FI:DP/LAO/97/007 STS - Field Document No.

PROVINCIAL AQUACULTURE DEVELOPMENT PROJECT

LAO PDR

SUPPORT FOR TECHNICAL SERVICES

Mini-Hatchery Development

Based on the work of Samruay Meenakarn FAO Mini-hatchery Consultant 8 23 May 1998

THE FOOD AND AGRICULTURE ORGANIZATION OF THE UNITED NATIONS Bangkok 1998

The designations employed and the presentation of the material in this document do not imply the expression of any opinion whatsoever on the part of the Food and Agriculture Organization of the United Nations concerning the legal status of any country, territory, city or area or of its authorities, or concerning the delimitation of its frontiers or boundaries.

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The Food and Agriculture Organization is greatly indebted to the organizations and individuals who assisted in the implementation of the project by providing information, advice and facilities.

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Table of Contents

Page 1. 2. 3. 4. 5. Background Fish Fry Production in Lao PDR Mini-Hatchery Workshop Nongteng Fish Seed Station Conclusions Recommendations 1 1 6 6 7

Appendix I Appendix II Appendix III

Terms of Reference and Itinerary Workshop Timetable Economics of Potential Mini-Hatchery Operation

10 12 13

ACKNOWLEDGEMENTS

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The consultant would like to thank all those people that assisted him during the mission especially those who extended their kind hospitality during the field visits. The dedication and interest of the staff of LAO/97/007 has been of great assistance during the workshop and field visits.

1.

BACKGROUND

This consultancy was carried out within the scope of the Provincial Aquaculture Development Project LAO/97/007, to assess the constraints and conditions the country is facing with respect to development of mini-hatcheries (Terms of Reference are attached in Appendix I). This reports reflects the results of the mission the consultant did during the period 8 23 May, 1998 to demonstrate hatchery techniques in a workshop held 11-15 May (Section 3 below refers). The consultant will complete his task by submitting a manual on the design, operation and regular maintenance of minihatcheries. The manual will expand on the subjects dealt with during the workshop, including minihatchery design.

2. FISH FRY PRODUCTION IN LAO PDR Estimates of the land suitable for fish culture in Lao PDR vary widely, but the consensus of opinion is that there is still a great opportunity for the expansion of fish culture in the country. Lao PDR is typified by a wide range of geographical and climatic zones. There are cool upland regions and hot lowland floodplains. Besides large areas of rice paddy there are also wetlands, irrigation and hydroelectric water storage structures, perennial streams and rivers. This provides a wide range of opportunities for fish culture in the country. Traditionally, fish and aquatic products have formed a significant part of the diet of the Lao people, particularly the lowland Lao. Monsoon season fisheries have been abundant and the flooding of ricelands provides a diverse habitat for many fish and other aquatic species (frogs, snails, insects etc.). These are all exploited widely during the wet seasons. Government estimates of the land currently under aquaculture production are presented in Table 1. There is still considerable hectarage of suitable land that could be developed for aquaculture either as pond culture or as rice-fish culture. The production figures for pond culture are inflated since most small farmer ponds do not yield as much as 2,500 kg per hectare, due to the low feed inputs to the system and the tendency to harvest fish gradually through the season, rather than batch harvest. The majority of pond production is currently performed in the Vientiane Province and Vientiane Prefecture areas (totaling 58 % national production, 38 % of pond area) and these farms have higher production figures due to their more intensive management methods. Table 1. Government Estimates of Total Fish (Aquaculture and Fisheries) Production (1996) Area (ha) Production (mT) Fish Ponds 3,016 7,540 Lakes, Natural ponds etc. 7,019 3,737 Wetlands 27,029 811 Cages 175 Rainfed rice 400,000 6,454 Irrigated rice 13,347 54 Reservoirs (Irrigation) 34,480 689 Reservoirs (Hydro-electric) 48,196 1,060 Total 20,520 Source: Department of Livestock and Fisheries Publication (1) Not all rainfed rice produces fish this is especially the case for hill rice) (Kg/ha) 2,500 532 30 *(1) 4 22 20 -

The government estimate for the number of farmers producing fish in Lao PDR is approximately 2,400 although it is likely that this figure is underestimated.

