an assessment on aquaculture stewardship council (asc) ceritfication standard application for catfish (pangasianodon hyphopthalmus) farms in the mekong delta, vietnam

An assessment on Aquaculture Stewardship Council - ASC certification standard application for Tra catfish Pangasianodon hyphopthalmus farms in the Mekong Delta was conducted from June t

CAN THO UNIVERSITY COLLEGE OF AQUACULTURE AND FISHERIES

AN ASSESSMENT ON AQUACULTURE

STEWARDSHIP COUNCIL (ASC) CERITFICATION STANDARD APPLICATION FOR CATFISH

(Pangasianodon hyphopthalmus) FARMS IN THE

MEKONG DELTA, VIETNAM

NGUYEN THANH TOAN

A thesis submitted in partial fulfillment of the requirements for

the degree of Bachelor in Aquaculture

Supervisor

Dr TRUONG HOANG MINH

Can Tho, January 2013

ACKNOWLEDGEMENTS

I wish to express my deep appreciation and sincere gratitude to:

College of fisheries and aquaculture of Can Tho University created the useful conditions for studying

Lecturers of Can Tho University and Auburn University, AIT University have taught me the experience during school

Dr Truong Hoang Minh for his constant guidance and enthusiastically help during the thesis conducting time

The companies of VINH HOAN, NGOC HA, ANVIFISH, GODACO, SOHA, as well as cooperatives Thot Not and O Mon supplied the useful data for my thesis

Brothers and sisters from the postgraduate grade 18 have helped hospitably for analyzing data

Friends from Advanced Aquaculture batch 34 and Aquaculture Economic batch 35

My Family and relatives encouraged and created favorable conditions for

me to complete this program

Everyone always facilitated and enthusiastically helped me complete the thesis

Can Tho Jan, 25th 2013

Author

Nguyen Thanh Toan

An assessment on Aquaculture Stewardship Council - ASC certification

standard application for Tra catfish (Pangasianodon hyphopthalmus) farms in

the Mekong Delta was conducted from June to December 2012 in Can Thocity, Tien Giang, An Giang, Ben Tre, and Dong Thap provinces Thirty members in cooperatives of Thot Not and O Mon districts, Can Tho city and 5 companies (Vinh Hoan, Ngoc Ha, Godaco, Anvifish and Sohafood) were interviewed

The results showed that, ASC was a new standard, an independent not for profit organization, established in 2009 by WWF and IDH, its version 1 was published in October 2010 The ASC compliance related to 7 most concerned issues: legality, land and water use, waste management, genetic and biodiversity, feed management, drugs and chemicals and social responsibility

that promoted the sustainable development for Tra cafish culture in the future

Average farm size of farmers, cooperatives and companies were 1.41±1.52 ha; 0.95±0.56 ha and 14.10±5.06ha, respectively Fish farmers and cooperatives were limited size, technique and finance Moreover, ASC had specific criteria that were hard to be complied and high certification cost for farmers and cooperatives while they had small scales, ASC was not known well to individual farmers and member of cooperatives because of not much information available Return rate of the ASC model of companies was 8.82±5.76%, having significantly financial efficiency meanwhile it was -7.88±6.68% and -5.20±9.23% in farmers and cooperatives, respectively As a result, ASC application gave higher price and economic efficiency Among 5 companies interviewed and registered towards ASC certification, Vinh Hoan, Ngoc Ha and Anvifish companies were certified ASC in 2012 The application of ASC standard was important for building up the brand name of Vietnamese Tra catfish industry and meeting the demand of international customers as well as supporting sustainable Tra catfish production of the Mekong Delta in the future

Key words: ASC, certification, Mekong Delta, Tra catfish, standard

CONTENTS

ACKNOWLEDGEMENTS i

ABSTRACT ii

CONTENTS iii

LIST OF TABLE iv

LIST OF FIGURE v

LIST OF ABBRIVIATION vi

CHAPTER 1: INTRODUCTION 1

1.1 Background 1

1.2 Objectives 2

CHAPTER 2: LITERATURE REVIEWS 3

2.1 Review on Status of Tra catfish farming in Vietnam 3

2.2 Current standards and practices for Tra catfish farming in Mekong Delta 4 2.2.1 BMP 4

2.2.2 GAP 4

2.2.3 BAP 5

2.2.4 Organic Tra catfish farming 7

2.2.5 Viet GAP 7

CHAPTER 3: METHODS AND MATERIALS 9

3.1 Study area 9

3.2 Data collection 9

3.2.1 Secondary data 9

3.2.2 Primary data 9

3.2.3 Sample size 10

3.2.4 The list of main variables in questionnaire 10

CHAPTER 4: RESULTS AND DISCUSSIONS 12

4.1 The overview of the standard certification of ASC in Mekong Delta 12

4.2 The general information 12

4.3 The procedures of the standard certification of ASC 13

4.4 The technical status of Pangasius farms 14

4.4.1 Farming area 14

4.4.2 The information of Pangasius Seed 15

4.4.3 The water management in pond 16

4.4.4 The culturing time, harvest, yield, survival rate 17

4.5 The financial efficiency of farmer, cooperative and company 18

4.6 The perception of Pangasius farmer, cooperative and company 22

4.7 The assessment of the ASC criteria application of farms 23

4.8 Advantages and disadvantages of ASC standard application 24

4.8.1 Advantages 24

4.8.2 Disadvantages 25

Chapter 5: CONCLUSIONS AND RECOMMENDATIONS 27

5.1 Conclusions 27

5.2 Recommendations 27

REFERENCES 28 APPENDIX

LIST OF TABLES

Table 3.1: Number of surveyed farms 10

Table 3.2: The complex variables and single variables in the questionnaire

……… ……… 11

Table 4.1: General information of Pangasius farms (mean±std) 13

Table 4.2: Logo fee 14

Table 4.3: The aquaculture area of 3 different groups 15

Table 4.4: The information of Pangasius Seed 16

Table 4.5: The water exchange 17

Table 4.6: The culturing time, harvest, yield, survival rate 18

Table 4.7: The major economic indicators 19

Table 4.8: Perceptions of Pangasius farmer, cooperative and company 23 Table 4.9: The analysis of advantages and disadvantages of ASC standard Application……….26

