This document discusses using financial calculations to inform fisheries management decisions in Thai trawl fisheries. It presents data on costs, earnings, and internal rates of return for 14-18m otter trawlers. Sensitivity analysis shows the IRR is most sensitive to changes in fuel price, trash fish price, and number of fishing days. Two scenarios are analyzed that increase prices and reduce fishing days, resulting in a higher IRR of 11.85%. Management questions are raised about reducing fishing effort by having fewer fishing days per vessel and paying processors to increase prices, which could reduce bycatch by nearly 3,000 tonnes annually across 1,500 boats.
2. Background
• Study done in 2004 on the Thai trawl fisheries
– Tokrisna.R., Kaoian.S. ,Kraimark.T.,
• Financial performance of
– Otter trawls, Pair trawls, Beam Trawls, Push Net
– <14 m , 14 -18 m, >18 – 25 m, >25 m
• Range chosen 14-18 M otter trawler
• Social aspects
– Fishing frequency, fisherman debt, attitudes , non
Thai workers, leaving fishing, assistance required,
secondary and non fishing occupations etc…
3. Why is it important to do these studies
Cost and benefit
analysis
Cost and earnings of
product value chain
dependency
relationship
Where is the elasticity
for shifting benefits
Financial costs and
benefits of fishery
management measures
and scenarios
Presentation of win –
win financial scenarios
to fishers, traders,
processors
Negotiations between
fishers, traders,
government on fair, just
& appropriate transfers
4. Methodology
• Use the original figures
• Calculate Internal Rate of Return (IRR)
IRR = TOTAL INCOME – FIXED COSTS + VARIABLE COST
INVESTMENT COSTS
• Prepare a sensitivity analysis
• Important to collect the data
• Some data missing from the study
5. General Information
VESSEL SPECIFICATIONS
VESSEL NAME
LX B X D (M) 14-18 m
ENGINE MAKE
ENGINE HP 240
TURBO OR NATURAL NATURAL
CONSTRUCTION MATERIAL (STEEL/WOOD/FRP) WOOD
YEAR CONSTRUCTED-AGE 1985 - 19
REGISTRATION /LICENSE No.
NUMBER OF CREW 8
GENERATOR HP 90
FUEL TANK CAPACITY LITERS
WATER TANK CAPACITY LITERS 5,000
DAYS FISHING PER YEAR 207
HOURS FISHING PER DAY 18
HOURS FREE RUNNING PER DAY 6
EXCHANGE RATE LOCAL CURRENCY TO USD 39
COST OF FUEL PER LITER 12.62 Baht / 0.32 USD
7. Yearly Fixed Costs
USD Baht
FIXED COSTS YEARLY 5,785 225620.60
DEPRECIATION HULL – 19 years 2,029 79140.00
DEPRECIATION ENGINE – 10 Years 0 0
DEPRECIATION TRUCK – 10 Years 0 0
DEPRECIATION ELECTRONICS – 4 Years 0 0
SALARIES 0 0
AGENT FEES, TRANSPORT AND OTHER FEES 2,385 93000.00
INTEREST PAYMENTS repayment of Loans 1,371 53480.60
DOCK FEE MONTHLY X 12 0 0
INSURANCE FOR HULL AND MACHINERY 5% OF
INVESTMENT 0 0
INSURANCE FOR WORKERS X No OF CREW 0 0
MONTHLY SOCIAL SECURITY X No OF CREW X 12 0 0
RENT/MONTH X 12 (500*12) 0 0
VEHICLE INSURANCE 0 0
8. Yearly Variable Costa
USD Baht
VARIABLE COSTS 54,922.62 2141982.00
ELECTRICITY (MONTHLY BILL X 12) 0 0
ANNUAL WATER 540 21060.00
TAXES (PROFIT x CORPORATE TAX RATE) 0 0
FOOD 3,831 149400.00
FUEL FOR VESSEL (Daily fuel consumption x fishing days
per year) 22,897 892989.00
OTHER COSTS
FAMILY LABOUR 1,201 46848.00
LUB OIL 930 36288.00
CREW SHARE % OF CATCH 9,385 366000.00
ICE = 80 % OF WEIGHT OF FISH 3,209 125145.00
MAINTENANCE 12,930 504252.00
SHIP SPARES (Paints, greases, bulbs, ropes, chains, trawls) 0 0
ENGINE SPARES (Filters, belts, seals, impellers, ) 0 0
VMS PINGS 0 0
REPLACEMENT OF GEAR 0 0
ANNUAL VEHICLE MAINTENANCE /COST PER MONTH 0 0
DRY DOCK AND HULLMAINTENANCE 0 0
PACKAGE AND OTHER COSTS 0 0
9. Income Calculation
SPECIES CHARACTERISTICS
YEARLY
INCOME
CPUE = KGS PER
DAY
SALE
PRICE/KG
DAILY
VALUE
DAYS PER
YEAR
SHRIMP 917469 42 105 4432 207
SMALL FIN FISH 0 0 207
MEDIUM FIN FISH 0 0 207
LARGE FIN FISH 0 0 207
SMALL CRAB 0 0 207
MEDIUM CRAB 0 0 207
LARGE CRAB 0 0 207
SMALL SHELL FISH 0 0 207
MEDIUM SHELL FISH 0 0 207
LARGE SHELL FISH 0 0 207
SMALL OTHER 0 0 207
MEDIUM OTHER 0 0 207
LARGE OTHER 0 0 207
TRASH FISH CLEAN GOOD QUALITY 308394 389 3.83 1490 207
FOOD FISH 344187 54 31 1663 207
SQUID 658530 60 53 3181 207
SWIMMING CRAB 262710 153 8 1269 207
VERIFYDAILY VALUE WITH WHAT
OWNER SAYS 2 491 290 12 035
10. IRR Calculation
USD Baht
TOTAL FIXED AND VARIABLE
COSTS 60,708 2,367,602
INCOME 63,879 2,491,290
PROFIT 3,171 123,687
IRR 11.16% 11.16%
14. Management questions to be
answered
• Reduce the number of fishing days from 207 –
186 = reduce 20 days per year per vessel.
• Reduction 97 Kgs. / fishing day x 20 days/
year = 1.945 tons per boat /year
• Assuming 1500 boats = reduction of 2918
tonnes of bycatch reduced per year.
15. Reality Check
• Who will pay the additional cost for the trash fish,
shrimp, food fish and squid? Public? Processor,
government through price support
• Remember Governments are already paying
billions in subsidies (Why not get something back)
• Who’s talking about this?
• How will it be monitored – All vessels will stay in
port and report to the harbor master. Easy to
monitor. No vessels leave port without permission.