Demand for Fish Fry Estimation of the fish fry requirement of the Lao PDR have been made, principally according to the area of ponds, reservoirs and ricelands that are suitable for fish production (Table 2.). These figures may be optimistic since not all the land may be suitable for aquaculture but it does serve as an indication of potential requirements. This is particularly the case with respect to the very low stocking densities employed in the pond and rice-cum-fish aquaculture systems in Lao PDR. Table 2 Estimated Fish Fry Production and Demand in Lao PDR (1996)
Province Fry Production State Hatchery 563,000 150,000 450,000 250,000 2,000,000 3,500,000 150,000 720,000 70,000 500,000 8,359,000 Demand Private Enterprise 30,000 40,000 28,000 2,500,000 500,000 3,660,000 25,000 455,000 10,000 66,000 7,313,000

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 Total

Phongsali Luang Namtha Borkeo Oudomxay Luang Pabang Hooa Phan Xieng khouang Sayaboury Vientiane Province Saisomboon Special Zone Vientiane Prefecture Bolikhamxay Khammouan Savannakhet Salavan Champassak Sekong Attapeu

400,000 800,000 500,000 700,000 3,500,000 670,000 11,000,000 1,500,000 10,560,000 11,000,000 450,000 570,000 5,700,000 560,000 3,800,000 300,000 150,000 52,160,000

Source: Department of Livestock and Fisheries Publication Even if the figures are slightly inflated it is apparent that the fry production in the country is far below the current demand (only 30% of demand is supplied by in-country production). Since the demand for fish fry in Lao PDR is not satisfied by in-country production there is a significant incentive for the importation of fish fry from adjacent countries. Thailand, Vietnam and China are sources of fish fry into their adjoining provinces. The importation of fish fry is illegal but largely tolerated since the demand is so high. These countries are also able to produce fry at prices lower than that possible within Lao PDR and this also drives the fry importation business. A recent study by the AIT Outreach project in Savannakhet estimated that approximately 9 million fry were imported from Thailand (It is possible that some of these were distributed to other provinces). The production within Savannakhet Province is still probably less than 2 million. The quality of imported fry is often inferior to that produced within Lao PDR due to long transportation time and the associated stress. In order to transport large numbers, the imported fry size is smaller than that which is desired by the farmers, however the shortage of locally produced fry denies the farmers choice in the matter. The fry available to Lao PDR buyers is often of unsaleable quality within the producing country this is another factor influencing quality. Since the climate of Lao PDR is typified by an intensely dry season of approximately 6 months followed by an equal period of monsoon, fish culture is largely practiced seasonally. There are very few areas of Lao PDR that are able to retain standing water all year round. The exceptions to this case are some low-lying wetlands and areas supplied by river or irrigation schemes. Even when there is perennial water in rivers, it is not possible for small farmers to lift the water 20 30 meters for use in aquaculture facilities. Since there is a limited amount of time during which aquaculture can be carried out in seasonal ponds such as are typical in Lao PDR, there is a peak requirement for fish fry during the early part of the monsoon

season. This requires that the large numbers of fish fry required by farmers must be supplied within a relatively short period of time. The only method by which this can be achieved is by the propagation of species that have high fecundity. Market Price Buyers are aware of the problems associated with imported fry and as a result fry produced in Lao PDR does get premium prices. The cost of imported and locally produced fry to the small farmers is usually the same (average about 20 Kip per piece). The exception to this is Savannakhet province, where large-scale importation of low cost fry from Thailand drives the price of small fry down to 10 Kip per piece. In provinces remote from neighbouring countries, or with poor communications, prices can rise as high as 50 Kip per piece (e.g. Vietnamese Grass Carp fry in Oudomxay). These current economic factors (market demand and price) favour the establishment of small-scale hatchery enterprises. Market Size Typically, the size of fry required by farmers is in the size range of 3 5 cm. Farmers prefer larger fry because of the higher survival rate in their extensive production systems. Small fish fry are easy prey for the aquatic insects and frogs that abound in the fishponds, wetlands and rice fields of Lao PDR. This requires the hatcheries to nurse the fry for about one month or more before sale. The requirement for these larger, nursed fry places a burden on the hatcheries since heavy losses occur in the fry nursery ponds. The hatcheries can produce large numbers of eggs and newly hatched fry, but their capacity to hold the fry is limited by the small area of nursery ponds available. The economies of scale that favour large hatcheries in other countries limit their viability in Lao PDR. Since farmers only take fry away in small numbers, large batch production of fry is limited by the requirement for holding on the hatchery site. Small locally based hatcheries are better suited for distribution of small numbers of fry to farmers in their locality and can be assured of sale of all their production since orders are taken in advance. Species Farmers may have preferences for fish species, but the reality is that in most cases they will accept whatever fry is available when they wish to stock their ponds. The species generally produced by private enterprises (large and small) in Lao PDR are Cyprinus carpio, Puntius spp., and Tilapia spp. The state hatcheries produce a wider range of species including the above and also: Chinese carps and Indian carps and several indigenous species (usually not for sale). One of the problems confronting the state hatcheries is the maintenance of broodstock. Since the hatcheries attempt to hold as many species as possible they often are left with insufficient numbers of any species to produce significant numbers of fry. This shortage of broodstock prevents several spawning cycles of a single species during the appropriate season. The limitation of the number of species held by each hatchery should be promoted and emphasis placed on species that are easy to produce in large numbers (and preferably indigenous species). There are several Puntius species indigenous to Lao PDR and preliminary rearing trials by the DLF suggest fast growth rates in ponds. Puntius sp. is attractive for mass production due to its extreme ease of spawning and maturation at a small size (> 250g). These fish are also acceptable to local people who can also catch them occasionally in the rivers. Previously, Chinese and Indian carp have been promoted in Lao PDR as suitable candidates for aquaculture. These species have advantages in that the production techniques for these species were well established and the fry are relatively easy to nurse. It is because of this that many of the state hatcheries still try and produce these species. The problems associated with these carp species is that they mature at a large size (ideal broodstock size is at least 2 kg) and thus they must be maintained for long periods at the hatchery

