1 A PRELIMINARY EVALUATION OF ADOPTION AND IMPLEMENTATION OF BETTER MANAGEMENT PRACTICES IN THE CATFISH FARMING INDUSTRY IN THE MEKONG DELTA, VIETNAM CARD Project 001/07/VIE August 2010 1. Background Aquaculture is a rapidly expanding global industry, which has the potential to improve the livelihoods of many people in the developing world. Aquaculture may provide a means of income to the rural poor and support the availability of an affordable protein source, and contribute to food security. To achieve this potential, significant improvements must be made in current production systems, particularly from an environmental and resource usage view points. Despite evidence of profitability in many sectors, some systems are still performing sub-optimally and/or causing negative impacts on the social and environmental landscape. There is a pressing need for the aquaculture industry as a whole to become ecologically sustainable to realize its full potential and be viable well into the future. 1.1. Sustainable Aquaculture and Better Management Practices The concept of ecologically sustainable development (ESD) is complex. The multidisciplinary nature of ESD, including social, environmental and economic dimensions, must be acknowledged at the planning stage of new and emerging industries in order to facilitate enduring and optimal performance. Such factors make creating ESD-based industry development a complex process that must consider the needs of all stakeholders. Better Management Practices (BMPs) have been proposed as one method to address sustainability issues in aquaculture. BMPs are a set of management guidelines, which are relatively easy to achieve without substantial increases in costs. They are designed to standardize and optimize ‘through chain’ industry management practices within the constraints of the existing system. They facilitate the means for continuous improvement in producers to meet market needs and expectations around product quantity and quality, and provide a framework for addressing ESD at an industry scale. To do this, BMPs must be context specific, subject to the geo-political region, industry sector and species of interest, socio-economic circumstances of key stakeholders and the needs and expectations of the post-harvest sector, including processors and consumers. 2 1.2. Catfish Farming in the Mekong Delta, Vietnam BMPs are presently being developed within the catfish-farming sector located in the Mekong Delta of southern Vietnam. This sector has seen rapid expansion over the last decade, with current production in excess of one million tones per annum, worth over US$1 billion in export value. Such expansion has highlighted a number of social and environmental issues, which challenge the long-term sustainability of the industry. The widespread adoption of BMPs is seen as a key strategy to secure a sustainable future. A project funded by the AusAID Capacity for Rural Development (CARD) program, designed to facilitate the development and implementation of BMPs in the catfish farming industry in the Mekong Delta, is presently in progress. This project is lead by the Victorian Department of Primary industries (Fisheries Victoria) in collaboration with the Network of Aquaculture Centres in Asia- Pacific (NACA), Research Institute for Aquaculture #2 (RIA2), Vietnam, and Can Tho University, Vietnam. The CARD project is based in four provinces of the Mekong Delta, South Vietnam, and is primarily targeting the role of smallholders at the production end of the market chain (i.e. hatchery, nursery and grow out stages). It is expected that BMPs will provide more security for smallholder farmers, particularly where such farmers organize themselves into cooperative associations (also referred to as ‘aqua clubs’). The project has a requirement to evaluate the impact of BMPs under pilot, farm- scale demonstration conditions, including the role of farmer associations in facilitating effective BMP adoption and implementation. To date, draft BMPs have been developed and are being demonstrated as part of formal trials by a selection of farmers and farmer associations for a full (six month) production cycle commencing in early 2010 (see Appendix 1). 1.3. Social and environmental impacts Several studies have documented the social and environmental issues facing the industry (Phuong & Oanh, 2010; Bush et al., 2009). Some examples include depleting wild fish stocks used for feed, a lack of effluent management and the unregulated use of chemicals. While these broad issues have been discussed, few studies have assessed the effectiveness of particular management strategies in addressing these issues. Further, Phan et al. (2009) also found there was a lack of guidelines surrounding farm management, and little communication between neighboring farmers on environmental issues. Consequently, there is a pressing need for research to explore whether specific management strategies such as BMPs address key social and environmental issues and improve farm management performance. The draft BMPs developed by the CARD project cover a number of farming activities and associated economic, social and environmental issues relevant to 3 the long term sustainability of the industry (AusAID (CARD) 2009). In summary these include: • Addressing key market issues: ensuring small scale producers have a stronger standing in the industry as well as helping producers meet increasingly stringent food safety and production standards. • Addressing environmental concerns at the farm level, such as minimizing the risk of disease, efficient water exchange rates and appropriate stocking density. • The BMPs will also address social issues relating to community expectations, including the likely role of farmer associations (also referred to as ‘aqua clubs’). 