki, Ph.D. Jay Warecki, Ph.D.

© 2013 Superior Aquaculture, LLC

Budget Comparison of In-pond Raceways vs. Open-

Pond

What do you see ?What do you see ?

Do You See…?• Increasing feed costs

• Increasing energy costs

• A depressed economy

• Unfair competition from imports

• Increasing environmental mandates

• Lower prices to growers

Is This You ?(As we fish for complementary sciences.)

◊ LEFT: Depressed, shrunk, reduced phospholipids.

◊ RIGHT: Normal after 30-90 days of omega-3’s.◊ CRITICAL for brain development and

maintenance.◊ Controlling every cell, enzyme, and sense, e.g.

vision◊ A game-changer for growers, fish, &

consumers.

Is This You ?(As we fish for complementary sciences.)

◊ LEFT: Depressed, shrunk, reduced phospholipids.

◊ RIGHT: Normal after 30-90 days of omega-3’s.◊ CRITICAL for brain development and

maintenance.◊ Controlling every cell, enzyme, and sense, e.g.

vision◊ A game-changer for growers, fish, &

consumers.

What I SeeWhat I See

A massive, solar-powered, food machine

where harvesting yields new life.

Micro Algae: 80% of all settleable solids

---8 liters/min/raceway flowing in. ---Valuable lipids for feed,

biodiesel, etc ---Excellent amino acid profiles ---The freshwater source of all

omega-3

A massive, solar-powered, food machine

where harvesting yields new life.

Micro Algae: 80% of all settleable solids

---8 liters/min/raceway flowing in. ---Valuable lipids for feed,

biodiesel, etc ---Excellent amino acid profiles ---The freshwater source of all

omega-3

What Else I SeeWhat Else I SeeZooplankton:1.2 Billion live zooplankton,

weighing about 100 Lbs./hr./raceway. Bio-accumulated omega-3’s critical

for fingerlings, immune systems & marketing

An on-farm, renewable source of high-value nutrients.

A perfect example of sustainable, Integrated Multi-Trophic Aquaculture.

I see all this and more because in-pond raceways enhance observation & control.

Zooplankton:1.2 Billion live zooplankton,

weighing about 100 Lbs./hr./raceway. Bio-accumulated omega-3’s critical

for fingerlings, immune systems & marketing

An on-farm, renewable source of high-value nutrients.

A perfect example of sustainable, Integrated Multi-Trophic Aquaculture.

I see all this and more because in-pond raceways enhance observation & control.

Farm Animal Production Trends

Farm Animal Production Trends

Turkeys Chickens Hogs FISH Movement toward highly controlled

growing conditions & thus higher intensities.

Turkeys Chickens Hogs FISH Movement toward highly controlled

growing conditions & thus higher intensities.

Recent In-Pond Raceway History

Recent In-Pond Raceway History

Two basic types: Floating & Non-Floating

Work “Spearheaded” by Dr. Michael Masser with floating raceways in the mid 1990’s +

Major contributions by Dr. Dave Brune of Clemson with the (non-floating) PAS

Numerous other contributors, including those working with “split ponds”.

Two basic types: Floating & Non-Floating

Work “Spearheaded” by Dr. Michael Masser with floating raceways in the mid 1990’s +

Major contributions by Dr. Dave Brune of Clemson with the (non-floating) PAS

Numerous other contributors, including those working with “split ponds”.

(More) Recent History

(More) Recent History

An aluminum, floating raceway developed by Dr. Hansen and colleagues at Auburn, about 2008.

Construction costs “above our pay-grade”.

An aluminum, floating raceway developed by Dr. Hansen and colleagues at Auburn, about 2008.

Construction costs “above our pay-grade”.

Current History Current History

Dr. Jessie Chappel, colleagues, & growers from Auburn , about 2009, concrete.

Their most recent work: a 2-cell, poly (40-60 mil) lining over steel framed wall sections, 2011.

Dr. Jessie Chappel, colleagues, & growers from Auburn , about 2009, concrete.

Their most recent work: a 2-cell, poly (40-60 mil) lining over steel framed wall sections, 2011.

