A strong domestic market absorbs most of its production but for export markets, industry needs to be cost efficient and competitive
By Guruh Arifianto
The tilapia is very special to Indonesia, both as a commodity and a popular food fish domestically. Tilapia is farmed in various water bodies, such as lakes at the edge of volcanic mountains, raceways, freshwater and brackishwater earthen ponds, floating net cages, irrigation canals and rice fields.
From 2011 to 2019, tilapia production in Indonesia was on the rise at a CAGR of 11.9% (GOAL, 2021). In 2017, production was 1.3 million tonnes but this dropped to 1.2 million tonnes in 2018. In 2020, affected by the Covid-19 pandemic, production went down to 1.2 million tonnes from 1.3 million tonnes in 2019 (Figure 1). Farmers suffered as demand dropped by 11%. Some 30-35% of this volume came from farming activities. Based on feed usage, nearly 400,000 tonnes were from intensive culture systems.
In 2021, production remained relatively stagnant due to lower cage culture activities, declining supply of fry and fingerlings, disease outbreaks and environmental issues. Climatic factors included floods and upwellings in lakes. Since demand has been slow to increase, there was a high supply situation. However, there were regional differences with regards to recovery in demand.
In 2022, tilapia production is expected to improve. However, new problems have emerged, due to the extraordinary increase in feed prices: the global rise in costs of some major feed ingredients. Thus, farmers encounter the problem of reaching production cost efficiency. In the first half of 2022, we expect that there will be a slight decline in production, as evidenced by the increase in fish prices in the domestic market. It has been reported that in several areas, small farmers have ceased farming due to rising production costs, mainly due to high feed prices.
Less production in 2021
In general, farming activity was on the decline. Several reservoirs and lakes are part of the government’s ban/ restrict floating net cage (Kebijakan Jaring Apung or KJA) policy. Initiated in 2018, the plan is to reduce cage culture in lakes, in favour of tourism-linked activities. Farming activities were disrupted in several major man-made and natural lakes, where tilapia culture predominates, such as Lake Toba and Lake Batur and reservoirs such as Jatigede, Cirata and Jatiluhur. If for each cage of 3mx3mx2m, the production capacity is one tonne of fish, then with 1,000 cages, the potential drop in production can be 250-300 tonnes/month.
Another factor influencing production was the allocation of land for rice versus earthen ponds for tilapia culture. Added to the above was the decrease in environmental carrying capacity, diseases and environmental disasters. Separately or together, disease and environmental factors have led to decreases in growth performance and survival rates from 70% to less than 40%. Over the last 15 years, declines in productivity were most evident in traditional earthen ponds, with drops of 50-100%, where the biomass has decreased from 2kg/m3 to 1.0-0.5kg/m3. Some other culture ponds also had the same challenging conditions.
The total demand for tilapia fry is 250 million fry/month from one million broodstock. However seasonal supply fluctuations mean that supply often does not match demand. Furthermore, fry quality is very diverse, affecting grow-out production due to environmental challenges and limited availability of quality broodstock. An adequate fry supply in terms of quality and quantity is necessary to ensure production continuity. There are indications of a decline in production linked to the environment and diseases because the current fry available are generally not adapted to environmental changes and are susceptible to diseases. There has been a decline in growth performance, feed conversion ratio (FCR) and survival resulting in rising production costs (Arifianto, 2022).
Large domestic market
Most of the tilapia (almost 99%) are sold in domestic markets and only 0.5-1.5% of national production are exported. Prices in domestic markets are much higher than in export markets. Locally prices fluctuate and show regional disparities. Harvest sizes for local markets are much smaller than for export (200g to 500g) and therefore farmers have more crops per year. The local market demands fresh fish, but the pandemic years have spawned more creative value-added tilapia products for local retail markets.
Disease challenges
Over the last 10 years, tilapia has been extremely susceptible to diseases (Figure 2), with infectious Aeromonas bacteria occurring at the hatchery and nursery phases and later at grow-out with Streptococcus when fish are 10g to 1kg in size. Bacterial diseases cause mass mortality or lower survival rate to only 30%. Susceptibility to parasites and fungi is encountered at the hatchery and nursery stages at 2-3cm fry stages. Environmental challenges include low dissolved oxygen, temperature and pH throughout the culture cycle leading to less than 40% survival rates from an average of 70%. High salinity can pose a problem at the nursery and grow-out stages.
Cost of production
Several factors contribute to rising production costs. Diseases and environmental conditions lowered survival rates. Poor fry and juvenile quality lowered growth performance. Feed and energy costs have been increasing. In Indonesia, the cost of production in 2022 based on an assumption of FCR of 1.5 for 500-800g fish and survival of 50% was IDR16,000-18,000/kg (USD1.11-1.23/kg).
There is a wide range of specifications for tilapia feeds in Indonesia and prices vary with % crude protein and brands. In 2022, prices for feeds rose 15 -20%.
Prices in local markets in 2022 ranged from IDR23,500/kg to 26,000/kg (USD1.56-1.73/kg. As a comparison, in 2020, wholesale prices for live tilapia in China were between CNY7.5-8 (USD1.09-1.16/kg) for 500-800g (DAP, Hainan). According to Globefish, in 2021, prices remained steady throughout the year. This higher cost of production for tilapia in Indonesia makes it uncompetitive for export markets which will also require some processing. Catering to the domestic market is more attractive for farmers.
