• TABLE OF CONTENTS
HIDE
 Description of operations
 Economic assumptions
 Economic Analysis
 Conclusion
 Tables 1-10






Group Title: Circular - Florida Cooperative Extension Service - 1167
Title: Economic considerations of Golden Shiner production in Florida
CITATION PAGE IMAGE ZOOMABLE PAGE TEXT
Full Citation
STANDARD VIEW MARC VIEW
Permanent Link: http://ufdc.ufl.edu/UF00014482/00001
 Material Information
Title: Economic considerations of Golden Shiner production in Florida
Series Title: Circular
Physical Description: 16 p. : ill. ; 28 cm.
Language: English
Creator: Lazur, Andrew M ( Andrew Martin ), 1956-
Zimet, David J
Florida Cooperative Extension Service
Publisher: University of Florida, Cooperative Extension Service, Institute of Food and Agricultural Sciences
Place of Publication: Gainesville Fla
Publication Date: [1996]
 Subjects
Subject: Cyprinidae -- Florida   ( lcsh )
Fish culture -- Economic aspects -- Florida   ( lcsh )
Baitfish -- Florida   ( lcsh )
Genre: government publication (state, provincial, terriorial, dependent)   ( marcgt )
non-fiction   ( marcgt )
 Notes
Statement of Responsibility: Andrew M. Lazur and David J. Zimet.
General Note: Title from caption.
Funding: Circular (Florida Cooperative Extension Service) ;
 Record Information
Bibliographic ID: UF00014482
Volume ID: VID00001
Source Institution: Marston Science Library, George A. Smathers Libraries, University of Florida
Holding Location: Florida Agricultural Experiment Station, Florida Cooperative Extension Service, Florida Department of Agriculture and Consumer Services, and the Engineering and Industrial Experiment Station; Institute for Food and Agricultural Services (IFAS), University of Florida
Rights Management: All rights reserved, Board of Trustees of the University of Florida
Resource Identifier: aleph - 002107297
oclc - 35278976
notis - AKU6726

Table of Contents
    Description of operations
        Page 1
    Economic assumptions
        Page 2
    Economic Analysis
        Page 3
    Conclusion
        Page 4
        Page 5
        Page 6
    Tables 1-10
        Page 7
        Page 8
        Page 9
        Page 10
        Page 11
        Page 12
        Page 13
        Page 14
        Page 15
        Page 16
Full Text
/O/



-~ UNIVERSITY OF

FLORIDA


Circular 1167


Cooperative Extension Service
Institute of Food and Agricultural Sciences


Economic Considerations of Golden Shiner Production in
Florida'

Andrew M. Lazur and David J. Zimet2


Recreational freshwater fishing in Florida is
estimated to be a one billion dollar business annually
(1994-95 Florida Freshwater Sport Fishing Guide
and Regulation Summary, Florida Game and Fresh-
water Fish Commission); a significant portion of this
revenue results from live bait sales. Live bait is
preferred by many fishermen for catching several
species including crappie and largemouth bass. The
most popular bait for bass fishing is the golden
shiner which is supplied from aquaculture pro-
duction. The majority of baitfish production is
located in the Mississippi Delta region. Arkansas
leads the country in golden shiner production with
21,000 acres. Golden shiner production in Florida is
a potential alternative crop for aquaculture farms.
The economics of golden shiner production has
been reviewed for large operations, but no infor-
mation on small farm production is available. Florida
fish farms average under 10 acres, considerably
smaller when compared to several hundred acres in
the Mississippi delta regions of Arkansas and Missis-
sippi. Most Florida foodfish operations that have
recently diversified into baitfish production utilize
small 0.25-to 1.0-acre ponds whereas most ponds on
large farms in other states are 10-20 acres in size.
Small farms are unique and experience specific eco-
nomic challenges due to their size. Prospective bait
producers must be aware of these challenges prior to
investing in this business. This publication presents
an overview of important economic considerations,
including construction, equipment and operating
costs of small operations in Florida.