More Current HistoryMore Current History

The practical and affordable solution? Floating or Sit-0n-Bottom; 1/8 in. thick HDPE. ANY Size. Early 2000’s; Patented to Jay & Bonnie Warecki in 2006. Years of successful use studied by Dr. Hartleb and

colleagues, University of Wis. (2004-2007). World Aquaculture Conf., Aquaculture Magazine, Amer.

Fish Soc. Listed in “Best Management Practices for

Aquaculture…” 2006

The practical and affordable solution? Floating or Sit-0n-Bottom; 1/8 in. thick HDPE. ANY Size. Early 2000’s; Patented to Jay & Bonnie Warecki in 2006. Years of successful use studied by Dr. Hartleb and

colleagues, University of Wis. (2004-2007). World Aquaculture Conf., Aquaculture Magazine, Amer.

Fish Soc. Listed in “Best Management Practices for

Aquaculture…” 2006

Significant Variable CostFactors

Significant Variable CostFactors

(Approx. 95%)(Production Levels) Fingerling

CostsFeed Costs ElectricityFeed Conversion Ratios HarvestingSurvivorship Meds. &

Chem.

(Approx. 95%)(Production Levels) Fingerling

CostsFeed Costs ElectricityFeed Conversion Ratios HarvestingSurvivorship Meds. &

Chem.

Production Level Assumptions

Production Level Assumptions

3 raceways/6 acre pond.

IPRS: 30,000 Lbs/acre 180,000 Lb/pond

O-Pond: 8,000 ” ” 48,000 ” ”

8,000Lbs/acre is Alabama average—catfish.

5,200Lbs/acre is North Carolina ave.-catfish.

8,000Lbs/acre (approx.) Texas ave.-catfish.

Quantity of nutrients woefully lacking, especially the more expensive ones

3 raceways/6 acre pond.

IPRS: 30,000 Lbs/acre 180,000 Lb/pond

O-Pond: 8,000 ” ” 48,000 ” ”

8,000Lbs/acre is Alabama average—catfish.

5,200Lbs/acre is North Carolina ave.-catfish.

8,000Lbs/acre (approx.) Texas ave.-catfish.

Quantity of nutrients woefully lacking, especially the more expensive ones

Harvest Densities, CatfishHarvest Densities, Catfish1.8Lbs/gal achieved, Auburn, IPRS,

2010 +Harvest densities > 1.8 achieved for

many species.Assuming 1.55Lbs/gal for “Tables

1&2”.A 40,000 gal (usable water) IPR can

yield 62,500 Lbs.Thus, 3 IPR’s can yield 30,000Lbs/acre,

or 180,000Lbs/6 acres/cycle, while only carrying 15,000Lbs/acre at a time, which is only ½ of the pond’s estimated 30,000Lb/acre carrying capacity.

1.8Lbs/gal achieved, Auburn, IPRS, 2010 +

Harvest densities > 1.8 achieved for many species.

Assuming 1.55Lbs/gal for “Tables 1&2”.

A 40,000 gal (usable water) IPR can yield 62,500 Lbs.

Thus, 3 IPR’s can yield 30,000Lbs/acre, or 180,000Lbs/6 acres/cycle, while only carrying 15,000Lbs/acre at a time, which is only ½ of the pond’s estimated 30,000Lb/acre carrying capacity.

Feed Conversion Ratios (FCR’s)

Feed Conversion Ratios (FCR’s)

Most Alabama catfish farmers: 2.8-3.0:1

Texas channel catfish farmers: 2.4-2.9:1

Texas HSB farmers, estimated: 2.6:1 Raceway users elsewhere routinely

achieve 1.1-1:1. Auburn researchers/growers

achieved:1.2-1.5 in 20101.1-1.2 in 2012We have assumed a 1.2 FCR for

“Tables 1 and 2”.

Many from overseas with zero scrutiny

Most Alabama catfish farmers: 2.8-3.0:1

Texas channel catfish farmers: 2.4-2.9:1

Texas HSB farmers, estimated: 2.6:1 Raceway users elsewhere routinely

achieve 1.1-1:1. Auburn researchers/growers

achieved:1.2-1.5 in 20101.1-1.2 in 2012We have assumed a 1.2 FCR for

“Tables 1 and 2”.