2. The Present Study The present study comprises a discrete component of the larger CARD Catfish BMP project, and contributes to the broader CARD project evaluation, with specific emphasis on environmental and social impacts of the BMP demonstration trials as determined primarily by participating farmers. The present study examines whether smallholder catfish farmers believe BMPs can address key social and environmental issues on their farms in the Mekong Delta, South Vietnam. In this sense, the study contributes new knowledge at the local, farmer level, with specific emphasis on impacts of BMPs on the social and environmental issues facing the industry. With this knowledge, the study will guide future BMP extension strategies and help in the planning of government policies and industry (including farmer and NGO-based) support programs. For the purposes of this study, the focus was on smallholder rural farmers at the production end of the market chain (hatchery, nursery and grow out). They are the key drivers of the intensive, pond-based production system for which BMPs are expected to provide tangible benefits. These farms are typically family owned and operated (also referred to as ‘household scale’). Recently, some of these farms have been taken over by larger farmers and/or processors (as part of expansion of ‘industrial scale’ farming) due to market pressures, such as increasing cost of inputs and declining fish price, and other farms have simply closed down for economic reasons. 2.1. Objectives The overall aim of the present study is to undertakes a preliminary evaluation of the BMP demonstration trials as part of the CARD project. The purpose is to contribute valuable new knowledge which will facilitate a viable future for the smallholder farmers in the catfish aquaculture industry, as they are integral to the future viability and sustainability of the industry as a whole. Specifically, three key objectives are addressed: 4 1. To identify key social and environmental issues relevant to demonstration of BMPs 2. To examine the reactions of farmers to the BMP demonstration trials in light of these issues, and 3. To assess the role of farmer associations (aqua clubs) in facilitating the adoption and implementation of BMPs at an industry-wide scale. 2.2. Materials and Methods The study undertakes a two-step approach: • Firstly, the study analyses and reviews existing data on socio-economic and environmental issues, industry problems and farmer attitudes to BMPs generated by the CARD baseline survey (Phan et al., 2009). This survey involved structured interviews with representative farmers in all four catfish producing regions; An Giang, Dong Thap, Can Tho, and Vinh Long. Farms were randomly selected from a list provided by respective administrations and involved farmers planning to be involved in the BMP project as well as farmers not involved in the project (Phan et al., 2009). Responses to the key questions from the structured interviews relevant to objectives of the present evaluation study were summarized and reviewed to generate preliminary understanding of social and environmental issues at the stage prior to the implementation of the CARD Catfish BMP project. This activity is particularly directed to answering the first research objective of the present study. • A second, fieldwork component of the present study addresses objectives two and three, and focuses on the CARD Project implementation of the BMP demonstration trials. This work was conducted from the 13 TH June to the 30 th June 2010. It involved surveys of catfish farmers involved in the BMP demonstration trials primarily from two (Can Tho and An Giang) of the four major catfish farming provinces in the Mekong Delta, but also included surveys of other BMP farmers and some non BMP farmers in the other major provinces of the Delta. The fieldwork component used a semi structured approach, involving use of standardized questionnaires (see Attachment 2) to conduct in-depth interviews with participants at their farms. The semi-structured approach was chosen as it describes and measure impacts of BMPs and associated attitudes of farmers in a way that allows scope for farmers to express in their own words their concerns, ideas and aspirations surrounding BMPs and the industry’s longer term sustainability. The interview questions were therefore designed in a consequential, conversational way to allow key themes to emerge. Data was then subject to qualitative and semi-quantitative analysis as appropriate. This approach complements the intricate and unique nature of each farmer’s reaction, and allows for further probing when required. Where possible, the present study also involved semi structured ‘focus group’ interviews at farmer association (aqua club) meetings using similar questions as 5 for the individual interviews. The purpose was to give the fieldwork component a more comprehensive picture of farmer reactions to BMPs by drawing on two levels of analysis. Themes identified during individual farmer interviews were also discussed with the associations/aqua clubs as a validation and verification step. Interviews were carried out in Vietnamese with the assistance of a translator from the Vietnamese CARD project team. Project team members know many of the farmers well and have been working with them for several years. By being connected with this trustworthy team, farmers felt at ease during the interview process and gave greater insights into their experiences. The questions (Attachment 2) are based on the outcome of the survey undertaken by Phan et al. (2009) and Tam et al. (2010), as well as additional questions required to answer the key objectives. The survey data are expected to identify key elements of farmer knowledge, aspirations, skills and attitudes (KASA) relevant to BMPs. A summary of the theory of action for the present study based on the completed evaluation was prepared based on an established evaluation-planning framework template (DPI 2009). The design of this study considers a matrix of ‘context’ scenarios to assist data analysis (see below). The use of two studies at different