LIST OF FIGURES

Figure 3.1: Map of the study areas 10

Figure 4.1: Procedures of the standard certification of ASC 13

Figure 4.2: Logo 14

Figure 4.3: Rate of return (%) and Benefit – cost rate (time) 20

Figure 4.4: Structures of production cost of Farmer, Cooperative and Company 21

LIST OF ABBRIVIATION

ACC Aquaculture Certification Council

ASC Aquaculture Stewardship Council

ASEAN Association of Southeast Asian Nations

BAP Best Aquaculture Practices

BMP Better management practices

CAB Conformity Assessment Body

CoC Code of Conduct for responsible Aquaculture

CUVN Control Union Vietnam

DARD Department of Agriculture and Rural Development

FAO Food and Agriculture Organization

FIS Fish Information and Services

GAA Global Aquaculture Alliance

GAP Good Aquaculture Practices

GMOs Genetically modified Objectives

HACCP Hazard Analysis and Critical Control Points

IDH Dutch Sustainable Trade Initiative

IQF Individual Quick Frozen

ISO International Organization for Standardization

MPEDA The Marine Products Export Development Authority NACA The Network of Aquaculture Centers in Asia-Pacific NAFIQAVED National Fisheries Quality Assurance and Veterinary

Directorate NGO Non-Government Organization

PAD Pangasius Aquaculture Dialogue

SA Social and Accountability

SQF Safe quality food

SWOT Strength, Weakness, Opportunity, Threat

TAN Total ammonia nitrogen

VASEP The Vietnam Association of Seafood Exporters and

Producers

WTO World Trade Organization

CHAPTER 1 INTRODUCTION 1.1 Background

The stripped catfish is among the most popularly cultured species in the Mekong Delta together with high production and foreign currency

Vietnamese Pangasius export in 2010 reached US$1.427 billion; the farming

area was 5,400 ha with over 1.1 million tones in production In 2011, Vietnam

reached US$1.8 billion of Pangasius export higher than 2010, rising 26.5

percent over last year The farming area was 5,140 ha that is lower than 2010,

but the production was 1.1 million tones Pangasius has been being exported

to 80 countries in the world (EU, US, Spain Mexico, Australia, China and Germany…) (http://www.vasep.com.vn) In 2012, Vietnamese farming area

went down 5,300 ha and produced 865,000 tones of Pangasius The

production was lower than the previous years because of low price and high cost with the value of 1.37 billion dollars (http://www.fistenet.gov.vn)

Stocking density in pond culture is around 40-60 ind/m2 Yields reach 250-300 tones/ha/crop, exceptionally reaching 500 tones/ha/crop in ponds (FAO, 2012) The higher stocking density of tra catfish is applied, the more disease and negative environmental effects happen As a result, farmers have

to face the problems relating to heavily environmental pollution, disease outbreak, low seed quality… because they have usually used chemicals and drugs to treat these Such actions will reduce the importers‟ and customers‟ reliability

Together with exporting the Tra catfish products into hard imported countries in the world, some certification standards of Tra catfish farming and processing are created to ensure food hygiene safety and traceability for imported foodstuff of animal origin such as: Global GAP and ASC and CoC (applying for processor),… in the Mekong Delta The rapid growth of Tra catfish farming has raised concerns on the environmental and social aspects of this industry

In Vietnam, the Mekong Delta is the key aquaculture area; the farming model is towards sustainability by certification standards, such as: ASC and

Global GAP That is the general trend of Pangasius farming in the Mekong

Delta Especially, when WWF and VASEP agreed to conduct the ASC certification in Vietnam in 2010, WWF as a partner of ASC initiated the

meeting coordinate Pangasius Aquaculture Dialogue (PAD) to build the

standards which are measurable and based on the capacity to limit the negative impacts from the movement of catfish farming The requirement of ASC standard is quite high and people wonder if farmers can meet the need of all criteria of this standard.Thus, “An assessment on ASC certification standard

application for tra catfish (Pangasianodon hyphopthalmus) farms in the

Mekong Delta” was conducted to figure out somewhat has been being cared

1.2 Objectives

General objectives:

The research is conducted to review on the criteria of ASC Certification and import markets of ASC certified catfish and to evaluate catfish farmers‟ perception and application for ASC Certification to identify the advantages and disadvantages of catfish farmers in application to ASC Certification

Specific objectives:

i To describe the criteria of ASC Certification Standards for farming;

ii To identify technical and financial efficiency of fish farming;

iii To evaluate the applicability of ASC standards of Pangasius farming in

the Mekong Delta;

iv To address advantages and disadvantages of ASC standard application

v To propose some possible solutions for the applicability ASC standards

for Pangasius farming in Can Tho

CHAPTER 2 LITERATURE REVIEWS 2.1 Review on Status of Tra catfish farming in Vietnam

From 2000, Pangasius became an important object cultured in Vietnam

.According to VASEP in 2008, exports of fish products from Vietnam reached

USD 1.45 billion Production and export of Pangasius in 2011 reached

impressive results if compared with the efficient production of agricultural commodities such as shrimp, rice, subsidiary crops,… The output of tra catfish was harvested nearly 1.2 million tones; export reached more than USD 1.8 billion, up 26.5% compared to 2010 Vietnamese catfish were present in 135 markets worldwide, of which the exports to the EU, the key market for exporting of tra catfish, accounted for 29.1%; The United States accounted for 18.4% of the proportion of fish exports in 2011 reached 29.5% of total aquaculture products exported, maintaining second position after shrimp (http://www.vasep.com.vn) Vietnam had 401 seafood processing plants of which 301 factories export to the European standards, 30 are certified for exporting to Russia and 16 are accepted as ISO certified factories in 2012