before they can be matured and spawned. Many of the state hatcheries failures to produce fry from these species has been due to attempting to spawn these fish before they are fully mature. The long holding time for the fish has also resulted in theft or poor nutrition due to lack of appropriate feeding at the hatcheries. Common carp (Cyprinus carpio) are very suitable to both small-scale farmers and also the government hatcheries. This species is very easy to produce and often forms the bulk of fry produced by many operators. It has a relatively lower market value and the fact that small farmers are able to produce these species results in government hatcheries avoiding mass production since they would be competing against the small farmers. It is probable that the state hatcheries could not produce common carp fry for a price as low as that of private enterprises. Tilapia sp. are often held at hatcheries since they can be produced almost all year round when water is available. This species is not really suitable for the state hatcheries since the fry production techniques require large numbers of net cages and this uses valuable space at the hatcheries. Whilst fry can be produced all year round, the seasonal demand for fish fry that occurs during the early part of the monsoon season cannot be fulfilled by the Tilapia cage rearing technology. Fry Production Techniques State Hatcheries Most of the state hatcheries (Provincial Fish Seed Stations) were constructed by USAID funding during the period 1956 1975. The basic designs of the hatcheries are similar and rely on gravity fed water into square concrete tanks. Water is rarely pressurized and usually taken from a stream or reservoir. In most cases the water supply is insufficient for culture of fish before April. Nursery ponds are present at all stations but these suffer from water shortage as well (especially in Savannakhet, Sayaboury and Khammouan). The nursery ponds cannot be drained in many cases and need to be pumped dry. This limits the pond preparation process and often results in poor fry survival after stocking. Broodstock ponds are present on the stations and a mixture of species are present (see section on species above). Most successes of the stations are achieved with common carp, Puntius, Tilapia, Indian carp and in a few cases Chinese carp. Feeding of broodstock is usually carried out, but the nutritional value of feed provided is doubtful. Common carp are spawned naturally by transferring the fish to tanks and flowing water to stimulate spawning. Artificial spawning substrate is used (plastic string) and the attached eggs are incubated in the tank. In some cases the spawning substrate is transferred to the nursery pond for fry hatching and subsequent nursing. There is little intervention in this process and survival rate is low due to poor egg hatching and predation of the fry in the nursery ponds. Species that require hormone induction of spawning are treated with LHRH analogue in combination with Domperidone maleate. The source of the hormones is Thailand, Vietnam and China. The hormones obtained from Vietnam and China may not be standardized and may have degraded. The Thai hormones are human drug quality and therefore extremely reliable for fish breeding; their trade names are Suprefact and Motilium respectively. Fish pituitaries are not used in the country since the chemical hormones are now widely available and significantly more reliable with respect to dosage. In addition, only one injection of the hormone is required, in contrast to the two that were previously required using pituitary. There is also a shortage of large mature carp that are the usual source of the pituitaries as serious logistical limitation to their use. After injection the male and female fish are allowed to spawn in a large tank with flowing water. Eggs are collected from the tank and transferred to either incubation nets or directly to concrete tanks. In some cases upwelling hatching cones are used. The damage to eggs and lack of spawning of some fish limits the success of this operation and therefore limits the initial production of fry. Artificial fertilization using