Many from overseas with zero scrutiny

High-Tech Feeding SystemsHigh-Tech Feeding Systems

Feed the fish, not the pond. Critical for achieving optimal FCR’s. Feeding many times daily and at night. Feeding only when fish eagerly feed,

using an automated feed verification system.

Automated, computer assisted, labor-saving systems with safe-guards work.

Iron-nutrient imbalances a major contributor to nausea and vomiting during pregnancy (NVP)

Feed the fish, not the pond. Critical for achieving optimal FCR’s. Feeding many times daily and at night. Feeding only when fish eagerly feed,

using an automated feed verification system.

Automated, computer assisted, labor-saving systems with safe-guards work.

Iron-nutrient imbalances a major contributor to nausea and vomiting during pregnancy (NVP)

Feed CostsFeed Costs Assume feed costs will increase. At $500/ton (Aug. 2012), and a 2.8

FCR, feed cost=$0.70/Lb. harvested. At $500/ton and a 2.8 FCR, every

$100/ton feed increase=$0.14/Lb. product increase.

HOWEVER

At $500/ton and a 1.2 FCR, every $100/ton feed increase=$0.06/Lb. product increase.

This also holds for $600/ton and higher. Clearly, more expensive feed

MANDATES better feed management.

Also related to low intake of cereals, suggesting cereal snacks such as “Total” may be both helpful and healthy

Management of heartburn and reflux can reduce severity of NVP

Assume feed costs will increase. At $500/ton (Aug. 2012), and a 2.8

FCR, feed cost=$0.70/Lb. harvested. At $500/ton and a 2.8 FCR, every

$100/ton feed increase=$0.14/Lb. product increase.

HOWEVER

At $500/ton and a 1.2 FCR, every $100/ton feed increase=$0.06/Lb. product increase.

This also holds for $600/ton and higher. Clearly, more expensive feed

MANDATES better feed management.

Also related to low intake of cereals, suggesting cereal snacks such as “Total” may be both helpful and healthy

Management of heartburn and reflux can reduce severity of NVP

SurvivorshipSurvivorship Fingerling costs are about 20% of all

variable costs. Survivorship in open-ponds: about 55%. Survivorship in IPRS: about 90%.

Fingerling costs are about 20% of all

variable costs. Survivorship in open-ponds: about 55%. Survivorship in IPRS: about 90%.

Fingerling Stocking Costs

Fingerling Stocking Costs

45% fewer fingerlings needed in IPRS.

45% reduced feed costs from Day 1.

Reduced fingerling costs (alone) can equal savings of $0.05/Lb harvested, assuming a $0.13/fingerling cost.

Growth assessment and survivorship easily observed in raceways.

45% fewer fingerlings needed in IPRS.

45% reduced feed costs from Day 1.

Reduced fingerling costs (alone) can equal savings of $0.05/Lb harvested, assuming a $0.13/fingerling cost.

Growth assessment and survivorship easily observed in raceways.

Electrical CostsElectrical CostsOxygenate the fish, not the whole

pond.Modern, diffuser grid airlifts much

more efficient than paddle wheels.At first glance, 24/7 raceway aeration

costs similar to short-term, intermittent whole pond aeration.

Long-term objective and savings: Significant reduction in acuity of D.O. swings.

Psychosocial factors which are impacted by education, motivation, empowerment, and accountability need to be addressed

Attitudes and behavior of providers CRITICAL

Oxygenate the fish, not the whole pond.

Modern, diffuser grid airlifts much more efficient than paddle wheels.

At first glance, 24/7 raceway aeration costs similar to short-term, intermittent whole pond aeration.

Long-term objective and savings: Significant reduction in acuity of D.O. swings.

Psychosocial factors which are impacted by education, motivation, empowerment, and accountability need to be addressed

Attitudes and behavior of providers CRITICAL

Harvesting CostsHarvesting Costs

Fish pumps and/or raceway seining are much easier, thorough, and fish-friendly than pond seining.

Net savings in harvesting costs estimated @ about $0.02/Lb.