The Pangasius export developed very much form 2002 – 2003 and that

got highest in 2008 (De Silva SS and Phuong, N T., 2011) In 10 years from

1998 – 2007, the total area was 6,000 ha, gained six times, annual production

of Pangasius was from 7,000 to over 1 million tones that went up 45 times over the period The export value increased 50 times from 19.7 million to 979.036 million dollars A total of about 0.2 million people in the Mekong

Delta was concerned with the Pangasius farming (Sinh and Hien, 2008) The

total production and the fillet production were 1.2 metric tones and US$ 1.45 billion, respectively (Dung, 2008) According to Sinh (2011), in recent years, the tra catfish farming has developed strongly together with the market

expansion In 2009, the Pangasius was exported to 80 countries

The rapid growth of Tra catfish was linked to the changes in pond culture system from extensive to intensive model during 2002 – 2010, the small farms dominated in periods of pond area, most were farmers controlled, owned and rented, 81.9% had the area less than 1 ha (De Silva SS and Phuong, N T.,

2011) However, the Pangasius farming and selling had difficulties of unstable

price, high production cost and fluctuated market,… From these difficulties, farmers established the linkages from themselves to other farmers in cooperatives called horizontal linkage and to the enterprises called vertical linkage According to Oanh and Minh (2011), the non-linked models gave the

highest failure rate compared to the linked models Therefore, large scales were more popular and can meet the demand of globalized market Vienamese catfish industry was willing to manage the difficulties and pressures

Beside the above mentioned development, there are still a lot of concerns

as unstable and risky potentials in Pangasius farming relating to environment

pollution and the usage of drugs and chemicals causing bad effects on the communities surrounding the culture areas Therefore, more certification standards are created to manage these issues in order to ensure the sustainable development of tra catfish farming and meet the requirement of importing markets in the world In particular, consumers in developed countries pay more and more attention to the quality of the product Many technical barriers have been erected on drug residue As a result, farms in the Mekong Delta have been complying the principles of international certification standards: BMP, GAP, BAP, organic certification and Viet Gap,… especially ASC, to improve the hygiene food, clear traceability and environmental-friendly product,…

2.2 Current standards and practices for Tra catfish farming in Mekong Delta

2.2.1 BMP

Up to now, the Mekong Delta has had no farms certified BMP, which only exists in the documents of CARD and SUMA projects The CARD is supported by Australia government and it contributes on building the BMP/GAP model in agriculture of Vietnam Many leaflets and booklets for applying BMP to shrimp and Tra catfish farming in the Mekong Delta are published BMP is a set of guidelines on the management, not the standard BMP is easy to apply and does not increase the cost BMP includes simple problems that are community responsibility, environmental protection, food hygiene and safety; and traceability In 2005, NAFIQAVED switched BMP into GAP Not only a single BMP farmer but also the team through the formation of groups associations can apply to help them improve productivity and reduce disease and increase profits BMP was suitable with small-scale farms, limited resources of financial investment, but effective management and solidarity in a group were hard problems (Dung and Don Griffiths, 2009)

2.2.2 GAP

GAP is a set of codes of practice based on the most basic requirements of the Code of conduct responsible fishing - CoC - (Article 9 of the CoC of the FAO-1995) to develop sustainable aquaculture including disease control,

environmental protection, food safety and improve economic efficiency for the application of GAP (MOFI, 2006)

Global GAP was proposed by the EU retailers in 1997 (formerly known as EUREPG.A.P) and applied in a voluntary certification for agricultural products worldwide The activities of GAP were to control of the inputs such as: seed, water, feed, chemicals, veterinary medicines, the health of fish,… to reduce stress, disease, antibiotic residue, toxicants and harmful bacteria Many GAP standards were published in the world such as the Global G.A.P (Europe); GAP (Southeast of ASIA), Viet GAP (Vietnam), etc However, Global GAP was popular in the world (Dung and Griffiths., 2009) If the products were obtained Global G.A.P certificate, they were often automatically accepted by other markets, because Europe was the market with the most stringent requirements in response to the customers‟ benefits as well as the customers‟ demands

Global G.A.P passed 4 versions Version 4 of Global G.A.P, which came into effect in early 2012, was a set of standards for safe agriculture products, assuring requirements in food safety and hygiene (HACCP…), environment (ISO 14001), social responsibility (SA 8000), and good health of the plants and animals Therefore, Global G.A.P was mentioned as “four in one” standards

Forty five aquaculture companies in Vietnam were certified internationally in July 2011 after being awarded the Global GAP certificate or Global Good Agricultural Practice (Dung, H.N., 2011) The certificate gave them a lot of benefits: customers‟ reliability, improved operation efficiency and competitiveness, constant renovation and minimized inspection carried out by the second party Export price of Global G.A.P certified agro-products was about 20 percent higher than that of non-certified products in some markets However, To follow such standards, the cost of production would be 20% higher and small households were hard to conduct Therefore, very few farmers believed that the increased interest can offset part of the increased cost (Dung and Griffiths., 2009)

2.2.3 BAP

BAP was a set of codes of practice based on the most basic requirements of environmental and social responsibility, animal welfare, food safety and traceability; it was a voluntary certification program for aquaculture facilities (GAA, 2007) the change of the consumer awareness and the rules of standards of imported countries encouraged producing the safety products, social and environmental responsibility and long-term sustainability in the

aquaculture industry The BAP program outlines standards for each type of facility, from hatchery and feed mill to farm and processing plant BAP currently certifies the farms and hatcheries of salmon, tilapia, channel catfish

and Pangasius included in seafood processing plants and feed mills

(http://www.gaalliance.org) Each BAP certification has the valid for 1 year

BAP was developed by GAA and was implemented by ACC GAA was established in 1997 which was the non-profit NGO developing the Best Aquaculture Practices certification standards and encouraged the use of responsible aquaculture practices ACC was established in 2002 to certify for aquatic plants by the application of standards BAP by GAA construction encourages the use of responsible aquaculture practices From 2003, ACC began implementation of BAP certification for Tra catfish, shrimp, tilapia, channel catfish in Ecuador, Bangladesh, Malaysia, Indonesia, and Thailand …

