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With A.J. O'sullivan the ECONOMIC & SOCIAL RESEARCH INSTITUTE

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With A.J. O'sullivan the ECONOMIC & SOCIAL RESEARCH INSTITUTE General Research Series PAPER NO. 156 MAY, 1992 Robert O’Connor Brendan J. Whelan James A. Crutchfield with A.J. O’Sullivan THE ECONOMIC & SOCIAL RESEARCH INSTITUTE THE ECONOMIC AND SOCIAL RESEARCH INSTITUTE COUNCIL *TOMAS F. 0 COFAIGH, President of the h*stitute. *EUGENE McCARTHY, Chai~wlan of the Council. KE",qN BONNER, Seeretary, Department of l_abour. VANI K. BOROOAH, ProfessoT, DepaT~tnumt of Applied Economics and Human Resource Management, University of Ols~" atJordanstown. JAMES CA~A~EY, Senior Paffner, Cawley Sheerin Wynne. L1AM CONNELLAN, Director General, Confederation of lrish Industry. *SEAN CROMIEN, Seottary, Department of Finance. *MARGARET DOWNES, Director, Bank of lreland. *MAURICE F. DOYLE, Governor, Central Bank of h’eland. DERMOT EGAN, Deputy Chief Executive, AIB Group. *CONNELL F,,MNNING, Professor, Department of Economics, University College, Cork. P.W. FLANAG,’MN, former Secretary, Department of Health. GRAHAM GUDGIN, Directm, Not~thern b’eland Economic Research Centre. JOSEPH HARFORD, Chief Executive, Vamanouchi h’eland Company Limited. *KIERAN A. KENNEDY, Director of the Institute. PATRICK LYNCH, Chair~nan of the Institute, 1983-1988. DONAL MURPH’I; Director, Central Statistics Office. *DERA4OT McALEESE, Whately Professor of Economics, Trinity College, Dt~blin. EDWARD F. McCUMISKEY, Secretary, Department of Social Welfare. FERGUS McGOVERN, Chief Executive, Telecom Eireann. JOHNJ. McKAY, Cheif Executive Officer, Co. Cavan Vocational Education Committee. *DONAL NEV[N, forraer General Secretary, Irish Congress of Trade UnioT~s. JOYCE O’CONNOR, Director, The National College of hldustrial Relations. MAURICE O’GRADY, Director Genial, Irish Management Institute, PATRICK O’ REI LLY, Chief Executive, EBS Building Society. *W.G.H. QUIGLEY, Chairman, Ulster Bank Limited. PIERCE R~t~N, Director, Teagasc. *NOEL SHEEHY, Professor, Departmm~t o f P~ychology, University College, Dublin. SEPuMUS SHEEHY, Professor; DepaT¢,~nt of Applied Ag~mtltural Economics, University College, Dublin. M ICHAELJ. SOMERS, Director, National Debt Management Agency, Department of bTnance. REV. CONOR K. WARD, Social Science Research Centre, University College, Dublin. *T.K. ’d,q-IITAKER, President of the h~stitute, 1971-198Z *PADRAIC A. ’d,q’tlTE, Director, Dresdner International Finance, pie. * Members of Executive Commiuee REVIEW OF THE IRISH AQUACULTURE SECTOR AND RECOMMENDATIONS FOR ITS DEVELOPMENT Copies of this paper may be obtained fiom "/’he Economic and Social Red, catch hastitute (Limited Comptlny No. 18269). Registered Office: 4 Burlington Road, Lhtblin 4. Price IR£ 15.00 (Spedat rate for students IR£ 7.50) Professor R. O’Connor is a Consultaqt,with The Economic and Social Research Institute. Professor B.J. Whelan is Head of the Survey Unit at the ESRI and Professor J. A. Crutchfield is a Consultant with National Resource Consultants Inc., Seattle, Washington, USA. Dr. A.J. O’Sullivan is a director of a private consultancy firm, Environmental Management Services Limited. The paper has been accepted for publication by the Institute, which is not responsible for either the content or the views expressed therein. "RE’VIEW OF THE IRISH A QUA CULTURE SECTOR AND RECOMMENDATIONS FOR ITS DEVELOPMENT Robert O’Connor Brendan J. Whelan James A. Crutchfield with A.J. O’Sullivan © THE ECONOMIC AND SOCIAL RESEARCH INSTITUTE DUBLIN 1992 ISBN 0 7070 0129 3 iii A cknowledgement~ The authors wish to acknowledge the assistance received from a number of people in the preparation of this report. Special thanks for supplying data, references and advice are due to Mr Pat Keogh, Ms Majella Fitzsimons, Mr Alec White, Mr Dick Bates, Mr Michael Doorley and Dr John Kennedy of BIM, and to Mr John Bennett and Mr Michael Corduff of Udaras na Gaeltachta. Others who made valuable comments and suggestions were: Dr John Joyce of The Irish Salmon Growers’ Association, Dr K. 17. Whelan, The Salmon Research Agency, Dr Tom Cross, University College Cork, Ms Sara White, Department of the Marine, Mr Shay Garvey and Mr Miceal O Cinneide of the Irish Salmon Producers’ Group, Mr Declan Ashe, Mr Michael Quinn, Mr Brian Wall, Mr Tim Smith and Ms Maoiliosa Ottway of the Irish Shellfish Producers’ Association. We are greatly indebted also to the Aquaculture Producers who took time off to talk to us about production and marketing problems. Included in this group are Mr Damien Fi~maurice of Lett and Co. Ltd., Mr Fergal Dempsey of Bradan Mara, Mr Seamus McQuaid, Carlingford Lough Aqnacuhure Association, Mr larflaith Connellan, Redbank Shellfish, Mr A. J. Fox, Fanad Fisheries and Mr John Slater, Deenagh Point Shellfish. People in companies supplying aquaculttwe who took time to