times, one pre and one post BMP implementation, is designed to give a greater diversity of responses. Within each study there are further sources of variation for a more detailed analysis to measure impact. The Phan et al. (2009) study considered both farmers planning on being involved in the BMP project as well as other catfish farmers. The new survey in the present study considers primarily the response of farmers involved in the BMP demonstration trials. Sources of variation Pre-existing data (Phan et al 2009) Evaluation Fieldwork Component Time period Pre BMP implementation Post BMP implementation Sample size of farmers Large Small Type of farmers All scales of production Primarily household- scale BMP farmers (and variation with level of BMP implementation on each farm, pond basis or entire farm) Location of farmers Four provinces- An Giang, Can Tho, Dong Thap and Vinh Long All provinces with emphasis on An Giang and Can Tho Survey respondents Individual Individual and group Focus of study Broader understanding; quantitative and qualitative aqnalysis. Deeper understanding (of each farmer’s reactions; more probing) and qualitative analysis. 6 Qualitative analysis of survey results for BMP demonstration trials A three-phase qualitative analysis approach was utilized, guided by the conceptual framework and research objectives of Miles and Huberman (1994) and Kitchin and Tate (2000). The process was concurrent, iterative and reflexive in nature. The first phase involved identifying key themes in the interview transcripts. The original interview transcripts were segregated into separate files based on the identified key descriptive categories or themes, while ensuring data was not stripped from the context it occurred in (e.g. farmer characteristics). This approach reduced the data into a more analytical and readable format and a new way of thinking about the data. The new transcripts were then interrogated for patterns such as common issues, differences, and changes over time, space and society. Following this, a second phase of analysis broke down the new thematic transcripts into further, analytical categories that had emerged during the first phase. The new transcripts were again searched for commonalities, differences and changes over time. The process finished when there were no more emerging categories or ideas. The third phase of data analysis then involved piecing the categories back together in a holistic and integrative way that provided an explanatory framework or coding structure according to Hay (2005). This coding structure (or framework) allows data to be organized in way that patterns commonalities, and relationships, correspondences and even disjuncture are identified and brought out for scrutiny. Categories that were explored by the largest amount of data (i.e. across a number of farmers) and responded most directly to the research objectives of the study provided a basis for the conceptual, thematic framework, and categories were grouped together under each theme based on similarities between categories, substantive relationships and conceptual links (s & c). Other, more marginal categories were then also incorporated into the framework as appropriate. 2.3. Results Semi structured interviews were conducted with 23 different farmers, laborers, technicians or managers, depending on who was available at the time of the interview, and five informal discussions were held with other key farmer stakeholders. In total, this consisted of nine BMP farmers and 14 non-BMP farmers located in 5 different provinces of the Mekong Delta, Can Tho, Dong Thap, Vinh Long, An Giang and one farm in Hau Giang province. BMP farmers had been selected prior to the study (see Phan et al., 2009 for methodological process) and non-BMP farmers were identified through random, opportunistic sampling within the logistical limitations of the study. 7 2.3.1. Existing Survey Data Existing survey data from Phan et al. (2009) and associated qualitative analysis is summarized and described in Attachment 3). 2.3.2. BMP Demonstration Evaluation & Conceptual framework The conceptual framework for analysis of the BMP demonstration evaluation survey data identified three key overarching themes that had become apparent both through the data collection and analysis phases. Data categories were subsequently assembled and interpreted under the three themes and together this produced a holistic representation of the survey data. The three overarching themes are as follows; 1. The diversity and complexity of the industry, 2. The constant process of change in farming practices, 3. The relationships and connections farmers hold both between each other and others in the community. 1. The diversity and complexity of the catfish farming industry Broadly speaking there are three categories of different farmers represented in the survey sample, which in simplistic terms effectively reflects the overall organizational structure of the ‘producer’ component of the industry in the Mekong Delta. Indeed the analysis revealed that farm size, production output (tonnes/yr) and investment strategies became important determinants and working definitions of which category a farm would fall into for the present study(see Table 1). It is however, noted that these are preliminary classifications based on a relatively small sample size. It is very difficult at times to accurately define farms, as producers engage in complex farm and business enterprise arrangements at any given time. On the basis of these classifications and in consideration of the broader survey and CARD project results to date, a simplified schematic summary of the existing catfish market chain is provided in Attachment 4, showing differing levels of vertical and horizontal integration between catfish farming and processing sectors. 