BAP standard defined 4 main criteria which ensured food safety, social responsibility, environmental protection and Traceability The BAP

certification for Pangasius consisted of 14 standards: 3 community standards,

8 environment standards and 3 food safety standards as right property and regulatory compliance, community relations, worker safety and employee relations, wetland conservation and biodiversity protection, effluent management, sludge management, soil land and water conservation, fishmeal

and fish oil management, control escapes,… BAP was known to be strict

standards on effluent The value of phosphorous and TAN are concerned so much at the fish processing plants (ACC, 2006) In August 2010, the BAP standard for Tra catfish was built to standardize fish products labeled BAP logo and sold in the US market, GAA also worked to improve production and marketing efficiencies, and promote effective, coordinated regulatory and Trade policies which required the suppliers certified at least 2-star BAP (BAP**) meaning the products came from certified farms and processing plants, 3-star BAP (BAP***) was similar to 2-star BAP but there was one more BAP certification for hatchery The certification costs were high that was suited to the large scale company based farms

From the statistical results on ACC„s website:

www.aquaculturecertification.org updated in March 2012, BAP certification

addressed 324 processing plants, 127 farms and 30 hatcheries of 3 main species: catfish, shrimp and tilapia According to Xuyen and Minh (2010), BAP certification had mainly certified for ASIAN countries (77.2%), a hundred percent of BAP certification for catfish were been certified for US companies, companies in shrimp production and processing plants, was

accounted for 73.55%, certified tilapia of china accounted for 66.7% of the certified tilapia total The movement for BAP certification worldwide is growing for processing plants, farm and seed production increasingly to assert their prestige in the eye of customers The director of BAP certification program, William More, said BAP was expected more than 30,000 tons of fish from the farm to be certified at end of July 2012 in Vietnam (VASEP, 2012)

2.2.4 Organic Tra catfish farming

Organic agriculture was a holistic production management system which promotes, enhances ecosystem health and reuses waste and utilizes renewable resources, including biological cycles and soil biological activity Organic agriculture was based on minimizing the use of external inputs, avoiding the use

of synthetic fertilizers and pesticides, pollution of air, soil and water Organic food handlers, processors and retailers adhere to standards to maintain the integrity of organic agriculture products The largest market for this product is

US (26.5 millions USD), EU, Japan (VASEP, 2012) Organic aquaculture would improve the value of products because consumers are willing to pay more money

to get safe products (Trieu, T., 2004) In Vietnam, organic tra catfish production got up 100 tons in 2004 However, this had difficulties due to lack of capital and technology, bad water and diseases, they result low yield, and imported markets have not been expanded yet, mainly exported to Europe and the US

2.2.5 Viet GAP

According to this general trend, in Vietnam, the Ministry of Agriculture and Rural Development - MARD issued the Code of good aquaculture practice in Vietnam (Viet that the requirements of food safety, disease outbreak limitation, environment protection, social responsibility and traceability of products with a focus on controlling process of inputs

Viet GAP had only 68 criteria, built in accordance with the production conditions in Vietnam It was much simpler than certification systems (Global GAP, BAP, ASC,…) with more than 100 criteria This standard also aimed to provide opportunities for small and medium-sized farms entering the market, accessing to services; raising awareness of the production of goods, product certification, responding the needs of the market; improving the quality of aquaculture products without increasing the cost of production, and becoming the cornerstone of the system of voluntary aquaculture certification, and taking advantage of the resources However, up to now, the Viet GAP standard was not recognized by the international market that Viet GAP was satisfactory standards of food safety (http://www.vinacert.vn)

The transition from non-standardized culture to Viet GAP standardized culture for individual farmer was not easy, because farms did not built sediment settling ponds, and waste treatment ponds As the result, building these ponds followed by Viet GAP standard was very expensive Therefore, when Viet GAP standard was enacted, many businesses and households did not have sufficient funds to renovate farms in new directions, so the application of this standard was still difficult and not many people responded (http://thuysanvietnam.com.vn)

CHAPTER 3 METHODS AND MATERIALS 3.1 Study area

This study was implemented from 6-11/2012 in Can Tho city (O Mon and Thot Not districts), Tien Giang, An Giang, Ben Tre, and Dong Thap Provinces

3.2 Data collection

3.2.1 Secondary data

Secondary data were collected from reports, researches, Departments of Agriculture and Rural Development-DARD in above provinces , newspapers, magazines and relating websites

3.2.2 Primary data

Data were collected through interviewing randomly: (1) 30 individual

Pangasius households in Thot Not and O Mon districts; (2) 30 members in 2

Thot Not and O Mon Cooperatives; (3) key persons in 5 Pangasius

companies: ANVIFISH, Vinh Hoan, GODACO, SOHA, NGOC HA located in

An Giang, Dong Thap, Ben Tre, Can Tho, Tien Giang Questionnaires were used to pre-test before carrying out research implementation

Study area

Study area

Figure 3.1: Map of the study areas

(Source from: https://www.google.com.vn)

3.2.3 Sample size

The number of samples included 30 individual Pangasius households, 30 members in 2 cooperatives and 5 Pangasius producers from Can Tho, Ben

Tre, Tien Giang, An Giang and Dong Thap provinces (Table 3.1)

Table 3.1: Number of surveyed farms

3.2.4 The list of main variables in questionnaire

The main variables are technical and financial information relating to ASC standards shown in Table 3.2

Study area

Study area

Study area

Study

area

Table 3.2: The complex variables and single variables in the questionnaire

General information Name, age, labor in family, rented labor,

experience, technical sources, income of family,…

Technical information

Stocking density, feed type, seed size, water exchange rate, water frequency, disease, harvested fish size, mud containing place, water supplying sources, total area, water surface area, production, yield and water level,…

Finance

Cost of production, revenue, profit, cost of seed, drugs and chemicals cost, feed cost, pond preparation cost and interest rate,…

Variable related to ASC:

 Legal compliance

 Land and water use

 Reduce bad impact to

land and water resources

The data were checked, inputted and analyzed by using Microsoft Excel

to input data and then SPSS (version 16.0) was used data Descriptive statistic method with analysis of variance (ANOVA) were used with Significant level (α = 5%)

Descriptive statistic helped provide the size of samples, average, standard deviation, of technical and financial variables

Comparative statistic was applied to compare the data mean value of yield, cost, profit,… and evaluate the efficiency and the differences of 3 listed models

CHAPTER 4 RESULTS AND DISCUSSIONS 4.1 The overview of the standard certification of ASC in Mekong Delta

In 2007, ASC was adopted As a result, the documents of ASC was developed by the PAD coordinator and published by WWF Such documents are published in the world in 2011 and it can be supposed that ASC will be a new certification standard for the sustainable development of tra catfish The ASC certification is applied for Tra/Basa catfish, tilapia, abalone, cobia, fresh trout, salmon, seriola, shrimp in Vietnam, Indonesia, Equador, Honduras, Malaysia, Costa Rica… However, the mainly certified species are tra catfish and tilapia (http://www.asc-aqua.org)

There were 8 Vietnamese Pangasius producers certified ASC in 2012,

including Vinh Hoan, Hung Vuong, NTACO, Hoang Long Vinh Quang, Ngoc

Ha, Anvifish, Bien Dong (http://www.asc-aqua.org) The catfish production of

these companies was estimated 10% of total Pangasius production of

Vietnam Moreover, 20 other businesses are implementing processes and procedures to achieve sustainable production certification standards Towards

2015, Vietnam has 50% of Pangasius production will be certified ASC With

a new certificate, the Vietnamese catfish industry will have competitive advantages and market share in key and potential markets, especially in the time of importers and consumers are very interested in the quality and value products However, other enterprises do not want to move forwards to ASC Certification because they think that the market for ASC is small based on countries of Europe Current ASC certification is only known in Europe, but other areas are unknown to ASC, especially the US market So WWF and other relevant organizations should have extensive promotions for Vietnamese catfish products certified ASC 30 catfish production companies in Vietnam has been getting certification in the near future (http://www.vasep.com.vn)

4.2 The general information

Average household sizes of Pangasius farmers and members of

cooperatives were 4.4±1.38 persons, and 4.13±1.48 persons, respectively Average key labour involving in farming of farmers and Cooperatives are 2.87±0.90 persons and 2.4±1.10, respectively Number of hired labour in companies varied from 20 to 25 persons per farm 2.63±0.87 (labours/ha) more than that in farmers‟ farms 1.31±1.34 (labour/ha) and cooperatives‟ farms 2.42±2.19(labours/ha) The total culture areas were not significantly different

between farmers and cooperatives, 1.41±1.52 ha and 0.94±0.56 ha, respectively

but there was significant difference between those and companies, i.e

14.1±5.06 ha (P<0.05) The farming experience of 3 groups similar, i.e

7.60-8.73 years) (Table 4.1)

Table 4.1: General information of Pangasius farms (mean±std)

Items Farmer Cooperative Company Household size (people) 4.4±1.38a 4.13±1.48a -

Key members involved in farm

(people) 2.87±0.90a 2.4±1.10a -

Hired labor (persons/ha) 1.31±1.34a 2.42±2.19a 2.63±0.87a

Farming experience (years) 8.23±3.51a 8.73±4.05a 7.60±4.28a

Total area (ha) 1.41±1.52a 0.95±0.56a 14.1±5.06b

(Values in the same row with the different letters are significant difference (p<0.05))

4.3 The procedures of the standard certification of ASC

The certification process was conducted by the Conformity Assessment

Body – CAB as well as the independent third party The farms would rent a

CAB accredited by Accreditation Services International – ASI The ASC logo

products labeled only was certified by CAB being recognized by ASI

Figure 4.1: The procedures of the standard certification of ASC

(Sourced from: Workshop of “Experience on ASC application to Pangasius farming

in Vietnam, 2013)

The total average cost for certification per farm was about USD 20,000

but Pangasius producers (have Trader/Buyers) just paid USD 10,000 (50%)

and 40% for producers (have not yet Traders) because the ASC Accelerator ( Netherlands Development Organization - SNV) has co-funded as well as

Register

to CUVN

Assessment

Posting primary report on website Recertification

Comment of stake holder Post to ASC

website

technical support for producers The validity of ASC certification is 1 year The total amount money invoiced is net of allowances for trade discounts and returns for which the Licensee has issued a credit note; and sales and excise taxes (including VAT, if any), subject in all cases to the same being separately charged on customer invoices (Jose R Villalon., 2012)

Figure 4.2: The logo of ASC

(Sourced from: http://www.asc-aqua.org )

Table 4.2: Logo fee (Revised from the table of Jose R Villalon., 2012)

Sales of MSC-labelled

products

Consumner facing (Annual Fee + Volume)

Non - consumer facing

0 - 200,000 USD 250 USD + 0.5 % of sales 250 USD 200,001 - 500,000 USD 1000 USD + 0.5 % of sales 1000 USD

>500,000 USD 2000 USD + 0.5 % of sales 2000 USD

4.4 The technical status of Pangasius farms

4.4.1 Farming area

The average water surface farm areas were significantly different between 3 groups: cooperatives of 0.65 ha, farmers of 1.2 ha and companies of

10.5 ha (P<0.05), accounted 68-85% of total area The depth was not

significant different among 3 groups (Table 4.3) The result was similar to the report of Sena S De Silva and Phuong (2011), i.e 3.5-4.5m deep According

to Hien (2010), the pond area and water depth were 1.0ha/household and 3.7

m, respectively

One of the objectives of catfish culture based on international standards

is to maintain and promote the protection of the environment Mud storage pond is an important criterion of ASC standard Surveyed results showed that most farms of 90% farmers and 66.67% cooperatives are designed simply and

negligently without water storage and settling area while 100% companies do this (0.99 ha of mud containing area and 0.41 ha of settling pond area) The mud containing area was accounted 0.14%, 2.11% and 7.02% of total area of farmers, cooperatives and companies Therefore, the mud was discharged freely into rivers, for farmers with 76.67%, cooperatives with 50%, but 0% of companies This will cause the disease transmission between farms and water pollution for local community The first reason for that was the area of farmers

is small, so they take all areas to culture fish to increase their profit instead of constructing reservoirs The second one is their awareness of environment protection and social responsibility is low The sludge discharge is a usual and normal activity of farmers for a long time It was hard to change their knowledge to follow the ASC standard However, with companies, there were regulations of environment protection that they have to follow strictly

