Aquacultural
Engineering
Volume
32, Issue 2 , January 2005, Pages 303-323
doi:10.1016/j.aquaeng.2004.07.001 
Copyright
© 2004 Elsevier B.V. All rights reserved.
The economic impact of proposed effluent treatment options for production of
trout Oncorhynchus mykiss in flow-through systems
Carole R. Englea,
, 
, Steeve Pomerleaua,
Gary Fornshellb,
Jeffrey M. Hinshawc,
Debra Sloand
and Skip Thompsone
aAquaculture/Fisheries Center, Mail
Slot 4912, University of Arkansas at Pine Bluff, 1200 North University Drive,
Pine Bluff, AR 71601, USA
bUniversity of Idaho
Extension, 246 3rd Ave E., Twin Falls, ID 83301, USA
cDepartment of Zoology, North Carolina State
University, 455 Research Drive, Fletcher, NC 28732, USA
dNorth Carolina Department of Agriculture and Consumer
Services, P.O. Box 1475, Franklin, NC 28744, USA
eNorth Carolina Cooperative Extension, P.O. Box 308,
Waynesville, NC 28786, USA
Received 20 April 2004; accepted 13
July 2004. Available online 20 August 2004.
Abstract
The United States Environmental Protection Agency has considered several
treatment options for flow-through systems in its Effluent Limitation Guidelines
rulemaking effort on aquaculture. However, the economic effects of treating
effluents can impose high costs on aquaculture businesses, depending upon the
treatment option selected. Survey data from trout farmers in North Carolina and
Idaho were used to develop enterprise budgets, a spreadsheet-based risk
analysis, and mathematical programming models of medium-sized trout farms in
North Carolina (68,182 kg/yr) and Idaho (90,909 kg/yr) and large trout
farms in Idaho (1,136,364 kg/yr). These analyses were used to examine the
effect of imposing five different effluent treatment options on the net returns
of farms raising trout in raceways. Budget analyses showed that the trout farm
scenarios considered were generally profitable, although the medium-sized farms
exhibited low levels of profitability. All five proposed effluent treatment
options resulted in negative net returns for the medium-sized farms in both
North Carolina and Idaho. The large farm scenario showed positive net returns
after adding costs associated with the affluent treatment options considered,
but the risk of generating positive net returns decreased from 82–84% to 10–11%.
Thus, financial risk increased considerably when treatment options were imposed.
The mixed-integer mathematical programming model demonstrated sensitivities to
the level of credit reserves both for operating and investment capital. The
effluent treatment options imposed on the models were not economically feasible
at the levels of capital available on most trout farms. Subsequent runs of the
model used investment capital requirements of treatment options at 50% of the
original estimates. The models showed that imposing effluent treatment options
forced farms to substitute production units for treatment facilities. This
results from a combination of: 1) the additional capital requirements of the
treatment options; 2) limited availability of credit reserves; and 3) competing
uses for land in trout farming areas that put upward pressure on land prices.
Many of the proposed treatment options included substantial investment capital
requirements that increased annual fixed costs. Limited availability of
investment capital prevented the farm expansion that would be needed to spread
the increased fixed costs; hence, the models were forced to remove units from
production to meet treatment constraints. Net returns decreased because farms
were forced to operate at inefficient levels.
Keywords: Trout; Economics; Effluents
Corresponding author.
Tel.: +1 870 575 8523; fax: +1 870 575 4637.