Strategies to increase volumes and production efficiency
There are various ways for farmers to increase efficiency to secure higher incomes from tilapia farming. This is by reduction in costs of production and improvement in productivity.
Polyculture systems
Tilapia can survive well at 20ppt salinity and in symbiosis with other fish or shrimp. Polyculture is possible in various ways: vannamei shrimp with tilapia in ponds; tilapia and carps in raceways and tilapia and pompano in cages. The other fish or shrimp in the polyculture system is a buffer when tilapia prices drop. In Figure 3 and Table 1, we explain the different methods of polyculture of tilapia with vannamei shrimp. There are three methods to design polyculture of tilapia with vannamei.
In a mixed model, there is stocking of both the tilapia and vannamei shrimp at an equal density of 5-15 pcs/m2 or unequal with 15:45 (vannamei: tilapia) pcs/m2. In a mixed model, one tonne of vannamei can be produced. In the couple model, water from the tilapia ponds flows into the vannamei shrimp ponds and helps to control Vibrio spp. populations.
Biofloc systems
These can reduce the use of feeds and increase productivity. Reductions in FCR by 0.1-0.2 points will save feed costs by IDR800-2,000/kg (USD0.5-0.13/kg) while productivity increases to 20-30kg/m2. However, few farmers have adopted biofloc systems which require more energy and technical inputs.
Intensive culture
In Jogjakarta and East Java, intensive culture of tilapia is common. Small ponds use paddle wheels and stock 10-15g juveniles (50-55/m3). Survival is around 70-80%. The productivity is 8kg/m3 of 200g fish after 120-140 days which is a problem if the target is the export market. FCR is 1.3-1.4 and cost of production ranges from IDR16,000 to 17,000/kg (USD1.06-1.13/kg). Cost of energy ranges from IDR500-1,000/kg (USD0.03-0.06/kg).
IPRS
A more recent technology is the In-Pond Raceway System (IPRS) introduced by USSEC and GPMT. The aim here is to increase productivity (30 tonnes/cell or more than 125kg/m3) and act as an alternative to cage culture and traditional raceways.
Export potential
The global market for the tilapia comprises 154 importing countries but Indonesia exports to only 16 countries. In an article “Marine Economic Literacy”, Suhana (2021) discussed the export performance of tilapia. Tilapia is a target export commodity from Indonesia and is included in the top 10 Indonesian fisheries exports. Data from the Central Bureau of Statistics (Badan Pusat Statistik or BPS, 2021) showed that the export of tilapia in the last three years has increased and even during the Covid-19 pandemic, the export value of tilapia increased by 17.13%. The export volume of tilapia in 2020 reached 12,290 tonnes with an export value of USD78.4 million. This was still only 1% of the production potential. BPS (2021) documented those exports came from production in five provinces led by North Sumatra with 91.7% and Central Jawa at 8.3%. Exports were mainly to markets in the US, Canada, Taiwan, Netherlands, South Korea and Japan. Lake Toba in North Sumatra contributed 91.6% of total exports of tilapia, valued at USD 71.9 million in 2020.
Increasing competitiveness
The current situation with rising production costs affects its competitiveness in global markets. The Directorate of Aquaculture, Ministry of Fisheries and Marine Affairs has developed more than 20 strains of tilapia in Indonesia for fast growth, low FCR and high fecundity and the first step is to identify and characterise these strains to match changing environmental conditions and develop disease resistance.
Indonesia needs to produce premium quality tilapia. However, the constraints are not only high mineral content of volcanic water bodies but as in the case of Lake Toba, the rivalry between aquaculture and tourism. Export markets demand large sized tilapia of 800-1,000g fish. Therefore, the challenge will be for farmers to move away from producing small sized tilapia, despite high costs of energy. To maintain production of small sized tilapia (<500g) requires creativity in value adding.
Table 1. Tilapia/vannamei shrimp polyculture models for increasing productivity and water quality improvements.
Notes: This article was adapted and updated from a presentation on Status & Current Issues: Development of tilapia culture in Indonesia, presented at the International Conference of Aquaculture Indonesia 2021 (ICAI), October 28 30, 2021, Semarang, Indonesia.
References:
Asian-agribiz, 2022. Indonesian tilapia farmers suffer losses on high feed price. GOAL 2021. Global Finfish Aquaculture Production Survey and Forecast. Presented by the Global Seafood Alliance and Rabobank at GOAL 2021, November 2021.
Globefish, 2021. Tilapia sector growth to resume after shaking off pandemic effects. www.fao.org/in-action/globefish/market-reports/resource-detail/en/c/1416636/
Guruh Arifianto, 2022. Strategy to develop tilapia aquaculture in terms of quantity and quality of seed supply. Presented at Aquabinar Series-17, Trobos, Indonesia.
Guruh Arifianto is responsible for technical support and fish hatchery at PT Sinta Prima Feedmill. Email: guruharifianto29@yahoo.co.id
This article was published in issue July/August 2022 AQUA Culture Asia Pacific, pp47-50. View & Download pdf