stripping of eggs and milt is not practiced widely even though this method significantly increases the fertilization success of the spawning process. First feeding fry are provided egg yolk and finely powdered rice bran. It is probable that the feed applied is insufficient for the fry since the hatcheries are reluctant (or lack the budget) to spend money on feeds. Fry are transferred to the nursery ponds as quickly as possible and some bran is added as feed. The survival in the nursery ponds is extremely low due to the high numbers of predatory insects and frogs, tadpoles etc. In some cases the fry are nursed in cages to exclude predators but this is not common. Some of the hatcheries attempt to remove predators by lime and diesel application prior to stocking the hatched fry. Survival out of this system is low (approximately 10%) and could be significantly improved with the modified management techniques that were presented by this consultant during the training workshop. Private Entrepreneurs There are few private hatcheries, although there are many farmers engaged in producing their own fry. Small farmer fry production techniques are usually confined to common carp, Tilapia, and Pa Fek (tentatively identified as Carassius auratus by W. Rainboth). Production of the popular Puntius sp. is limited by lack of reliable spawning in ponds. This species can be very easily induced by a small hormone injection (Suprefact and Motilium) and, where this has been made available, farmers have had success at producing this species. The AIT Outreach project is involved in supplying small farmers with fry production materials and hormones for injection and could be used as a model for other areas for stimulating small farmer fry production. Nursing of fry is usually performed in small earthen ponds with some pond preparation (usually fertilization). Predators are not excluded and survivals are low. Feeding of the fry is typically with rice bran. Even with low fry production, these small farmer operations are profitable due to the very low inputs required. If such operations were slightly improved, very significant increases in production could be achieved. Typically the small hatcheries lack water to maintain broodstock and do not have efficient egg hatching and spawning techniques, this is mainly due to the lack flowing water on their sites. A major constraint to development of small hatchery operations is the lack of access to the finance required. The Agriculture Promotion Bank can release funds but has not yet done so for hatchery development. The procedures for obtaining credit are complex and ultimately the sums of money that are provided are too small to be useful for hatchery development. A sum of approximately 2 3 million Kip ($800 - $1,200) would be required for construction of a small mini-hatchery and the expected payback time could be within one year at the prices currently charged for fish fry. Access to credit via revolving funds administered by the District Department of Livestock and Fisheries has been suggested by one of the Provincial counterparts as a method for hatchery improvements/development. An alternative to this approach would be the loan or hire/purchase of equipment items allowing a low cost start for hatchery entrepreneurs. A potential criteria for the entrepreneurs would be the provision of a small sum of capital and the demonstration of a suitable site for the activities (i.e. ponds already constructed). Nursing Network This idea has been pioneered by the AIT Outreach project in the south of the country (Savannakhet province). It involves assisting small operators in the nursing of fish fry in net cages to sell on to other farmers when they reach a marketable size. This has the advantage that the techniques of fry production are not required since they are performed at the provincial hatchery. The small farmers merely take fry and nurse for up to one month and then sell. The economics of the operation are favourable, although the capital cost of the net cage can be a problem. Typically the farmers rent the net cages at a subsidised rate for the nursing period. Members of the network are given an ID card which also allows them to purchase small fry at reduced costs from the Provincial hatchery so that they can continue their operation after they are no longer assisted by the project.

3. MINI-HATCHERY WORKSHOP NONGTENG FISH SEED STATION The mini-hatchery workshop was held at the Nongteng Fish Seed Station between 11th 15th May. Training lectures and discussions were conducted beside hatchery facilities. This ensured that participants could observe and take part in all aspects of the fry production process, and practical hands on demonstrations were provided throughout the 5 day workshop. In total 15 provinces were represented and there was a total of 30 participants. Besides government hatchery staff, 4 local private sector trainees and 2 United Nations Volunteers attended the workshop training. The NPD and the project ADA have indicated that provincial level training courses for non-government hatchery entrepreneurs are scheduled to be held in 1999. The reason for training of government staff first is to provide some level of technical support at the provincial level for the establishment of mini-hatcheries by the private entrepreneurs. Nongteng Fish seed Station Hatchery has been modified recently following the recommendations of the Aquaculture Development Advisor (LAO/97/007). Since the basic design of the hatchery is similar to that of other provincial hatcheries, the participants were able to observe how low cost simple renovations could assist them in improving seed production. Participants were given samples of hatching cones so that they may be able to construct them at their hatcheries. Demonstrations of the use of the hormones Suprefact and Motilium were provided during the training workshop and trainees had the opportunity to mix and administer the hormones themselves. Each of the provincial hatcheries represented were given sufficient fish breeding hormones and equipment to last them for 1998. It is the intention of LAO/97/007 to repeat this exercise in 1999 to ensure continuity since the cost is low (approximately $46 per province). Artificial fertilization of fish was demonstrated and trainees were able to perform this. The intention was to demonstrate the ease of the method and the increased quantity of fertilized eggs that are obtained. Potential designs for mini-hatcheries were presented utilising low cost construction techniques. Such designs would be appropriate for small hatchery entrepreneurs and could be extended by the government staff present at the training workshop. It is hoped that similar field trainings will take place in the future where mini-hatchery entrepreneurs can be introduced to the possibilities of fry production in their provinces. The methods for evaluating the economic feasibility and planning of a hatchery operation were covered during the workshop. This was particularly well received by the trainees who had previously not had a good understanding of how to evaluate the economics of hatchery operation. The fry production techniques covered during the mini-hatchery workshop will be presented in the training manual being prepared by the consultant for availability by approximately end-June.