Written hand-outs, website links, and group presentations help educate

“Buddy Programs” and written “Contracts with Self” help hold accountable

Web-based, interactive programs highly effective, efficient, and inexpensive

Fish pumps and/or raceway seining are much easier, thorough, and fish-friendly than pond seining.

Net savings in harvesting costs estimated @ about $0.02/Lb.

Written hand-outs, website links, and group presentations help educate

“Buddy Programs” and written “Contracts with Self” help hold accountable

Web-based, interactive programs highly effective, efficient, and inexpensive

Medicine and Chemical Costs

Medicine and Chemical Costs

Water treatment and chemical costs can approximate 2.5% of variable costs.

Early observable problems in raceways can often be effectively mitigated and controlled at a fraction of the cost of open-pond treatments.

The above can include the reduction of off-flavor issues.

Water treatment and chemical costs can approximate 2.5% of variable costs.

Early observable problems in raceways can often be effectively mitigated and controlled at a fraction of the cost of open-pond treatments.

The above can include the reduction of off-flavor issues.

Table 1Most Significant Variable Expenses

Pounds/ Pounds/ Pounds/ Cost/ Cost/ Cost/ $/Harvest Lb $/Harvest Lb Acre Pond Lb. Fish Lb. Acre Pond @ $500/t Feed___@$400/t Feed(Note: Bold, straight print below is for in-pond raceway method. Italics print is for open-pond method.)Number of Raceways 0.5 3 --- --- --- --- --- ---Number of Raceways -0- --- --- --- --- --- --- ---Production level (Lbs) 30,000 180,000 --- --- --- --- --- --- Production level (Lbs) 8,000 48,000 --- --- --- --- --- ---Feed (@$500/ton) 36,000 216,000 1.2 (FCR) $0.25 $9,000 $54,000 $0.30 ---Feed (@$500/ton) 22,400 134,400 2.8 (FCR) $0.25 $5,600 $33,600 $0.70 ---Feed ($400/ton) 36,000 216,000 1.2 (FCR) $0.20 $7,200 $43,200 --- $0.24Feed ($400/ton) 22,400 134,400 2.8 (FCR) $0.20 $4,480 $26,880 --- $0.56 Fingerlings (pieces) 4,900 29,400 --- --- $3,822 $22,932 $0.08 $0.08Fingerlings (pieces) 8,000 48,000 --- --- $1,040 $6,240 $0.13 $0.13Harvesting and hauling 36,000 216,000 --- --- $1,080 $6,480 $0.03 $0.03Harvesting and hauling 8,000 48,000 --- --- $400 $2,400 $0.05 $0.05Electricity (Kwh) --- --- --- $0.09 $295 $3,540 $0.019 $0.019Electricity (Kwh) --- --- --- $0.09 $161 $960 $0.020 $0.020

In-Pond Raceways TOTAL: $0.43 $0.37 Open Pond TOTAL: $0.90 $0.76

$/Harvested Pound Difference:@ $500/ton, $0.47/Lb which represents a 52% variable cost savings.@ $400/ton, $0.39/Lb which represents a 51% variable cost savings.

Table 1Most Significant Variable Expenses

Pounds/ Pounds/ Pounds/ Cost/ Cost/ Cost/ $/Harvest Lb $/Harvest Lb Acre Pond Lb. Fish Lb. Acre Pond @ $500/t Feed___@$400/t Feed(Note: Bold, straight print below is for in-pond raceway method. Italics print is for open-pond method.)Number of Raceways 0.5 3 --- --- --- --- --- ---Number of Raceways -0- --- --- --- --- --- --- ---Production level (Lbs) 30,000 180,000 --- --- --- --- --- --- Production level (Lbs) 8,000 48,000 --- --- --- --- --- ---Feed (@$500/ton) 36,000 216,000 1.2 (FCR) $0.25 $9,000 $54,000 $0.30 ---Feed (@$500/ton) 22,400 134,400 2.8 (FCR) $0.25 $5,600 $33,600 $0.70 ---Feed ($400/ton) 36,000 216,000 1.2 (FCR) $0.20 $7,200 $43,200 --- $0.24Feed ($400/ton) 22,400 134,400 2.8 (FCR) $0.20 $4,480 $26,880 --- $0.56 Fingerlings (pieces) 4,900 29,400 --- --- $3,822 $22,932 $0.08 $0.08Fingerlings (pieces) 8,000 48,000 --- --- $1,040 $6,240 $0.13 $0.13Harvesting and hauling 36,000 216,000 --- --- $1,080 $6,480 $0.03 $0.03Harvesting and hauling 8,000 48,000 --- --- $400 $2,400 $0.05 $0.05Electricity (Kwh) --- --- --- $0.09 $295 $3,540 $0.019 $0.019Electricity (Kwh) --- --- --- $0.09 $161 $960 $0.020 $0.020