Table 4.3: The aquaculture area of 3 different groups

Items Farmer Cooperative Company

1 Total area (ha) 1.41±1.52a 0.95±0.57a 14.10±5.06b

2 Water surface area (ha) 1.2±1.36a 0.65±0.44a 10.5±3.66b

3 Sediment settle pond (ha) 0.002±0.007a 0.02±0.11a 0.99±0.34b

4 Water level (m) 3.38±0.58a 4.17±0.49b 3.99±0.22ab

5 Sedimentation pond area - - 0.41±0.24b

6 Places for mud storage (%)

- Reservoir 10 33.33 100

- For other farms 0 16.67 60

(Values in the same row with the different letters are significant difference (p<0.05))

4.4.2 The information of Pangasius Seed

Seed buying rate in the provinces was 50% of farmers and 70% of cooperatives and 20% of companies because the price of fingerlings in the provinces was cheaper and seed were transported fast to limit mortality rate However, most seed sources of farmers and cooperatives were from non-standardized hatcheries with 100% and 83% respectively Only 17% of cooperatives used the ones from standardized hatcheries because of high survival rate and adoption of processing plants 100% companies used

standardized seed, and 60% companies had closed chain from hatchery to factory to ensure their products had clear traceability that was critical requirement of ASC standard and hard markets The standardized hatcheries might supply and ensure enough evidences required by ASC standard like resistance residue, seed traceability, no use of wild seed… Most of farmers did not acknowledge of seed role in production 96.67% of farmers and 33% of cooperatives did not test seed for diseases This number was different from companies with 100% did it

The average density of 45-58.23 ind/m2 was not significantly different

(P>0.05) The seed size was 32-74.17 ind/kg, which was significantly

different (P<0.05) Density result was lower than research of Hien (2008),

average density was 47.2 ind/m2 in freshwater, that was suitable with Sinh and Hien (2008), density of 45-60 ind/m2 and fingerlings of 1.2-2 cm height (the weight of 7-33g/ind) was suited According to the ASC standard, the request was to reduce the density at 38 kg/m2 to limit the disease outbreak and reduce water pollution Density of farmers and companies can apply for ASC standard but cooperatives can not, the density depends on seed size, seed quality and water depth

Table 4.4: the information of Pangasius Seed

Items Farmer Cooperative Company

1 Seed bought from (%)

4 Density (ind/m2/crop) 47.25±13.97a 58.23±18.39a 45±13.23a

5 Seed size (ind/kg) 43.17±22.84a 74.17±44.49b 32±4.47a

(Values in the same row with the different letters are significant difference (p<0.05))

4.4.3 The water management in pond

A hundred percent of farmers and cooperative took water directly from the river into the pond, but 100% companies took water through settling pond These showed that both farmers and cooperative were not aware of the feed and water management issues and did not design proper system because of

small scale These actions were the causes of the disease transmission and increased water pollution Frequency was 1.17±0.38 day/time, 1.53±0.78 day/time and 2.60±0.89 day/time for farmers, cooperative and company

respectively According to Hien (2008) the frequency was 1.6 day/time, Sinh

and Hien (2008), which was 2-3 day/time to get good results According to ASC standard the water volume used to produce 1 ton of fish is 5000m3/ton of fish that means each 1 ha water surface area with 4m in depth produces 350 tones of fish and exchanges water 30%/2day/time in 7 months The water changing rate was similar, ranged from 30-32.67%, the higher frequency addressed that the more water pollution and the higher density when compared

to previous researches

Table 4.5: The water exchange

Items Farmer Cooperative Company

1 Water resource (%)

- Direct from river/channel 100 100 0

- Through settling ponds 0 0 100

2 Frequency (day/ time) 1.17±0.38a 1.53±0.78a 2.60±0.89b

3 The rate of water change (%/time) 32.67±4.69a 32.33±4.69a 30±0.0b

(Values in the same row with the different letters are significant difference (p<0.05))

4.4.4 The culturing time, harvest, yield, survival rate

The culturing time average was 7.7 month/crop which was higher than the research of Oanh and Minh (2011), culture time was 7 month The culture time was long or short, based on seed size, disease and price The survival rate ranged 63.57-84.11% According to Oanh and Minh (2011), the survival rate was 75.7%, and the survival rate of Hien (2008) was 76.2% In this research, the survival rate was 72.79% that was lower than the previous research due to disease outbreak, water pollution and poor seed quality Almost 100% of 3 groups used the pellet feed in culture with 1.58-1.69 of FCR, the result was suited to result of Dung (2008), FCR of pellet feed was 1.5-1.8 and was equivalent to research of Oanh and Minh (2011), FCR was 1.62 To comply ASC standards, the morality rate and FCR should be less than 20% and 1.58, respectively, ASC application for company was higher than other groups Only 10% of cooperatives, 30% farmers and 50% companies comply with survival rate standard, FCR was complied by 70% farmers, 86.67% cooperatives and 100% companies (Appendix B1)

The yield average of farmer was 326.14 tones/ha/crop, lower than cooperatives with 372.78 tones/ha/crop and company with 336.96 tones/ha/crop (P>0.05) That of Anh (2010) was 373.3-416.1 tones/ha/crop

Oanh and Minh (2011) reported the yield was 334.29 tones/ha/crop The result was lower than the previous researches; the reasons are the difference of density, culture time, survival rate and harvest size