4. CONCLUSIONS Due to the high demand for fish fry and over-reliance on imported fry, there is still a large potential for increasing fry production in Lao PDR. Fish fry production is both economically and technically feasible in Lao PDR under current conditions and can be expected to remain so for some time. 1. Improved management techniques at state hatcheries could significantly increase their production. The poor location of many hatcheries and limited space available is a constraint to good production, however closer attention to the following critical points will improve production: Sufficient breeding hormones should be purchased centrally and distributed to the provincial hatcheries early in the season. This will ensure hormone reliability and deter under-dosing by hatcheries anxious to conserve money. The total national cost for hormones for the provincial

hatcheries is approximately $644. Provision of this facility would greatly facilitate egg and fry production. The number of broodstock species held should be limited in order to increase the biomass of each species and ensure sufficient brood fish. Stripping of eggs and milt for dry fertilization will increase the number of viable eggs. The current method of injection and stocking into spawning arenas is extremely inefficient. Upwelling hatching cones or hatching cages with flowing water will significantly increase egg survival and hatching rate. Low oxygen and poor water quality are constraints at the hatcheries, but this method considerable reduces losses due to egg suffocation and occlusion with debris. The early feeding with egg yolks should be accompanied by good water exchange in Orlon cages to maintain water quality. Oxygenation and water supply to nursery tanks are often inadequate due to the fear of washing out of fry form the tanks. Orlon cages can prevent this and ensure adequate water quality. Preparation of nursery ponds prior to stocking, or the use of Orlon nursery cages will limit early predation. Losses to water insects and predatory fish in poorly prepared nurseries is common. Removal of 2 3 week old fry form nursery ponds and concentration in nursing cages (blue net hapas), accompanied by correct feeding will maximise use of nursery pond space at the hatcheries.

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There is a lack of access to finance for private hatchery entrepreneurs. Small private hatcheries using simple technologies should be encouraged by training and facilitation of finance. The financial feasibility of small hatchery operations should be demonstrated to organizations such as the Agriculture Promotion Bank to encourage the release of credit for such operations. Facilitation of credit is a planned activity for LAO/97/007, but not extension of credit. This requires assistance at district level to interested entrepreneurs to make applications to APB. There is a possibility that the UNDP Microfinance Project will be able to assist during 1999. Revolving funds administered by District Livestock and Fisheries Offices could assist mini-hatchery improvement development. Other sources of credit might be available through other organizations. Revolving funds have been demonstrated in some districts but remain experimental for most of the country. Several example situations should be developed to act as models for this activity. Central government should provide additional budgetary support for Provincial hatcheries. The current situation whereby income generated from fish fry sales is not returned to the hatchery budget seriously restricts development. Renewal of consumable and depreciated items is not possible under the current system and limits production.

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5. RECOMMENDATIONS Broodstock Species and Maintenance The large numbers of species held at the hatcheries should be reduced and the hatcheries concentrate on producing effectively one or two species of fry fingerlings. There is often insufficient numbers of fish of a particular species at the hatchery to allow several spawning cycles to be performed. This also limits the production of the hatchery. Recommended species for hatcheries are Common carp and Puntius sp. Some hatcheries can produce Indian carp and Chinese carp species. One additional species of these would be acceptable. Feeding of the broodstock fish could be improved by addition of formulated feed. These costs should be included in the annual budget for the hatchery.

Broodstock fish of an appropriate size should be used many hatcheries attempt to spawn fish that are too small to be effective broodstock. This is a particular limitation of the larger Indian and Chinese carp broodstock. The common carp and Puntius sp. do not have this problem.