In-Pond Raceways TOTAL: $0.43 $0.37 Open Pond TOTAL: $0.90 $0.76

$/Harvested Pound Difference:@ $500/ton, $0.47/Lb which represents a 52% variable cost savings.@ $400/ton, $0.39/Lb which represents a 51% variable cost savings.

Table 2Return on Investment & Viability Total

Feed Cost Selling Est. Fixed* $/Harvest Lb Viability** ROI** $/ton Price____Cost @ $0.17/Lb_(Bottom Table 1)__________________

(Note: Bold print below is for in-pond raceway method. Italics print is for open-pond method.)Raceways 500 0.80 0.17 0.43 Yes <1 yr.Open-pond 500 0.80 0.17 0.90 No ------Raceways 500 0.90 0.17 0.43 Yes <1 yr. Open-pond 500 0.90 0.17 0.90 No ------Raceways 400 0.80 0.17 0.37 Yes <1 yr.Open-pond 400 0.80 0.17 0.76 No ------Raceways 400 0.90 0.17 0.37 Yes <1 yr.Open-pond 400 0.90 0.17 0.76 Marginal ------**Does NOT reflect approx. $6,300/acre income from pond fish (e.g. tilapia, paddlefish, etc.) in IPRS.*Examination of Dr. Carole Engle’s “Breakeven Costs of Catfish Production”, Univ. of Arkansas, P.B. supports this.

Table 2Return on Investment & Viability Total

Feed Cost Selling Est. Fixed* $/Harvest Lb Viability** ROI** $/ton Price____Cost @ $0.17/Lb_(Bottom Table 1)__________________

(Note: Bold print below is for in-pond raceway method. Italics print is for open-pond method.)Raceways 500 0.80 0.17 0.43 Yes <1 yr.Open-pond 500 0.80 0.17 0.90 No ------Raceways 500 0.90 0.17 0.43 Yes <1 yr. Open-pond 500 0.90 0.17 0.90 No ------Raceways 400 0.80 0.17 0.37 Yes <1 yr.Open-pond 400 0.80 0.17 0.76 No ------Raceways 400 0.90 0.17 0.37 Yes <1 yr.Open-pond 400 0.90 0.17 0.76 Marginal ------**Does NOT reflect approx. $6,300/acre income from pond fish (e.g. tilapia, paddlefish, etc.) in IPRS.*Examination of Dr. Carole Engle’s “Breakeven Costs of Catfish Production”, Univ. of Arkansas, P.B. supports this.

IPRS Projected Capital Expenses

(Assumptions Used for ROI Estimates)

IPRS Projected Capital Expenses

(Assumptions Used for ROI Estimates)A set of (3) 48,000 gal floating or

sit-on-bottom, HDPE, approx 1/8” $25,500

(Volume pricing available.)

Lumber for walkways, est. $2,700

(3) 3-Grid Airlifts w/frames, est. $3,000

(3) 1.5 hp. Blowers est.@ $800 = $2,400

(Estimated) TOTAL For 3: $33,600

(Est.) “Bonus Fish” Income/Pond $37,800

These public expenses and others can continue for a lifetime

A set of (3) 48,000 gal floating or sit-on-bottom, HDPE, approx 1/8” $25,500

(Volume pricing available.)

Lumber for walkways, est. $2,700

(3) 3-Grid Airlifts w/frames, est. $3,000

(3) 1.5 hp. Blowers est.@ $800 = $2,400

(Estimated) TOTAL For 3: $33,600

(Est.) “Bonus Fish” Income/Pond $37,800

These public expenses and others can continue for a lifetime