Table 4.6: The culturing time, harvest, yield, survival rate

Items Farmer Cooperative Company Culturing time (month) 7.55±0.50a 8.02±1.07a 7.50±1.4aHarvesting size (kg/ind) 0.98±0.13a 0.97±0.1a 0.88±0.04aSurvival rate (%) 70.69±12.00a 63.57±10.19b 84.11±3.90cYield (ton/ha) 326.14±114.25a 372.78±112.25a 336.96±105.67aFCR 1.66±0.11a 1.69±0.35a 1.58±0.05a

(Values in the same row with the different letters are significant difference (p<0.05)) 4.5 The financial efficiency of farmer, cooperative and company

The total cost are invested for 1 hectare per crop of Pangasius was high

and not significantly different, being 8,151; 9,356 and 8,293 million/ha/crop of farmer, cooperative and company, respectively Sinh and Hien (2008) surveyed that was 4,230 million/ha/crop in inland According to An and Minh (2010) that was 5,957.6 million/ha/crop in freshwater culturing area Belonging to the research of Oanh and Minh (2011), the total cost was 5,280 million/ha/crop, this result was 8,600 million/ha/crop that was higher than the previous studies because the feed, seed, drugs and chemical cost,… has increased

According to the farmers survey, feed cost was highest which was accounted 80% of total cost, the cost of seed, drugs and chemicals was accounted 4.67% and 4.33% respectively This result was lower than the research of Oanh and Minh (2011); and Anh (2010) the feed cost was accounted 84% and 84.4% respectively According to Chinh (2005), the seed, drug and chemicals rate was 3.5% and 5%

The capital sources of 3 groups are from their estate with 100% and state loan with 100%, however more than 50% of 2 groups of farmer and cooperative must loan from others in the difficult economy status, while the state bank did not lent to farmer and interest rate was high (15-19%/year), therefore the it‟s cost average was 8.67% of total cost

Table 4.7: The major economic indicators (Unit : VND)

The cost of seed (million/ha/crop) 313.23±140.64a 394.68±283.43a 346.80±107.55aThe cost of feed (million/ha/crop) 5,951±2,363a 6,701±1990a 5,782.00±1,874aThe cost of drugs and chemicals

(million/ha/crop) 311.96±107.44a 383.72±111.37b 262.63±84.10abInterest cost (million/ha/crop) 615.00±235.87a 688.82±254.36a 681.96±253.32aPrice of fish (dong/kg of fish) 22,983±836a 23,783±1,665a 26,800±0.57bProduction cost (dong/kg of fish) 25,052±1,733a 25,174±1,196a 24,662±835aTotal cost (million/ha/crop) 8,151 ±2,837a 9,356±2,770a 8,293±2,488aTotal revenue (million/ha/crop) 7,485±2,598a 8,827±2,651a 9,045±2,944aTotal net income

(million/ha/crop)

666.77±670.64a -528.81±1011.40a 752.29±652.03bProfit of net income per kg -2.07a -1.39 a 2.14bRate of return (%) -7.88±6.68a -5.20±9.23a 8.82±5.76bBenefit – cost rate (time) 0.92±0.06a 0.95±0.09a 1.09±0.06b

(Values in the same row with the different letters are significant difference (p<0.05))

The results showed that, the production cost ranged 24,662- 25,052

(dong/kg of fish) was not significant (P>0.05) but the fish selling price was

significantly different, the highest price based on company which was 26,800 VND/kg of fish In 2008, production cost and price were 14,151 dong/kg of fish and 15,020 dong/kg (Anh, C T., 2010), according to Oanh and Minh (2011) these were 15,755 and 15,959 respectively These data addressed that the costs for culture increased much while prices was unstable The farmers had to invest 100% of all costs; the failure rate was high that was 86.67%, 63.33% and 20% for farmer, cooperative and company, respectively This result showed that international standard application would help the product price be higher sold in international market

Figure 4.3: The Rate of return (%) and Benefit – cost rate (time)

The financial efficiency of farmer and cooperative was still low; it led to appearance of unstable model The financial efficiency of company was 8.82±5.76%, having significantly financial efficiency when compared to farmers and cooperative rate return of -7.88±6.68% and -5.20±9.23%, respectively, showed the standardized model had more advantages than others

The international standard helped Pangasius grow-out farm had higher

product price both in the local and international markets because it met demands of hard markets such as: product traceability, environment and wild animal protection,… these increased the consumer‟s belief on product made

in Vietnam

Feed 78%

Seed 5%

Drugs and chemicals 4%

Other

4%

Interest 9%

Figure 4.4: the Structures of production cost of Farmers, Cooperatives

and companies

Cooperative

Interest 8%

Other 2%

Drugs and chemicals 5%

Seed 5%

Feed 80%

Farmer

Feed 82%

Seed 4%

Drugs and chemicals 4%

Other 2%

Interest 8%

4.6 The perception of Pangasius farmer, cooperative and company

The level of knowledge about standard certification ASC

Survey results at the farms showed that up to 100% farmers as well as farmers in cooperatives did not know ASC standard Only 6.67% farmers 10%

of the farmers in cooperatives known but not well understood Such rate was different from companies, 100% of companies had a good understanding To export products into foreign markets, companies must fully understand the standards that the market wanted ASC was new standard which was hardly updated by farmers and cooperatives because no offices told us or trained them The reason to raise and continue to raise fish for the standard ASC

All Pangasisus farms of 3 surveyed groups wanted to apply the ASC

standard as well as other standards currently certified as Global GAP, Viet GAP, and MSC, 56.67% cooperatives 63.33% farmers, and 100% companies that ASC standard and other standards were easier to sell fish and products were sold at a higher price level when certified the ASC standard In addition to, 3 groups agreed quite highly that farming are sustainable, 100% companies had enough conditions to conduct the ASC certification

Development Trend of catfish according to the ASC standard certification ASC certified farm trend has been increasing markedly which was said

by 100% farmers, 73.33% cooperatives and 100% companies, the reasons were high price and easy sold 50% of farmers and cooperatives agreed that non-standardized catfish farming trend was declining because the price of

Pangasius decreased much in 2012 that makes farmer depressed on the Pangasius farming.