1. This document is Circular 1167, a publication of the Department
University of Florida. Publication date: June 1996.


DESCRIPTION OF OPERATIONS
Although the demand for golden shiners is high
in Florida and the potential for production is
attractive, existing and prospective fish producers
will move slowly with small shiner production
operations. This is due to the relatively high
investment cost of aquaculture, the need for
developing the necessary farming expertise and the
recognition of the potential problem of oversupply.
This is a wise business approach. To present the
requirements and economic potential of golden
shiner production, operations of two sizes typical of
existing farms in Florida are presented.
Attention to pond design and construction
specifications are important and have direct
implications on facility cost and management.
Utilizing small levee ponds offers greater
management intensity with potentially higher yields,
but are more expensive to construct per acre due to
a greater number of aerators, water supply and drain
lines and greater volume of soil moving compared to
larger ponds.
Two operations are demonstrated in this report:
a 5.5-acre operation consisting of five 1.0-acre ponds
and two 0.25-acre broodstock ponds; and a 22-acre
operation consisting of eight 2.5-acre ponds and four
0.5-acre broodstock ponds. The ratio of growout
pond acreage to broodstock pond acreage is 10:1 and
is consistent with the egg transfer method of golden
shiner production. Broodstock are stocked and
encouraged to spawn on artificial mats with the egg
transfer method. The mats with eggs are transferred


of Fisheries and Aquatic Sciences, Institute of Food and Agricultural Sciences,


2. Andrew M. Lazur, assistant professor and Extension Aquaculture Specialist; David J. Zimet, associate professor, Food Resource and Economics
Department, Cooperative Extension Service, Institute of Food and Agricultural Sciences, University of Florida, Gainesville FL 32611.
The Institute of Food and Agricultural Sciences is an equal opportunity/affirmative action employer authorized to provide research,
educational information and other services only to individuals and institutions that function without regard to race, color, sex, age, handicap,
or national origin. For information on obtaining other extension publications, contact your county Cooperative Extension Service office.
Florida Cooperative Extension Service / Institute of Food and Agricultural Sciences / University of Florida / Christine Taylor Stephens, Dean







Economic Considerations of Golden Shiner Production in Florida


(0!
to growout ponds where the eggs hatch and the fish
/"- are fed until harvest.
S01 o I7 Pond Construction and Installations

SCIENCE
LIBRARY All pond construction follows Soil Conservation
Service design criteria including: 16-foot top widths,
3:1 levee slopes, 6-foot levee height with 1 foot of
freeboard allowing a 5-foot water depth, and an 8-
inch drain. An average charge of $1.00 per cubic
yard is used for earth-moving costs which reflects
common charges for motor- or tractor-pulled pans
(Figure 1). The use of pans is recommended to
ensure necessary soil compaction. They are also
more efficient in moving soil than bulldozers. A
grass cover and gravel on levees to control erosion
and to allow all-weather access to ponds for feeding
and harvesting purposes are recommended. A
detention pond for temporary holding of pond
effluent is included in the 22-acre operation as
required by the Florida Department of
Environmental Protection (DEP) General Fish Farm
Permit. The 5.5-acre operation does not require a
permit since it does not exceed the 10,000 pounds
per year and 10 acres criteria as stated in the 1994
DEP general permit rule. Pond construction costs
for the 5.5-and 22-acre operations are presented in
tables 1 and 2.
A water well and supply lines are required for
successful golden shiner production (Figure 2).
Water is required for pond flooding and replenishing
water loss from evaporation and seepage. Well water
is necessary for the holding and grading tank facility.
Water supply and drain lines should be constructed
from PVC plastic pipe. A 6-inch well is
recommended for the 5.5-acre operation to supply
ponds and holding tanks. The 22-acre operation
utilizes an 8-inch well.
Electrical supply lines for both operations include
a main distribution panel and underground electrical
lines to ponds for the aerators. One main panel box
with individual aerator timers is used for the 5.5-acre
operation. The 22-acre operation utilizes four main
panel boxes with timers and breakers.

Equipment and Operations


The necessary production equipment for the two
operations is listed in tables 1 and 2. A fish
holding/grading tank facility is essential for any size
shiner production operation. Golden shiners are
delicate fish and do not respond well to handling. It
is necessary for shiners to be "cured" prior to
marketing. After the fish are harvested from ponds
(Figure 3), they are transferred into the holding
tanks. Curing, also known as hardening, refers to