Stripping and Artificial Fertilization The state hatcheries still practice mass spawning in tanks rather than stripping and artificial fertilization. This is wasteful and inefficient, particularly since the numbers of broodstock fish are limited. Hormone supplies (Suprefact and Motilium) are currently purchased by the individual hatcheries and their age and quality are not ensured. The Department of Livestock and Fisheries Central Office could buy this in bulk and supply/sell to the provinces at cost. The total national cost for hormones for the provincial hatcheries would be approximately $644 (including hormones, syringes, needles, distilled water, coolboxes etc. for 14 hatcheries)

Improved Hatching Techniques The incubation and hatching of eggs should be performed in fine mesh nylon Orlon netting (Pa geaw). Preferably an upwelling net cone system should be used for those species that have floating eggs. Such cones have been distributed by the project following the hatchery training workshop. Water flows in hatcheries have been improved in some cases as a result of the project improvements. Hatcheries not covered by the project still require such modifications. The modifications recommended by the project for Nongteng central fish seed station were observed by the participants at the hatchery workshop and have served as a model for the provincial hatcheries.

Improved Nursing Low survival rate in the nurseries has been identified as a major constraint to fry production in Lao PDR. Improvements in techniques and management could significantly increase production. Ponds should be filled just prior to stocking Puntius sp. to minimize predation. Where water is scarce/ponds cannot be drained, fry should be nursed in the hatchery and then reared in nursery cages (Orlon) until they are sufficiently large to evade predators. Feeding of fry in nurseries is not performed well the hatcheries do not invest in fry feeds and rely on rice bran and natural productivity to support the fry. This appears to be partly due to the financial management structure of the hatcheries and requires review if production is to be optimised. Improved water supply to nursing cages will increase oxygenation and reduce stress and mortality.

Holding of Nursed Fish in Cages before Sale Fry are maintained for too long in nursery ponds prior to sale. This prevents restocking of the nursery and the hatchery is filled with oversize fry. Once fry attain a size of 1 2 cm, they should be transferred to net cages for intensive nursing. Formulated feed should be provided and water flow through the cages should be ensured to increase oxygenation. This is economically feasible and will reduce losses during later stage nursing. In some stations, water availability may be a constraint. Pumping of water is an option and the cost of the fuel/electricity is still viable (see Economics Appendix III).

Management and Budgeting of Hatcheries Participants at the hatchery workshop mentioned that the budgets of the hatcheries prevented them from implementing good management techniques. Lack of funds for feeds, equipment replacement and hatchery renovation were particularly highlighted.

For any hatchery operation to be successful some re-investment is required. It is recommended that some proportion of the money obtained from fry sales be reserved for equipment replacement/repair. The Ministry of Agriculture and Forestry, Department of Livestock and Fisheries could greatly assist in the improvement of fry production by addressing the issues mentioned above.

Private Mini-Hatchery Operations Mini-hatcheries are economically feasible and could contribute significantly to fry production in Lao PDR. Appropriate technologies for such hatcheries have been presented during the hatchery training workshop, these will form the basis of field extension activities. Provincial level training courses following the model of the Nongteng workshop should be provided to mini-hatchery entrepreneurs. There is currently no provision for assistance with credit for such entrepreneurs from the Agricultural Promotion Bank and this should be pursued further. Other sources of finance or credit should also be investigated.

Appendix I TERMS OF REFERENCE AND ITINERARY

Terms of Reference - Consultant/Mini-hatchery Technology Background: Small or Mini-hatchery technology is well developed in Thailand, Bangladesh and India, but it has not been introduced in Lao PDR. The demand for fish fingerlings for extensive aquaculture is high and the existing government fish seed farms cannot fulfill it. Fish fingerlings are currently imported from neighboring countries such as Thailand, China and Vietnam; this increases cost of the fish and the quality is often inferior to locally produced fish. Production of fry and their subsequent nursing to fingerling size can be profitable enterprises and are important priorities for aquaculture development. The low investment and operation cost of mini-hatcheries and nurseries may be attractive to small private entrepreneurs in areas where there is good potential for aquaculture, but activity is constrained by lack of fingerlings.