Technical Resources

For farmers, 100% their technical farming was personally experienced, followed by 86.67% discussed with others and 16.67% received training from extension offices For cooperative‟s culture experience, 100% had personal experience, 56.67% was from exchange with other farmers and 20% was from the specialized agencies Survey results showed that the professional bodies did not affect the choices and decisions Survey results showed that the professional bodies did not affect strongly to the aquaculture technique farmers (16.67%) and farms in cooperatives (20%), 100% companies were trained by specialized agencies Results showed that the ability to update new information of farmers and cooperatives of technical factor, international standards and market demands was limited very much

Capital and main difficulties

All farmers, cooperative and companies had the capital came from them and bank in short term with interest, of which only 63.33% of the farmers and 50% farmer in cooperative owned from other sources, The wastes of farms were discharged into river included in mud, water, feces of animals,… that increased environmental pollution and diseases outbreak in the future The price problem and the disease caused risks to catfish farming ASC standard compliance might reduce the bad activities to environment protection

Table 4.8: The perceptions of Pangasius farmer, cooperative and company

(Unit :%)

Items Farmer Cooperative company

1 The level of understanding of ASC

- Higher selling price 63.33 56.67 100

- Meeting the conditions for rearing 0 0 100

4.7 The assessment of the ASC criteria application of farms

In the ASC standard criteria, Comparing the level of compliance of the ASC standard farmers as well as farmers in cooperatives was very low but

there are some important points to achieve, almost 100% of the farmers used pellet feed, no critical antibiotics using for human, no child labor and aquaculture license, The hard criteria for farmer and cooperative were Social Impact Assessment (p-SIA), endangered species list, water parameters and traceability evidence of seed, All companies asked, answered that 100% have been applying the Global Gap now, therefore the company met the criteria very well when compared to farmers and cooperatives because companies had specific documents and witness evidences that ASC required The farms of companies complied traceability of products but farmers and cooperative can not

ASC standards required detail on matters relating to the operation of

Pangasius farms, to meet most of the criteria was very difficult, as the result the

farms has Global GAP certificate should be integrated with ASC, that means the full quality management system was applied followed by the Global GAP, such farms just added the elements that were in accordance with ASC such as list of threatened species in the farming sector, water parameters, ISEAL certification for fish meal, etc And only one company could met most of the criteria of ASC which was Vinh Hoan accounted 91/93 criteria for pond

4.8 Advantages and disadvantages of ASC standard application

4.8.1 Advantages

According to the opinion of the people asked, the Pangasius culture

toward standard certification is the development trend in the world because there are many trade and technical barriers of importing countries and the traceability requirement of the consumer The enterprises conduct the standard certification which will have advantages to access the world market; the farms take part in certification getting the higher profit This is the opportunity for us

to make co-production (big scale) like cooperatives, linkage between farmers and enterprises, and is the opportunity to train the human resources

Environment: farmers, cooperatives andenterprises, supposed that the

certification standard for Pangasisus contributed the environmental protection

The farmers and companies said that the mud and chemicals discharged destroyed the environment; the ASC standard will help people acknowledge that the action of mud and water discharge was illegal and caused environmental pollution The application of this standard contributed to limit the negative impacts to environment through the management of waste, water, chemicals and household waste

Technology: most of the farmers had long experience, but they known a fewer information of the ASC standard Management agencies were confused

of updating information on international standards to convey to the farmers In this regard, enterprises had better access because they met the demand of market, for example; the Europe market needs Global Gap and ASC Enterprises were quick to meet that needed, the scientist, certification experts and consultants were trained firstly then they would convey these standards to enterprises and farmers Good implementation of standard was going to limit disease outbreak and transmission that made the panaceas successful

Social-economic: culturing of Pangasius was very important economic

sectors in Mekong Delta which had create jobs for many people through the

action of Pangasius culturing From farming to processing in plant ASC

standard protected the rights of the laborers The consumer heath was regarded; the awareness of culturing follows to the community increased

4.8.2 Disadvantages

Technology: farmers had low level, farmers seldom followed the aquaculture expert recommendation, especially, with the small scale, it was hard to apply the certification

Social-economic: all people supposed that Pangasius certification needed

a lot of money to invest, the cost of certification process was counted 20% of product price

Management: the managers did not know the ASC standard certification yet The implementation of certification had no orientation for farmers to access; they also thought that such action was the work of processing plant

Table 4.9: The analysis of advantages and disadvantages of ASC standard application

Advantages

water and mud into river directly

 High pagasius price

 Complying with water, chemicals and mud discharge and the use

of antibiotic

 The importers require the safety and traceability for products

certification

 The managers/officials have not concern yet

Chapter 5 CONCLUSIONS AND RECOMMENDATIONS

5.1 Conclusions

— The ASC standard compliance ability of 5 companies interviewed was high if they correct and add some elements accorded to ASC standard that of farmer and cooperative was too hard because of small scale and

no awareness of environment protection and unstable price of fish

— The ASC standard application might make the changes in technical farming, waste management, social responsibility, and the traceability

of fish farmers

— The rate of return of company was 8.82±5.76, having significantly financial efficiency when compared to farmers and cooperative rate of return of -7.88±6.68 and -5.20±9.23, respectively That showed the standardized model has more advantages than others

— The groups supposed that the ASC standard application will be more developed in the future because of foreign market demand and sustainable development

— The Pangasius farmers will have many advantages of technical and

economical efficiency, environment protection, labor rights and disease limitation from ASC standard

5.2 Recommendations

— It needs to research on the assessment of standards (ASC, Global Gap,

BAP, Viet Gap,…) application state of catfish (Pangasinodon

hypophthalmus) in the Mekong Delta

— It needs to study on gap analysis for Global GAP certified farms to

comply ASC Certification Standard for Pangasius farms in the Mekong

Delta

— Value chain comparison between ASC certified farm and non-certified farm should be studied in future