holding fish in cool well water for a minimum of 2-3
days which allows fish to become acclimated to
lower water temperatures; this reduces fish
respiration and stress levels. Salt is usually added to
the water to reduce stress and promote the
protective mucus layer. Purging further reduces the
fishes demand for oxygen. The end result of the
curing process is a hardier and higher quality fish
that can better tolerate handling. The holding tank
facility (Figure 4) consists of a pole barn, concrete
tanks, regenerative blower for aeration, air and
water supply and drain lines and grading bars. Two
4'x15'x3' tanks are included in the 5.5-acre
operation and four tanks for the 22-acre operation.
Ownership of a truck and tractor is assumed, and
it is estimated half of the cost and use will be
designated to the shiner production operation. A %-
ton truck is recommended for delivery of fish and
for hauling other heavy loads. Both budgets include
the necessary aeration, feeding, water quality
monitoring and harvesting equipment. A small
enclosure in the pole shed for feed storage and
manual feeding is used in the 5.5-acre operation.
The 22-acre operation utilizes a larger feed storage
shed requiring air-conditioning to reduce feed quality
degradation due to heat and humidity. A 500-pound
capacity feed blower is included in the 22-acre
operation to assist in feeding the 2.5-acre ponds.
The expected life, investment, and depreciation costs
of equipment are presented in table 3.

ECONOMIC ASSUMPTIONS

The construction and equipment cost estimates
and enterprise budgets presented in this publication
are based on the following assumptions:

* Land is previously owned and not included in
capital investment.
* Land has a suitable clay soil and elevation for
pond construction.
* Suitable quality and quantity of well water is
available at normal depths.
* Electrical power lines are near farm location.
* Interest rate for construction and equipment is
8% of average investment which is calculated at
one half of the cost. Interest rate for operating
capital is 1% per month for 9 months on taxes
and insurance and all variable costs except labor
and marketing costs.
* Bagged feed at $300/ton is used.
* Adult shiners for broodstock are stocked at 500
lb/acre and cost $3.50/lb. There is a one-time
charge for broodstock. In all instances other
than the initial stocking, current broodstock is
sold and the proceeds are used to purchase new


Page 2







Economic Considerations of Golden Shiner Production in Florida


broodstock. Because there is no net effect, the
latter exchanges are not included in the budgets.
* Fertilizer costs include organic fertilizers, cotton
seed and alfalfa meal, and an inorganic, liquid
phosphorus (10-34-0) fertilizer.
* A 2:1 feed conversion is used to estimate feed
requirements.
* Chemical costs include two pond treatments for
parasite infections.
* Electricity cost is based on operating the well to
fill ponds twice per year and for an average
aerator use of 8 hr/day for 180 days. The
kilowatt charge used is $0.07 per kilowatt hour.
* Taxes and insurance are calculated as 2.5% of
half of the equipment and construction costs.
* Owner/operator labor is charged in the
enterprise budgets, but excluded from the cash
flow analyses. The charge in the enterprise
budget is made to indicate that even though no
cash is expended, unpaid labor is not completely
free and that some other use could be made of
the time spent on the golden shiner operation.
Part-time labor to assist owner in harvesting and
feeding is included for both operations.
* Since golden shiners can be heavily preyed upon
by wading birds, costs for typical bird scaring or
pyrotechnic supplies are included.
* The majority of golden shiners are sold during
the fall to spring months. Since fish size varies at
harvest, sub-marketable-size fish can be stocked
into other ponds and fed until marketable size is
reached. All fish are sold to wholesalers or
distributors.
* Fish income in enterprise budgets is based on a
$3.25/lb FOB farm or pondbank price. 1995
pondbank prices in North Florida ranged from
$3.00-3.50/lb.
* A yield of 1600 lb/acre is used for the 5.5-acre
operation and 1200 lb/acre for the 22-acre
operation. Average yields of 1850 lb/acre have
been achieved in small ponds in north Florida.
In an effort to be conservative, a slightly lower
yield is used for the 5.5-acre operation. A lower
yield is used for the 22-acre operation due to the
larger size ponds and reduced management
control. Some large ponds have achieved a yield
of 1200 lb/acre.


ECONOMIC ANALYSIS

Enterprise Budgets
Enterprise or annual production budgets for both
operations are presented in tables 4 and 5. These
budgets include a column for the reader to enter
actual costs because these costs will be farm specific.
Variable, fixed and total costs are included. Fixed
costs are costs required and independent of the level


of production and include: interest on construction
and equipment, taxes, insurance and permit fees, and
depreciation. Depreciation is a common business
cost and involves an annual charge for the original
cost of the item divided by its useful life. Breakeven
price per pound, net return to owner and net return
per acre are presented to allow for comparison to
other fish crops.
Both operations show a positive profitability with
the assumptions presented in this analysis. Net
return per acre for the 22-acre operation is about
120% greater than for the 5.5-acre operation.
Generally larger operations are more efficient than
smaller ones because larger ones spread the capital
investment costs over greater production volumes.
The breakeven prices per pound are $2.93 for the
5.5-acre operation and $2.28 for the 22-acre
operation. In the assumptions of this analysis, a 400
pound per acre reduction in yield for the 22-acre
operation compared to the 5.5-acre operation is used
to reflect observations of large pond production.
Had the same yield been used, the difference of
breakeven price values would have been even
greater. Because the enterprise budgets presented
represent only one set of assumptions, a sensitivity
analysis is necessary to investigate other possible
assumptions or conditions which can affect
enterprise profitability.

