World Aquaculture 47 primarily in summer, an annual labor input of 240-250 hours is required, with an estimated labor rate of $30/hour. Labor is a cost because watermen could have done numerous other activities with that time, such as working in a different fishery. To achieve what the model defines as “economic success,” profit must be greater than the start-up cost plus interest. To be worth the investment, the yield must be greater than that from another use, such as yield interest from a bank bond. Results After considering all variables of costs, probability and revenue, the model estimated an economic success rate of 93 percent. In the 7 percent of cases where economic success was not attained, the farm did not fail, but had not yet reached the profit threshold for economic success. After the first year, net yearly revenue averaged $17,643. Cumulatively this resulted in an average wage to the watermen of $132,000, or $66,000 per person, with $49,899 of profit, more than double the start-up cost (Fig. 1). We conducted a sensitivity analysis by varying the three main variables in the model: grow-out period, survival rate, and sales price. The grow-out period, originally 15 months, was reduced to 12 months or increased to 18 months. When the grow-out period was 12 months the rate of economic success was 97 percent, with an average profit of $57,029. When the grow-out period was 18 months, the rate of economic success was 86 percent, with an average profit of $45,167. In all cases, the farm remained solvent. The average survival rate, originally 82 percent, was decreased to 78 percent and increased to 86 percent. When the survival rate was 78 percent, the rate of economic success was 84 percent, with an average profit of $43,807. When the survival rate was 86 percent, the rate of economic success was 96 percent with an average profit of $55,001. In all cases, the farm remained solvent. The final sales price, originally averaging $0.25, was decreased to $0.22 and increased to $0.28. When the sales price was $0.22, the rate of economic success was 1 percent and, in 2 percent of model iterations, the farm became insolvent. The average profit was $13,015. However, the farm typically had debt outstanding after 10 years. When the sales price was $0.28 the rate of economic success was 100 percent, with an average profit of $86,976. The economic success figure of 100 percent for the price of $0.28 is suspect because no business endeavor can have zero risk. However, it simply means that the farm will not fail to be successful because of anything programmed into the model. The model is a useful simplification of the real world and cannot fully account for all variables that affect aquaculture production. The sensitivity analysis indicates that sales price overwhelms the importance of the duration of growout and survival rate. A price increase of $0.03 per oyster resulted in a profit increase of $37,077. If prices fall by $0.03 there is little chance of economic success. This suggests that additional effort in getting a better price, such as selling directly to local restaurants or farmers markets, is a very good investment. The reduction in economic success from an increase in the duration of grow-out or a decrease in survival rate may mean the difference between acceptance or rejection of a new business model. However, these effects are much smaller than the effect of sales price. Efforts to reduce the duration of grow-out or increase survival result in progressively smaller increases in returns. Conclusion The current wild harvest model has clearly failed. Oyster aquaculture offers a better strategy to replenish the oyster population and provide job opportunities for watermen. Results of model simulations using AQUASIM indicated that oyster aquaculture can be done as an economically viable parttime activity to complement other traditional activities of watermen. In this way, oyster aquaculture can also help preserve the culture of the Chesapeake Bay. Notes 1Morgan State University Estuarine Research Center, 10545 Mackall Road Saint Leonard, Maryland 20685 2St. Mary’s College of Maryland, 18952 E. Fisher Road, St. Mary’s City, MD 20686 References Anonymous. 2009. Gem of the Ocean. The Economist Newspaper Limited 2 January: 46-48. Locke, D. 1993. Oyster Fisheries Management of Maryland’s Chesapeake. Image Inc. New York, New York, USA. Maryland Department of Natural Resources. 2006. Maryland Oyster Population Status: AReport. MDNR Publishing, Annapolis, Maryland, USA. Fig. 1. The per year cashflow is shown for net income, labor cost, loan payments and profit. Table 1. Breakdown of project costs. Oyster seed $4,500 (150,000 at 20 mm) Oyster cages (50) $7,294 Rope and line $ 489 Boat supplies $ 462 Crane and winch $2,498 Power washer $1,980 Fuel, maintenance, etc. $2,000 (estimate) Total Cost $19,223
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