8 Table 1 - Preliminary classifications of surveyed growout farmers and broader industry structure: Small Household-scale Large Household-scale Industrial scale No. of farms 9 8 6 (incl. 1 farm as part of processing company). Farm size (ha) Less than 2ha Greater than 2ha, less than 15ha. Greater than 15ha Total production (tonnes/yr) Less than 500T at present (although with potential to produce more if markets are favourable) Production greater than 500T, less than 2 000T at present (although with potential to produce more if markets are favourable) More than 2 000T Investment strategies May also farm rice or fruit on adjacent land, or periodically farm other fish species in ponds. Generally only produce striped catfish on the farm, although may also have other ‘non/off- farm’ enterprise as additional income May have multiple culture areas, and /or are involved in other sectors of the industry (e.g. processing, feed manufacturing) Through segregating farmers into these classifications it became clear there were a general downgrading and/or diversifying trend within the household- scale farmers. This was evident in the language used to talk about current and future farming practices and aspirations. In contrast there was a certain sense of optimism expressed by industrial-scale farmers (Table 2). The downgrading and diversifying trend of small-scale farmers was also supported by the comments made by several extension officers and research assistants. For example, one research assistant said, “ it is becoming increasingly difficult to culture catfish, investment costs keep increasing, which means the industry is out of the everyday farmer’s reach.” He further said, “catfish culture belongs to processors, and that 40% of small scale farmers will leave.” The industrial scale farmers also all expressed awareness about the need to certify their farms for access to international markets. Two farms were beginning to change practices in the future anticipation of receiving GlobalGAP certification. In contrast, a number of household-scale farmers had limited or no awareness of such market schemes, despite risks to maintaining ongoing market access and associated impacts on market demand from processors and other buyers. 9 Table 2: Summary of statements from survey respondents providing general perspective on production practices and current/future industry status/potential. Producer classification Quote (general perspective on production practices and current/future industry status/potential) small household-scale “I love to culture catfish, however am loosing money so will maybe change to another species, like snakehead or lotus” (future) large household-scale “I would look younger but catfish farming makes me older” (current) large household-scale “I have worked for ten years in catfish culture, feed, growout and share in processing company, yet I still don’t see a future of this catfish company.” (Past) industrial scale “Expects things to improve (in future), but short term is a problem.” industrial scale “ Just invested US 500 000 in own feed mill, and wants to lease processing plant and then be fully self-contained to export directly. “ (Future) Complexity of the economic concerns of different farmers Another key difference observed between surveyed farms is the complexity of economic concerns that exist presently. Although the low market price situation (effectively at or less than production cost presently) was a key general concern across all farmers, there seems to be more to this arrangement than a simple low price problem. In particular, the need to having a ‘social’ connection to facilitate a contract with a processing company seems to be an ad hoc/opportunistic but otherwise crucial determinant of economic success for some of the household- scale farmers surveyed. From the field data, four types of farmer:processor relationships exist which seem to be linked with the productive potential of the farms. 1. Farmers that have no relationship with a processor: Only small household- scale farmers depicted this situation (7 farmers). They sell their fish at the last minute, which puts the farmer in a low bargaining position and leads to difficulties obtaining a reasonable price for their fish. These farmers also expressed concerns about processors not giving their payments in sufficient time. One farmer commenting he had to wait up to one year to receive the full payment for his harvest. This creates further financial difficulties for farmers who said they often have an outstanding debt with a bank or other informal credit arrangements that charge high interest rates. 10 2. Farmers that have a personal connection and/or contract with processors (sometimes also involving an arrangement with a feed company as well): 5 household-scale farmers (4 small, 1 large) had this relationship. They said it was a key advantage for them and reported more positive economic outlooks than farmers with no relationship or contract. For example an employee on one farm said the “owner of this farm can survive, (even though small-scale) because he has a personal connection with a processing plant and feed mill.” While an employee from a different farm said this farm “has advantage from a good relationship with processing company ”. 3. Farmer’s who don’t have a relationship with a processor but are experienced negotiators: Two farmers (one industrial and one large household-scale), who didn’t report the same problems as the small household-scale farmers in selling their fish. They said they could negotiate with 2 to 3 processors and choose which one gave the best price for their fish. One farmer said he had a quite good relationship with 2 main processors because his farm produced a large volume of high quality fish, which gave him good bargaining power. 4. Farmers connected to processors directly: Five farms (4 industrial, 1 large household-scale) either own or have shares in a processing plant, so reported no problems selling their fish, however the low price was still a problem affecting overall profitability if not overall economic viability. In summary, farmers with Type 2, 3 & 4 relationships with buyers seem to have the market for their product, but the problem at present is the general price low, whereas farmers with Type 1 relationships seem to have market and price problems. 