Cash Flow Analysis
New Operations
Sixteen-year cash flows for each of the start-up
operations are presented in tables 6 and 7. A time
frame of sixteen years was selected because it
encompasses the seven-year loan payment period
and two major replacement/depreciation cycles after
the loan is repaid. Because of the limited income
caused by its size, the 5.5-acre operation does not
exhibit a positive cumulative cash flow until Year 10,
two years after the loan is fully repaid. It barely
breaks even at that point. The annual situation is
quite different. In all years but three, annual returns
are positive. Returns are negative in only one year
after full production is attained. In that year, Year 6,
a major replacement is projected, and the operation
does not generate enough cash to meet the need.
The 22-acre operation exhibits a different
outcome. The 22-acre operation has a positive
cumulative cash flow starting in Year 5 and a
positive annual cash flow starting in Year 3. It is
only in the first two years, before full production is
attained, that the annual cash flows are negative.
Enough cash is generated to withstand the major
replacement of Year 6. In most years after the loan
is repaid, about $2,000 in cash is generated per acre.
Golden shiner production is profitable for both
size operations (Tables 4 and 5). The cash flow


UNIVERSITY OF FLORIDA LIBRARIES


Page 3







Economic Considerations of Golden Shiner Production in Florida


projections (Tables 6 and 7) reveal that there is a
substantial time lag between start-up and positive
cumulative cash flow, especially for the 5.5-acre
operation. Many prospective producers already have
made large investments to develop ponds for some
other type of aquaculture enterprise.

Existing Operations
Cash flow projections of golden shiner production
for producers with existing ponds are presented in
tables 8 and 9. It is assumed that they have on hand
almost all the machinery and equipment to run a
golden shiner operation. The only purchases or
construction that are necessary are those for the
breeding and production of baitfish. It is assumed
that they already have a feed storage shed but lack
the fish holding tanks.
The purchase or construction of new equipment
and installations for the 5.5-acre operation totals
almost $11,000; $24,000 for the 22-acre operation. It
is also assumed that, in the first year, a loan
payment for the existing installation and equipment
will have to be made. In the case of the 5.5-acre
operation the payment of the old loan amounts to
$4,700. It amounts to $15,600 for the 22-acre
operation. The terms of the loans are the same as
those for a new operation (70% of cost for 7 years
at 8%).
Cash flow projections for the operations with
existing ponds are favorable. As before, annual cash
flows are negative only for the first year. Cumulative
cash flow for the 5.5-acre operation is projected to
be negative through two years (compared to nine
years for the new operation). For the 22-acre
operation the projection is also negative through two
years (compared to four years for the new
operation).

Sensitivity Analysis

Many factors or inputs can influence business
profitability. By nature, fish production can be a
risky business which involves the potential of
reduced yields due to poor water quality, fish disease
and predation. To more completely evaluate the
profitability of the 22-acre operation, three
assumptions were varied. The effects of the changes
on net return per acre are presented in table 10. In
the sensitivity analysis, interest rates varied from 8 to
15%, yield varied from 800 to 1600 pound per acre
and selling price varied from $2.75 to $3.75 per
pound. These variations reflect occurrences that
might be expected in baitfish production in Florida.
The lowest net return per acre is -$628 and the
highest is $2,846. The variation in yield had the
greatest effect on net return per acre. Using an 800
pound per acre yield resulted in a loss at a selling
price per pound of $2.75, $3.00 or $3.25. Returns


were also negative at the two higher interest rates
with a price of $3.25 and yield of 800 pounds. Using
the same yield, but higher selling prices of $3.50 and
$3.75 showed a positive net return per acre.
However, the profit margin at $3.50 might not be
enough to warrant the high investment costs. Using
a 1200 or 1600 pound per acre yield at all five
selling prices resulted in attractive returns. This
demonstrates the impact that good pond
management has on fish yield and enterprise
profitability. Lastly, it should be noted that variation
of interest rates had the least effect on return.

