Socioeconomics and production efficiency of tilapia hatchery operations in the Philippines

Abstract

Abstract With the recent availability of genetically improved Nile tilapia strain in the Philippines, it is important to look at the existing profile of tilapia hatchery operations in the country to help examine the potential strategies in the dissemination of the improved strain among hatchery operators. This paper attempts to analyze the socioeconomics and production efficiency status of tilapia hatcheries in the Philippines prior to the adoption of genetically improved Nile tilapia strain. A stochastic frontier production function is specified and estimated to examine the levels of farm‐specific technical efficiencies of tilapia hatchery operation. Tilapia hatchery operators in the Philippines have the necessary education, tenure security, and adequate years of experience and are willing to adopt new technologies and better strains if these are made available to them. Tilapia hatchery is a highly profitable operation. The cost of production per unit of fingerling produced will be higher for the genetically improved strain compared to the existing strains. The estimated mean technical efficiency of 76 hatchery operators in the sample is 48%. By operating at full technical efficiency the tilapia hatchery operators in the Philippines, on average, would be able to increase their production from 748 000 to 1558 000 fingerlings per production cycle per hectare. This would result in the decrease in the cost of production per unit of fry/fingerling produced and would make fry/fingerling more affordable to tilapia farmers, ceteris paribus. Key words: tilapia hatcherystochastic production frontiertechnical efficiencythe Philippinesprofile of hatchery operations