Sea cucumbers are considered overfished worldwide, due to its high economic value. Fortunately, alleviating pressure on wild stocks is now possible through sea cucumber farming in some countries, especially in Asia, West Pacific, and Indian Ocean. This is being realized through the development of hatchery technologies and methodologies for commercially important sea cucumbers like the tropical sandfish Holothuria scabra. Unfortunately, the adoption of such hatchery technology and the establishment of hatchery facilities have been slow because of many concerns and apprehensions from potential investors. The primary limitation is the profitability of the hatchery operations and the market accessibility of sea cucumber seeds.
In this study, we aim to assess the economic viability and resilience of a small-scale hatchery with 10 units of 3-ton capacity larval tanks, as a template for developing countries like the Philippines. Data for the economic assessment was taken from actual records of hatchery construction and more than 10 years of sea cucumber H. scabra seed production operations at the Southeast Asian Fisheries Development Center, Aquaculture Department (SEAFDEC/AQD) hatchery facility in Iloilo, Philippines.
Cost and return analyses (CRA) were performed based on existing hatchery protocols and current set of technical assumptions to assess the viability of operations at varying survival rates (SR) and selling price levels. The liquidity of the technology over a 10-year period was analyzed through financial investment analyses. Our main results suggest that maximizing the use of all 10 tanks (3-ton capacity each) per spawning run and conducting 5 runs per year is the most viable operation frequency, which can conservatively produce a total of 450,000 sandfish seeds (5 mm spats or early juveniles) per year at 1% SR. However, 1% SR will yield a negative return on investment (ROI) when seeds are to be sold at PhP1 each (1US$=PhP56). At this SR, selling at PhP2 can yield a modest ROI of 25.31%. An improvement in SR to 2% will result in 25.31% ROI at PhP1, and a robust ROI of 105.82% at PhP2.
The economic analysis suggests very good prospects for profitability even at small-scale operation of a sandfish hatchery. However, it may be challenging to maintain even the low SR target of 2% in a practical and non-environmentally controlled facility. Additionally, it will be important to maintain a stable market willing to pay PhP2 per spat of sandfish, at a minimum volume of 90,000 spats every 2-3 months.
This study provides useful information about the economic feasibility of constructing and operating a small-scale sandfish hatchery, using realistic selling prices and production efficiencies to improve its economic performance.