CONCLUSION
The net return per acre and breakeven estimates
presented in this analysis indicate that small-scale
golden shiner production in Florida can be a
profitable alternative for aquaculture producers.
Compared to small-scale production of catfish for
wholesale markets, golden shiner production offers
greater potential returns. The cash flow projections
for operations with pre-existing ponds and
equipment indicate that producers who had difficulty
earning positive returns from catfish production
could generate greater returns and a positive cash
flow from golden shiner production.
The cost of pond construction and equipment,
$14,604 and $7,374per acre for the 5.5-and 22-acre
operations, respectively requires a large financial
commitment. These costs are specific to the
conditions listed in this report and serve only as a
guide. It is essential that prospective bait producers
investigate their specific costs prior to investing. To
improve farm profits and offset the high investment
costs, gearing production towards larger fish which
can sell for higher prices might be a sound strategy
for Florida producers. In addition to financial
considerations, baitfish production requires time and
education. Prior to investment, the farmer must
learn the necessary management skills. Attention to
water quality, nutrition and predator management
will greatly reduce risk and influence farm profits.
Proper pond design, construction, and an adequate
fish holding facility are critical to producing baitfish.
Identifying the local market conditions is essential
to success. Prospective buyers will want to determine
if new shiner producers can meet their needs of
consistent quality and quantity. Understanding the
many factors of the bait market including the
seasonality of demand, fish size preferences and
individual wholesaler requirements, will assist the
farmer in developing a business plan and production
operation.


Page 4







Economic Considerations of Golden Shiner Production in Florida


Figure 1. Dirt moving with motor-driven or tractor-pulled pans is recommended in most
soils. Dirt moving costs make up about 60% of total pond construction.


Figure 2. Each pond should have a well water supply system and an efficient aeration
device.


Page 5







Economic Considerations of Golden Shiner Production in Florida


Figure 3. Smaller ponds can be easily harvested using seines with a minimum of labor.


Figure 4. Adequate holding and grading tank facilities are a must for proper handling and
marketing of golden shiners.


Page 6







Economic Considerations of Golden Shiner Production in Florida


Table 1. Pond construction and equipment costs for a 5.5-acre golden shiner production operation. Includes
five 1.0-acre growout and two 0.25-acre brood ponds.

Item Cost/Unit Quantity Cost Your Cost

Pond Construction ,27-,16t f,
Earth moving (cubic yards) $ 1 27,000 $ 27,000 $

Well (6 inch) 1 7,000
Water supply line 1,600 %
Electrical supply line 2,000 Tr%
Drainage systems 6 2,400 *.56
Gravel and grass cover 960 7'7.
Construction Total $40,960 $

Equipment
20' x 15' pole shed 1 $ 700 $
4' x 16' x 3' holding/grading tank 2 1,400
Tank facility supplies 1,200

3/4-ton truck (50% allocation) $ 17,000 8,500
50 hp tractor (50% allocation) 16,000 8,000
Mower 1,500 1 1,500
Electric paddlewheel aerator: 1 hp 1,300 2 "5 6,500 5 3 .
Electric pump sprayer aerator: 0.75 hp 700 k 2 1,400
Seine (200' x 8' deep) 1,600 1 1,600
Seine reel 2,200 1 2,200
Feed storage enclosure 500 1 500
Fish hauling tank 1,200 1 1,200
Boat with motor 1,500 1 1,500
Oxygen meter and water quality test kit 1,150 1 1,150
Egg mats 5 150 750
Dip nets, waders and bird control supplies 785
Broodstock (pounds) 3.50 250 875
Equipment Total $39,360 $
TOTAL $80,320 $
Total Cost/Acre $14,604 $


Page 7







Economic Considerations of Golden Shiner Production in Florida


Table 2. Pond construction and equipment costs for a 22-acre golden shiner production operation. Includes
eight 2.5-acre growout and four 0.5-acre brood ponds.