talk to us were Mr O. McConn, Steelform, Oranmore, Miss G. O’Mahoney, B. P. Nutrition, Westport, and Mr Terry Nolan of Wavemaster Cages. We are also deeply gratefitl to the salmon, trout and shellfish farmers who co-operated in the survey and provided ~’aluable information on the structure of the aquaculture industry. Special thanks are due to Mr Declan Doyle of the Department of the Marine, and Dr Brian Keary of the University of Limerick who helped in the preparation of Appendix B dealing with aquaculture licences. Our thanks are also due to Dr Eoin O’Malley and Dr Rory O’Donnell of The Economic and Social Research Institute who read earlier drafts of the report and made valuable suggestions. The attthors are, of course, responsible for any errors, omissions or obscurities in the final draft. iv COAVI’EAVI’S Page Acknowledgements iv Glossary xii General Summary 1 Introduction 10 Chapter 1 Aquaculture - An Overview ll 2 The Salmon and Trout Farming Industries 23 3 The Salmon Market 45 4 Shellfish Farming 79 5 The Market for Shellfish 95 6 Survey of the Aquacuhure Industry 119 7 Aquaculture and the Environment 155 8 Conclusions and Recommendations 203 Referenc~ 221 Appendices A Aquacuhure Education and Training Courses 237 B Licence Requirements for Aquacuhure 238 C EC Regulations 251 V Page D Environmental Effects: Technical Aspects 256 E Tables Showing Other Problems and Opinions ofFish Farmers 265 F Questionnaire used in Aquaculture Survey 269 List of Tables "Fable 1.1 Farmed Fish Production in the European Community Member Countries in 1989 15 1.2 Irish Aquaculture Production by Species 1980 and 1990 17 1.3 Capital Grants Paid by the State and the EC, and Sales of Finfish and Shellfish 1980-1990 19 2.1 Total Wild Salmon Landings by Species 1980-1989 24 2.2 Annual Production of Farmed Atlantic Sahnon by Country 1981-1990 With Forecasts for 1995 27 2.3 Annual Production of Farmed Pacific Salmon by Country and Species 1981-1990 With Forecasts for 1995 29 2.4 Annual Production of All Farmed Sahnon by Country 1981-1990 With Forecasts for 1995 30 2.5 Annual Production of Farmed Trout in Different Countries 1980-1989 and Forecasts for 1992 (Sea and Inland Production) 43 3.1 Per Capita Consumption of Atlantic Salmon in 12 Countries in 1980, 1985 and 1989 (Round Weights) 47 3.2 Trade in Fresh and Frozen Atlantic Salmon in EC Countries in 1990 51 vi 7~b& Page 3.3 Growth in Demand for Atlantic Salmon 1985-1995 (’000 tonnes round weight) 71 3.4 Growth in Demand for Atlantic Salmon by Major Product Category ~1: ",~Jr. 71 3.5 Demand/Supply Balance for Atlantic Salmon 1989-1995 72 3.6 Atlantic Salmon Prices 1980-1989 (UK£/kg round weight 2-4 kg) 73 3.7 World Production of Adantic Salmon and Average Wholesale Real Prices 1980-1989 76 3.8 Forecast of Salmon Prices in the 1990s (Irish £ per tonne in Real Terms for 2-4 kg fish - CIF Boulogne, Base Year 1990) 77 4.1 Production of Cultivated Mussels in Ireland 1980-1990 84 4.2 Production of Cuhivated Oysters in Ireland 1980-1990 88 4.3 Cash Flow Budget for 50 tonnes of Clams per annum 91 5.1 Consumption of Molluscs in EC Counries 1989 95 5.2 Trade in Fresh and Chilled Mussels in EC Countries in 1989 98 5.3 Trade in Frozen Mussels in EC Countries in 1989 99 5.4 Trade in Oysters in EC Countries in 1989 106 6.1 Date of Commencement of Salmon and Trout Production 121 6.2 Annual Sales of Farmed Salmon and Trout 1985-1990 on Farms in Operation in 1991 121 6.3 Number and Capacity of Salmon and Sea Trout Cages 122 6.4 Current Value of Structures and Other Fixed Capital on Salmon and Trout Farms 122 vii "Fable Page 6.5 Sources of Investment in Salmon and Trout Farms 123 6.6 Destination of Farmed Salmon and Trout Sales in 1990 124 6.7 Quantity of Salmon and Trout Stocks at the End of 1989 and 1990 and Value of Stock Changes 124 6.8 Labour Force Employed in Salmon and Trout Farming in 1990 and Number of Person Years Worked 125 6.9 Educational and Technical Qualifications of the Labour Force Employed in Salmon and Trout Farming 126 6.10 Problems Encountered by Salmon and Trout Farmers 127 6.11 Financial Results on Salmon and Trout Farms in 1990 128 6.12 Individual Expenses as Percentage of Total Expenses on Salmon and Trout Farms 129 6.13 Unit Production Costs and Other Features on Different Groups of Irish and Scottish Salmon Farms 131 6.14 Proposed Investment in Fixed Capital and Sales on Salmon and Trout Farms 1991-1993 133 6.15 Number of Sites or Locations of Shellfish Farms 135 6.16 Date of Commencement of Shellfish Production 136 6.17 Current Value of Structures and Other Fixed Capital on Shellfish Farms 137 6.18 Sources of Investment, Government Loans, etc., for Shellfish Farms 137 6.19 Annual Sales of Farmed Shellfish 1985-1990 (IR£’000) 138 6.20 Destination of Farmed Shellfish Sales in 1990 (tonnes) 138 6.21 Value of Farmed Shellfish Stocks 1989 and 1990 139 viii "Fable
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