2. Process of change Historical dimension to process of change Throughout discussions with different farmers and through the data analysis process it became clear the historical aspect or dimension of different farms provided valuable contextual information about the current diversity in farming practices. For example, one industrial-scale farmer started with one cage of catfish culture in 1974 and gradually built up the business whereby today he is a major producer, with five farm areas, one processing plant and a second plus a feed mill on the way. In contrast, several household-scale farmers used to be rice farmers and have converted parts or all of their land to catfish farming within the last 10 years. In contrast another large-scale farm used to be a fruit farmer but converted to catfish culture 5-6 yrs ago. This diversity of different historical dimensiosn has implications for how farmers perceive their farming and future farming practices and strategies, in particular their investment and degree of engagement and commitment to the industry. Current strategies as part of process of change [...]... in addressing social and environmental issues and overall sustainability of the catfish farming sector in the Mekong Delta On the basis of this study and the key findings and conclusions, a draft evaluation plan is proposed (Attachment 5) designed to facilitate the industry- wide adoption and ongoing implementation of BMPs for catfish farmers in the Mekong Delta, Vietnam This evaluation plan is intended... artificial fertilizers Such arrangements are valuable as they show a sense of how catfish farming may be integrated within broader agricultural landscapes to the benefit of local communities and the broader environment Formal cooperative arrangements within the industry As previously stated, some farmers are already involved in formal cooperatives and associations at a local level (e.g Can Tho Fisheries Association),... and reasonable limitations in terms of addressing all attendant market-related problems within the existing catfish sector in Vietnam Accordingly, BMPs cannot be seen as a panacea for the industry s problems, and therefore multiple, targeted strategies, incorporating BMPs and other industry development and marketing elements will be required to address the different issues that are plaguing the industry. ..An emerging issue is the way all farmers are constantly trialing and testing different strategies to optimize financial returns There is significant diversity and variation in these practices, which is mainly based on the different scales of production and financial capacity of farmers, as well as to some extent their knowledge about the industry and social/business connections they may also possess... viability and how best BMPs should be adopted and implemented at an industry- wide scale 3 Network relationships and connections Relationships between catfish farmers Informal cooperative arrangements between catfish farmers suffuse the industry and highlight the implicit and explicit roles of farmer associations in accessing and sharing information (and therefore likely role in BMP adoption and implementation. .. risk management and communication plans; all requisite components of sustainable industry growth and development going forward 19 Key References AusAID (CARD) Project Partners, 2009 Better Management Practices (BMPs) for striped catfish (tra catfish) farming practices in the Mekong Delta, Vietnam, ’ Second Draft, Version 2., viewed 2nd February from, ... seller, chemical sellers… Medical seller has also shown how to take care of the fish and treat the water environment”, Such anecdotes highlight the continued influence of chemical and medical manufacturers and retailers have in the catfish farming industry BMPs as current process of change Within the context of the present study and the associated CARD project, the development and demonstration of BMPs exemplifies... putting in place cooperative arrangements between farmers and processors, there seems to be some inherent barriers that are preventing such an outcome In an informal meeting with several different catfish farmers, all were saying they wanted a cooperative to help them with their farming practices, and yet it was not immediately apparent to them that the discussion at the time was a working example of. .. possess For example, one industrial-scale farmer has five farms and is investing in a feed mill and wants to lease a processing plant This company is also horizontally integrated by growing red tilapia in cages along the Mekong River, and has diversified interests in a ceramics business The farm also has good connections with key R & D agencies and is involved in several projects including the CARD BMP project,... project, an eel farming trial, a ‘clean aquaculture’ project, and a feed trial with support from the provincial government As another example, another large household-scale farmer started as a grow-out farmer but has since added vertically integrated nursery and feed milling and owns 10% of a processing company, in attempts to boost overall profitability This farmer has also now started red tilapia production . 1 A PRELIMINARY EVALUATION OF ADOPTION AND IMPLEMENTATION OF BETTER MANAGEMENT PRACTICES IN THE CATFISH FARMING INDUSTRY IN THE MEKONG DELTA, VIETNAM CARD Project 001/07/VIE August 2010. farming sector in the Mekong Delta • Improved performance of BMPs in addressing social and environmental issues and overall sustainability of the catfish farming sector in the Mekong Delta. involved surveys of catfish farmers involved in the BMP demonstration trials primarily from two (Can Tho and An Giang) of the four major catfish farming provinces in the Mekong Delta, but also