Item Cost/Unit Quantity Cost Your Cost

Pond Construction

Earth moving (cubic yards) $ 1 66,500 $ 66,500 $

Well (8 inch) 1 11,000

Water supply line 3,600

Electrical supply line 3,800

Drainage systems (12) and detention pond 9,800

Gravel and grass cover 3,600

Construction Total $98,300

Equipment

20' x 25' pole shed 1 $ 1,000 $

4' x 16' x 3' holding/grading tank 4 2,500

Tank facility supplies 1,800

3/4 ton truck (50% allocation) $ 17,000 8,500

50 hp tractor (50% allocation) 16,000 8,000

Mower 1,500 1 1,500
Electric paddlewheel aerator: 2 hp 2,000 8 16,000

Electric pump sprayer aerator: 0.75 hp 700 4 2,800

Seine (300' x 8' deep) 1,800 1 1,800

Seine reel 2,200 1 2,200

15' x 20' feed storage shed 2,500 1 2,500

500-pound feed blower 3,200 1 3,200

Fish hauling tank 1,200 1 1,200

Boat with motor 1,500 1 1,500

Oxygen meter and water quality test kit 1,150 1 1,150

Egg mats 5 600 3,000

Dip nets, waders and bird control supplies 1,785

Broodstock (pounds) 3.5 1,000 3,500
Equipment Total $63,935 $

TOTAL $162,235 $

Total Cost/Acre $7,374 $


Page 8








Economic Considerations of Golden Shiner Production in Florida


Table 3. Initial investment and annual depreciation costs for the 5.5 and 22-acre golden
shiner production operations.

Item Useful life Investment Depreciation
years dollars dollars

Ponds 20 5% of new

Well and pump

6" and 200 gpm 20 7,000 350


S8" and 350 gpm


11,000


Tank facility1 20 5% of new

50 hp tractor (50%) 15 8,000 535

Truck (50% allocation) 5 8,500 1700

Mower 10 1,500 150

Paddlewheel aerator

1 hp 10 1,300 130
2 hp 10 2,000 200

Sprayer aerator 5 700 140

Feed blower 10 3,200 320

Feed storage shed 10 10% of new
Boat with motor 10 1,500 150

Fish hauling tank 10 1,200 120

Seine 5 20% of new

Seine reel 10 2,200 220

Oxygen meter 5 900 180
Water quality kit 5 250 50
Dip net 5 25 5

Waders 2 70 35

Bird control supplies 5 20% of new

Egg mats 2 5 2.50

Broodstock 2 3.50 0

1 Tank facility consists of pole shed and holding tanks as described in the description of operations section.


Page 9








Economic Considerations of Golden Shiner Production in Florida


Table 4. Estimated annual costs and returns for a 5.5-acre golden shiner production operation.

Item and Unit Quantity Price Cost or Value Your Cost
dollars dollars dollars

1. Gross Receipts, pounds 8,000 3.25 26,000
2. Variable Costs

Feed, tons 8 300 2,400
Fertilizer 250

Electricity, KwH 28,571 0.07 2,000

Fuel, gallons 250 1 250

Repairs and maintenance 750
Chemicals 750

Miscellaneous supplies 400

Family labor, hours1 600 5.00 3,000

Hired labor, hours 400 5.00 2,000

Interest on operating capital2 7796 9% 702
Total Variable Costs 12,502

3. Fixed Costs
Capital charges on construction, equipment and initial broodstock3 3,189

Taxes and insurance 997

Depreciation4 6,763

Total Fixed Costs 10,949

4. Total Costs 23,451
5. Breakeven price/pound 2.93

6. Net return to owner and land5 2,549

7. Net return/acre 463

1Although family labor is unpaid, a reasonable charge for its time is included in the enterprise budget. There is no
corresponding charge made in the cash flow estimates.
2 Includes interest on all variable costs except for hired and family labor plus interest on taxes and insurance.
3 Capital charges are calculated as 8% of average investment of construction, equipment and initial broodstock. Average
investment equals to one-half the cost of each item included in these groupings.
4 Broodstock is excluded from depreciation calculations.
5 Return is to owner and land because no land charge is included in the budget.


Page 10







Economic Considerations of Golden Shiner Production in Florida


Table 5. Estimated annual costs and returns for a 22-acre golden shiner production operation.