Terms of Reference (TOR): 1. Assess the technical requirements for mini-hatchery design and operation in northern and southern target provinces. Design simple mini-hatchery systems/techniques appropriate for small scale private entrepreneurs. This should reflect the different species required and the agro-climatic characteristics of the northern and southern target provinces. Provide on-site training in artificial fertilization improved hatching and first feeding techniques to provincial fish seed farm staff where time permits. Conduct three short workshops for staff at each of the fish seed farms and private entrepreneurs willing to invest in the mini-hatcheries. This should be combined with the practical demonstrations mentioned above (3). Prepare a manual in English for the design, operation and regular maintenance of mini-hatcheries. Submit a report to FAO with emphasis on : i) Evaluate the economic and technical feasibility of mini-hatcheries, and ii) recommendations for increasing/developing low cost fish fry and fingerling production. (It is the consultants responsibility to arrange for editing of his report and manual.) Qualifications/Work Experience: 1. 2. 3. 4. 5. Degree in Aquaculture Technology with specialization in fish breeding. Approximately ten years experience in the design and operation of warmwater freshwater fish hatcheries. Small scale hatchery design and operation an advantage. Demonstrated experience in breeding and production of common carp and/or Puntius species essential. Experience of Chinese carp culture would be helpful. Practical experience of mini-hatchery technology transfer to rural fish farmers and small scale entrepreneurs, preferably in SE Asia. Good knowledge of English. Proficiency in Thai or Lao language desirable.

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3.

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5. 6.

Itinerary Date
8th May Arrive Vientiane

Persons
Dr. Simon Funge-Smith (ADA, LAO/97/007) Mr. Bounthong Sapakhdy (NPD,

Subject
Finalize initial workschedule for consultancy Discuss workshop outline and activities

10

9th 10th May Nonteng Fish Seed Station

11th May Nonteng Fish Seed Station 12th May Nonteng Fish Seed Station 13th May Field Visit 14th May Nonteng Fish Seed Station 15th May Nonteng Fish Seed Station

LAO/97/007) Dr. Simon Funge-Smith (ADA, LAO/97/007) Mr. Bounthong Sapakhdy (NPD, LAO/97/007) Mr. Liang Khamvilay (Head, Nonteng station) Mr. Somboon (Asst. Head Nongteng Station) Mini-Hatchery workshop - Day 1

Check water distribution system and implement minor modifications Check equipment and facilities for minihatchery workshop Construction of small equipment items for minihatchery demonstration Broodstock selection Hormone preparation Injection and artificial fertilization Egg incubation techniques Egg incubation techniques (cont.) Hatching and preliminary nursing techniques First feeding techniques Ta Ngone joint enterprise farm Integrated livestock and fish farm Fish nursing techniques Pond preparation Nursery feeds and feeding Design of mini-hatcheries Economic feasibility of mini-hatcheries and fish seed production in Lao PDR Discussion of hatchery and fish seed production in Lao PDR

Mini-Hatchery workshop - Day 2

Mini-Hatchery workshop - Day 3 Mini-Hatchery workshop - Day 4

Mini-Hatchery workshop - Day 5

16th 17th May Vientiane 18th May Travel to Savannakhet 19th May

Mr. Singkham Phonvisay (Director General, Dept. Livestock and Fisheries) Mr. Chantaboune Sirimanotham (Chief Fisheries Division, DLF) Dr. Simon Funge-Smith (ADA, LAO/97/007) Mr. Bounthong Sapakhdy (NPD, LAO/97/007) Dr. Simon Funge-Smith (ADA, LAO/97/007) Mr. Sukhin (Vice NPD, LAO/97/007) Dr. Simon Funge-Smith (ADA, LAO/97/007) Mr. Sukhin (Vice NPD, LAO/97/007)

Discussion on further workschedule Report writing

20th May

Dr. Simon Funge-Smith (ADA, LAO/97/007) Mr. Sukhin (Vice NPD, LAO/97/007) Dr. Simon Funge-Smith (ADA, LAO/97/007) Mr. Sukhin (Vice NPD, LAO/97/007) Mr. Peer Hijmans (FAOR) Dr. Simon Funge-Smith (ADA, LAO/97/007) Mr. Bounthong Sapakhdy (NPD, LAO/97/007)

21st May Return Vientiane 22nd May

Visit Khammouan Provincial Fish Seed Station Make recommendations for improved seed production Visit Pak Bor, Provincial Fish Seed Station Savannakhet Discuss improved management strategies to increase fry production Discuss hatchery renovation plans/implementation Visit small private hatchery operations in Outomphon district Discuss problems concerning management and finance of mini-hatcheries Report writing

Debriefing of mission Discuss mini-hatchery financing potentials

23rd May Return Bangkok

Appendix II Workshop Timetable Day Day 1 Time

09.00

Activity
Opening ceremony with representatives from FAOR and

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10.00 10.30 12.00 14.00 15.00 15.30 19.00 20.00

