Economic analysis of off-bottom oyster culture

Figures & data

Table 1. Production levels analyzed.

Lines (200 bags each)	Lease Size (Acres)	Oysters Planted	Expected Oyster Harvest
1	0.5	26,667–53,333	20,000–40,000
3	0.5	80,000–160,000	60,000–120,000
6	1	160,000–320,000	120,000–240,000
12	2	320,000–640,000	240,000–480,000
18	3	480,000–960,000	360,000–720,000
24	4	640,000–1,280,000	480,000–960,000

Figure 1. Estimated initial capital investment and annual cost.

Table 2. Alternative assumptions considered in five-year profit projections.

Mortality case	Stocking rate	Direct-sale price to grower
Best Case: No adverse mortality events; harvest is as expected every year	100	$0.50
Moderate Loss Case: 75% of a single year’s expected harvest is lost.	150	$0.75
Severe Loss Case: 100% of one year’s expected harvest is lost, and that, due to lingering effects (e.g., partial gear damage/loss, seed scarcity, farm closures or water quality issues), 50% of the following year’s expected harvest is also lost.	200	$1.00

Figure 2. Estimated Average Break-even Price for 150 oysters per bag, under Moderate Loss mortality case.

Figure 3. Estimated Average Annual Profit by Scenario, 26,667–160,000 Oysters Planted (0.5 Acre, 1–3 Lines).

Figure 4. Estimated Average Annual Profit by Scenario, 160,000–640,000 Oysters Planted (1–2 Acres).

Figure 5. Estimated Average Annual Profit by Scenario, 480,000–1,280,000 Oysters Planted (3–4 Acres).

Table 3. Estimated mean profit, break-even price, and relative changes for dockside-to-wholesaler scenario relative to direct-sale.

	Mean Profit ($0.50 per oyster)			Break-Even Price
Lines	Direct-Sale	Dockside-to-Wholesaler	% Change	Direct-Sale	Dockside-to-Wholesaler	% Change
1	−$41,823	−$32,464	22%	$2.57	$2.10	−18%
3	−$50,268	−$39,014	22%	$1.31	$1.13	−14%
6	−$53,921	−$39,697	26%	$0.92	$0.81	−12%
12	−$56,462	−$34,983	38%	$0.71	$0.62	−13%
18	−$37,533	−$12,613	66%	$0.58	$0.51	−12%
24	−$22,176	$6,900	131%	$0.52	$0.46	−12%

Figure A1. Annual cost by cost category for four production levels.

Figure A2. Estimated average break-even price for 100, 150, and 200 oysters per bag, under Best (Top), Moderate Loss (Center), and Severe Loss (Bottom) mortality cases.

Table A1. Summary of key production assumptions.

Assumption	Value
Gear Type	Floating bags
Floating bag lines (lease size in acres)	1 (0.5 acre), 3 (0.5 acre), 5 (1 acre), 10 (2 acres), 15 (3 acres), 20 (4 acres)
Floating bags per line	200
Market-size oysters per bag	100, 150, 200
Expected seed mortality from planting to harvest (R6)	25%
Seed price ($ per 1,000, R6)	$28.75
Hourly wage, supervisory labor	$20.00
Hourly wage, general labor	$12.50
Fuel price per gallon (gasoline)	$3.20
Boat motor horsepower	50
Motor fuel use, gallons per hour	HP/10 = 5
Motor running hours, as % of labor hours	10%
One-way travel distance in miles, home to dock (Thibodaux to Grand Isle)	81
One-way travel distance in miles, dock to delivery (Grand Isle to New Orleans)	107
Delivery travel days per week / weeks per year	1/52
Oyster culture park lease rent, dollars per acre per year	$1,000
General liability insurance, dollars per acre per year	$1,000
Retail container cost, dollars per 100-count container	$1.00
Marketing/promotion cost, dollars per year	$2,500
Expected price per oyster	$0.50, $0.75, $1.00
Interest rate on loans	11.75%

Table A2. Estimated capital costs and annual depreciation for one line of floating bags.

	Quantity	Cost Per Unit	Tax & Shipping	Total Cost	Useful Life (Years)	Salvage Value	% Dedicated	Annual Depreciation
Boat, Motor, Truck, Trailer
Boat, Motor (50 HP), Trailer	1	$20,000.00	0.0%	$20,000	10	$2,500	100%	$1,750
Truck	1	$25,000.00	0.0%	$25,000	10	$2,500	100%	$2,250
Gear, Floating Bag System
Sleeve, 2 mm mesh, 1.5 mL (R2 seed)	0	$6.75	24.2%	$0	4	$0	100%	$0
Bags, 4 mm mesh, 2 mL (R4 seed)	0	$7.00	24.2%	$0	4	$0	100%	$0
Bags, 6 mm mesh, 4.5 mL (R6 seed)	25	$22.00	24.2%	$683	4	$0	100%	$171
Bags, 12 mm, 9.5 mL (R12 seed)	200	$22.00	24.2%	$5,465	4	$0	100%	$1,366
Bag Closures	450	$0.034	24.2%	$19.00	4	$0	100%	$5
Screw Anchors	2	$39.00	24.2%	$97	4	$0	100%	$24
Floating Buoys	2	$40.00	24.2%	$99	4	$0	100%	$25
Anchor Lines, 300'	1	$54.49	24.2%	$68	4	$0	100%	$17
Other Equipment
Truck Refrigeration Unit	1	$3,600.00	24.2%	$4,471	5	$0	100%	$894
Powerwasher	1	$300.00	24.2%	$373	5	$0	100%	$75
Harvest Baskets	2	$35.00	24.2%	$87	5	$0	100%	$17
Other Costs
HACCP Training	1	$390.00	0.0%	$390	5	$0	100%	$78
Contingency				$625	5			$125
Total Boat, Motor, Truck, Trailer Cost				$45,000				$4,000
Total Farm Gear Cost				$6,431				$1,608
Total Other Equipment Cost				$4,931				$986
Total Other Cost				$1,015				$203
Grand Total				$57,377				$6,797

Table A3. Estimated labor hours required, based on number of oysters planted.

Oysters Planted Range		Full-time hours	Part-time hours	Total hours	Days per Week (Full-Time Equivalent 8-Hour Day)
1	100,000	0	960	960	2.3
100,001	200,000	2,080	0	2,080	5.0
200,001	300,000	2,080	960	3,040	7.3
300,001	400,000	2,080	1,920	4,000	9.6
400,001	700,000	4,160	960	5,120	12.3
700,001	800,000	4,160	2,000	6,160	14.8
800,001	1,000,000	6,240	960	7,200	17.3
1,000,001	1,500,000	6,240	3,840	10,080	24.2
1,500,001	2,000,000	6,240	5,760	12,000	28.8

Source: Hudson et al. (2013).

Hudson, K., Kauffman, D., & Murray, T. J. (2013). Cultchless (Single-Seed) oyster crop budgets for Virginia: 2013 User manual. Publication AAEC-40P, Virginia Cooperative Extension, Virginia Tech and Virginia State University. https://ncseagrant.ncsu.edu/wp-content/uploads/2019/09/L10_Budget-Tool_User-Manual.pdf.

 Google Scholar