Item and Unit Quantity Price Cost or Value Your Cost
dollars dollars dollars

1. Gross Receipts, pounds 24,000 3.25 78,000
2. Variable Costs

Feed, tons 24 300 7,200
Fertilizer 700
Electricity, KwH 50,000 0.07 3,500
Fuel, gallons 600 1 600
Repairs and maintenance 2,000
Chemicals 3,000
Miscellaneous supplies 700
Family labor, hours1 1,000 5.00 5,000
Hired labor, hours 2,000 5.00 10,000
Interest on operating capital2 19,717 9% 1,775
Total Variable Costs 34,475
3. Fixed Costs

Capital charges on construction and equipment and broodstock3 6,453
Taxes and insurance 2,017
Depreciation4 11,775
Total Fixed Costs 20,245
4. Total Costs 54,720
5. Breakeven price/pound 2.28
6. Net return to owner and land5 23,280
7. Net return/acre 1,058

1 Although family labor is unpaid, a reasonable charge for its time is included in the enterprise budget. There is no
corresponding charge made in the cash flow estimates.
2 Includes interest on all variable costs except for hired and family labor plus interest on taxes and insurance.
3 Capital charges are calculated as 8% of average investment of construction, equipment, and initial broodstock. Average
investment equals one-half the cost of each item included in the groupings.
4 Broodstock is excluded from depreciation calculations.
5 Return is to owner and land because no land charge is included in the budget.


Page 11








Economic Considerations of Golden Shiner Production in Florida


Table 6. Sixteen-year annual and cumulative cash flow for 5.5-acre golden shiner operation, producing 8,000 pounds
sold at $3.25 per pound.

Income and Expenses Cash Flow
Year in dollars
Income Initial Operating Loan Replace- Annual Cumu-
Investment Costs3 Payment4 meant5 lative

1 56,2241 80,320 0 0 0 -24,096 -24,096
2 15,6002 10,597 10,799 0 -5,796 -29,892
3 26,000 10,597 10,799 820 3,874 -26,108

4 26,000 10,597 10,799 0 4,604 -21,503
5 26,000 10,597 10,799 820 3,874 -17,719
6 26,000 10,597 10,799 13,135 -8,531 -26,250

7 26,000 10,597 10,799 820 3,874 -22,466
8 26,000 10,597 10,799 0 4,604 -17,861
9 26,000 10,597 820 14,583 -3,278
10 26,000 10,597 0 15,403 12.125

11 26,000 10,597 13,955 1,448 13,574
12 26,000 10,597 11,700 3,703 17,277
13 26,000 10,597 820 14,583 31,860

14 26,000 10,597 0 15,403 47,264
15 26,000 10,597 820 14,583 61,847

16 26,000 10,597 13,135 2,268 64,115

1 This sum is the amount of the loan (70% of $79,720).
2 This sum is 60% of income from full production.
3 This value includes all operating costs from Table 4 minus family labor and adding cost of insurance.
4 Loan payment is based on the amount of the loan financed at 8% for seven years.
5 The values in this column are consistent with the years of economic life displayed in Table 3.


Page 12







Economic Considerations of Golden Shiner Production in Florida


Table 7. Sixteen-year annual and cumulative cash flow for 22-acre operation, producing 24,000 pounds sold
at $3.25 per pound.

Income and Expenses Cash Flow
Year in dollars

Income Initial Operating Loan Replace- Annual Cumu-
Investment Costs3 Payment4 ment5 lative

1 113,5651 162,235 0 0 0 -48,671 -48,671
2 46,8002 31,686 21,813 0 -6,699 -55,369

3 78,000 31,686 21,813 2,210 22,291 -33,078

4 78,000 31,686 21,813 0 24,501 -8,576
5 78,000 31,686 21,813 2,210 22,291 13,715
6 78,000 31,686 21,813 13,675 10,826 24,542

7 78,000 31,686 21,813 2,210 22,291 46,833

8 78,000 31,686 21,813 0 24,501 71,334

9 78,000 31,686 2,210 44,104 115,439
10 78,000 31,686 0 46,314 161,753
11 78,000 31,686 14,710 31,604 193,357
12 78,000 31,686 13,675 32,639 225,996
13 78,000 31,686 0 46,314 272,310

14 78,000 31,686 2,210 44,104 316,414

15 78,000 31,686 0 46,314 362,728
16 78,000 31,686 13,675 32,639 395,367

1 This sum is the amount of the loan (70% of $161,335).
2 This sum is 60% of income from full production.
3 This value includes all operating costs from Table 5 minus family labor and adding cost of insurance.
4 Loan payment is based on the loan amount financed at 8% for seven years.
5 The values in this column are consistent with the years of economic life displayed in Table 3.


Page 13







Economic Considerations of Golden Shiner Production in Florida


Table 8. Sixteen-year annual and cumulative cash flow for 5.5-acre operation with existing ponds and equipment
producing 8,000 pounds sold at $3.25 per pound.