Day 2

03.00 08.00 10.30 11.00 12.00 14.00

Day 3 Day 4

09.00 10.30 11.00 12.00 14.00 15.00 09.00 10.30 11.00 13.00 15.00

Day 5

Ministry of Agriculture and Forestry Break Broodstock selection techniques (demonstration for Puntius and Common carp and Rohu) Lunch Hormone preparation (Suprefact and Motilium) Weighing of fish and calculation of dosages Injection of fish Stripping and artificial fertilization of fish Incubation in different systems Check systems Hatching of fry in hatching cones and tanks suitable for minihatcheries Break Larval hatching and first feeding techniques Lunch Practical demonstrations Field visit to Ta Ngon farm and small farmer operation in Vientiane Prefecture Nursery pond preparation techniques Break Nursery pond management techniques Lunch Feeding of Nursery ponds Transfer of fry to ponds Design of mini-hatcheries using appropriate materials Break Economic considerations of low cost, small scale hatcheries and nurseries appropriate to small scale entrepreneurs Lunch Closing ceremony

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Appendix III Economics of Potential Mini-Hatchery Operation The following budgets are based on calculations for equipment and fry prices in Laos during 1998. For a small hatchery operation producing 100,000 200,000 fry per cycle. 1. Fixed Costs Equipment Net hatching cone Orlon nursing cage and pipework Large blue net nursing cage Hormone preparation equipment Cement tank (2 x 3 x 1 m) Thatched Roofing Simple pipework Nursery pond (20 x 20 x 1 m) Pump (Honda 5 hp) TOTAL 2. Operational Costs Item Broodstock Hormones Rice Bran Eggs Pellet feed Fuel for pump Lime Total Units 8 kg 4 doses 53 kg 210 eggs 18 kg 63 litres 50 kg Cost (Kip) 2,500 1,000 350 200 1,500 800 300 Total 20,000 4,000 18,550 42,000 27,000 50,400 15,000 Kip 176,950 Number 2 2 2 1 1 1 1 2 1 Cost (Kip) 10,000 40,050 35,000 10,000 200,000 50,000 30,000 144,000 300,000 Total 20,000 80,100 70,000 10,000 200,000 50,000 30,000 288,000 300,000 Kip 1,048,000

If 100,000 fry are successfully produced from this system then the expected income would be approximately 2,000,000 Kip and the break-even production of fish fry is 61,248 pieces. Even with a 50% reduction of fry price this operation could recover the investment after 2 harvests. Since at least four harvests are possible in this system, the potential profit is considerable. Since the operational costs are low relative to the income from the crop, successive crops break even at a production of only 8,848 fry. Such production levels can be easily achieved if attention is paid to management (especially avoiding predation) and feeding. Economics of Nursery Cage Holding Operation One of the problems of the hatcheries is that the holding of fry uses all the available nursery ponds. As the fry grow in the nursery ponds there are progressive losses and overall production deteriorates. This is because of predation and insufficient feeding. Also water quality deterioration may cause disease and mortalities. A suggested solution to this problem is to remove the fry from nursery ponds after they attain the size of 12 cm and then rear them intensively in cages until sale. This has the advantage that fish can be held in a

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cage and fed appropriately to their weight. The fish are also easy to catch when they are ready for sale. Also, loss by predation could be avoided. Such a cage system increases the intensity of the operation, but this must be accompanied by modified management techniques. Such cage culture operations require aeration or water movement and so the cages must be supplied with sufficient water exchange and if possible supplementary aeration. This system incurs additional costs for water exchange, aeration and feed. In cage culture, for effective feed management, a floating type feed should be used. This allows the farmer to assess how the fish are feeding. The fish can be stocked in a cage at about 1,500 pieces per cubic metre. In a 20 x 20 x 1.5m cage, 30,000 (1 2 cm) fry could be stocked. The sale value of these fry is approximately 600,000 Kip. Assuming 80% survival this would realize an income of 480,000 Kip. The rearing costs for fry are detailed below: Item Pellet feed Fuel for water pump Fuel for aerator Cost of fry Lime Labour Total Units 54 kg 60 litres 60 litres 30,000 50 kg 1 month Cost (Kip) 1,500 800 800 5 300 30,000 Total (Kip) 81,000 48,000 48,000 150,000 15,000 30,000 Kip 372,000

Since one pond would contain more than one cage (e.g. 4 6 cages), there are economies of scale related to water and aeration costs. This substantially reduces the production cost. This system will be tested at the Pak Bor hatchery in Savannakhet. If it proves successful the cage rearing system will be introduced in all hatcheries. This technique will allow 4 6 nursery ponds in each hatchery to be free for other uses. The rearing period being 3 4 weeks, each rearing cage can be used several times during each breeding season

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