Income and Expenses Cash Flow
Year in dollars

Income Initial Operating Loan Replace- Annual Cumu,
Investment Costs3 Payment ment5 lative

1 7,6021 10,860 0 4,7004 0 -7,958 -7,958

2 15,6002 10,597 1,561 0 3,442 -4,516
3 26,000 10,597 1,561 820 13,022 8,507

4 26,000 10,597 1,561 0 13,842 22,349
5 26,000 10,597 1,561 820 13,022 35,371

6 26,000 10,597 1,561 13,135 707 36,079

7 26,000 10,597 1,561 820 13,022 49,101

8 26,000 10,597 1,561 0 13,842 62,943
9 26,000 10,597 820 14,583 77,527
10 26,000 10,597 0 15,403 92,930

11 26,000 10,597 12,250 3,153 96,083
12 26,000 10,597 13,135 2,268 98,351
13 26,000 10,597 820 14,583 112,935

14 26,000 10,597 0 15,403 128,338

15 26,000 10,597 820 14,583 142,921
16 26,000 10,597 13,135 2,268 145,190

1 This sum is the amount of the loan (70% of $10,860).
2 This sum is 60% of income from full production.
3 This value includes all operating costs from table 4 minus family labor and adding cost of insurance.
4 The first year's loan payment covers the final year payment for the previous loan to construct ponds and purchase
machinery and equipment. Loan payments for years 2-8 are based on financing a loan of $10,860 for seven years at 8%.
5 The values in this column are consistent with the years of economic life in table 3.


Page 14







Economic Considerations of Golden Shiner Production in Florida


Table 9. Sixteen-year annual and cumulative cash flow for 22-acre operation with existing ponds and equipment producing
24,000 pounds sold at $3.25 per pound.

Income and Expenses Cash Flow
Year in dollars dollars

Income Initial Operating Loan Replace- Annual Cumulative
Investment Costs3 Payment ment5

1 16,4751 23,535 0 15,6004 0 -22,660 -22,660

2 46,8002 31,686 3,164 0 11,950 -10,710

3 78,000 31,686 3,164 2,210 40,940 30,229

4 78,000 31,686 3,164 0 43,150 73,379

5 78,000 31,686 3,164 2,210 40,940 114,319

6 78,000 31,686 3,164 13,675 29,475 143,794

7 78,000 31,686 3,164 2,210 40,940 184,733

8 78,000 31,686 3,164 0 43,150 227,883

9 78,000 31,686 2,210 44,104 271,987

10 78,000 31,686 0 46,314 318,301

11 78,000 31,686 14,710 31,604 349,905

12 78,000 31,686 13,675 32,639 382,544
13 78,000 31,686 0 46,314 428,858

14 78,000 31,686 2,210 44,104 472,962

15 78,000 31,686 0 46,314 519,276

16 78,000 31,686 13,675 32,639 551,915

1 This sum is the amount of the loan (70% of $23,535).
2 This sum is 60% of income from full production.
3 This value includes all operating costs from Table 5 minus family labor and adding cost of insurance.
4 The first year's loan payment covers the final year payment for the previous loan to construct the ponds and
purchase machinery and equipment. Loan payments for years 2-8 are based on a loan of $23,535 financed for seven
years at 8%.
5 The values in this column are consistent with the years of economic life displayed in Table 3.


Page 15







Economic Considerations of Golden Shiner Production in Florida


Table 10. Net return per acre for various selling prices, yields and interest rates.

Selling price per Yield Net return per acre in dollars
pound Ibs/acre based on three long term interest rates
dollars
8% rate 12% rate 15% rate

800 -370 -518 -628
2.75
1200 511 363 253

1600 1,392 1,244 1,134


800 -185 -336 -446
3.00
1200 783 636 526

1600 1,755 1,608 1,504


800 -7 -154 -264
3.25
1200 1,056 909 799

1600 2,119 1,971 1,861


800 175 27 -83
3.50
1200 1,329 1,181 1,068

1600 2,483 2,335 2,225


800 357 209 99
3.75
1200 1,602 1,454 1,344

1600 2,846 2,799 2,589


UTrV
11<7


Page 16




University of Florida Home Page
© 2004 - 2010 University of Florida George A. Smathers Libraries.
All rights reserved.

Acceptable Use, Copyright, and Disclaimer Statement
Last updated October 10, 2010 - - mvs