By Michael Joseph Picchietti*
When it comes to the seafood and aquaculture industries, the realities of our dwindling natural resources are constantly in our faces, in the media and in our laws. After all, our medium is water and we are dealing with limited natural resources that are in demand by more and more people. It’s not only population fueling demand but growing wealth in the developing world demanding more and better food. It’s clear that regulatory pressures are continuing to build like a giant tsunami. Nature, by its very nature, is in limited supply, resulting in the wild capture seafood industry shrinking, while the aquaculture industry is trying to grow to keep up with demand amid a regulatory blitz. I can’t think of a better market for regulatory products and services than the seafood and aquaculture industries. However, consumers are less and less confident their governments are capable of protecting the food supply—especially after the mad cow, bird flu and deadly bacterial outbreaks. Proof of this lack of governmental trust is evident in the creation and growth of the non-governmental organizations (NGO’s) like ASC, Aquaculture Stewardship Council, which is working to provide confidence in the aquaculture sector.
Clearly for the seafood industry (wild capture) regulatory controls via quotas are the main market controlling mechanism in determining the volume of catches for Pollock, Cod, Salmon, lobster, whales, etc. and at what price they end up in the market. In effect, these regulators also determine who is going to make money (or not) within this regulated supply. Regulatory control over supply in a demand-rich environment regulates the price and margin, as well as who is going to supply it. There is no profitability in the wild catch seafood business other than through regulatory control or quotas. The money is in the quota, that’s the business.
There comes a point when all these “regs” can work against that which they are trying to regulate and by nature of their mandate they become the limiting factor of the supply. The same actors that had been involved in the ocean-based wild fisheries regulations are expanding into the aquaculture industry. While there are similarities in wild capture and aquaculture, there are also significant differences. The conservationist attitudes and actions of regulators imposed on wild harvest quotas are being imposed onto aquaculture-based issues. Many of the scientists working for conservation NGO’s have no experience and little knowledge of how aquaculture really works. Their knowledge, attitudes and lens into the industryis are grounded in ocean-based wild capture fisheries knowledge and battles over those issues.
If the educated scientists coming out of fisheries colleges don’t understand aquaculture, how can we expect the consumer to understand it? It doesn’t take much searching to find misinformation on the internet about salmon, shrimp and tilapia being worse than bacon or donuts and living in water with excrement. It’s going to take some careful strategic thought from those trying to produce aquaculture seafood to address these differences and educate those that are going to make a career in regulating the industry for this all to work out. The big debate over more or less regulations has morphed into our platforms of political parties, tea party and the enlightened left. It’s become a polarizing factor in our body politic.
The risk of over regulation, ill constructed regulations, or burdensome regulations for producers who try to live by a code of fairness and ethics can easily result in the honest ones leaving the industry because of the burden of various rules and regulations. I know I personally spend a considerable amount of my time dealing with rules and regulations in one form or another compared to actually farming fish. If we look at the growth of the number of employees directly and indirectly making their livings in the rules and regulation industries, I think it’s a growth sector being born. It’s therefore logical that they are going to keep creating regulatory products and services to justify their incomes. In the end, for the producer of products, there must exist a sense of right and wrong, a sense of responsibility to society and the consumer for our food supply to establish confidence. If not, rules and regulations imposed by others are not going to work. Over two hundred years ago Edmund Burke said, “It is not what a lawyer tells me I may do; but what humanity, reason, and justice tell me I ought to do.”
In aquaculture there are many examples both past and present of the regulatory burden and its impact on production. Dr. Carol Engle outlines this very well in her publication, “Competitiveness of U.S. Aquaculture within the current U.S. Regulatory Framework.” (Carole Engle & Nathan Stone, 2013) Interestingly, in the paper there are references to 1,300 various regulations U.S. aquaculturists must deal with.
Tilapia regulations in the late 70’s and early 80’s in Florida determined, and undermined, any profitable tilapia culture. At first private farmers had a hard time even getting permits for tilapia. In the early 80’s, growers were required to install bird netting over outdoor ponds and facilities. Of course, for the volume and space needed for grow out this was a complete deal breaker. In my opinion, this had an intended consequence of forcing investor farmers to use unprofitable RAS techniques, which appeared more environmentally friendly to conservationists but have been largely unprofitable to investors, especially with early 1980’s technology. In this unworkable regulatory environment of the 1980’s, I left Florida and worked in tilapia aquaculture outside the U.S. for many years. Many countries, especially developing tropical ones with younger, poorer populations, had a more pragmatic view of aquaculture production methods to feed their growing populations.
I eventually returned to Florida in the late 90’s. By that time, Florida Fish and Game had scrapped the foolish bird net regulations, finally allowed T. nilotica to be cultured and reluctantly allowed outdoor pond culture. I designed and operated an outdoor pond farm in Central Florida using 12 1-acre ponds to test the economics of outdoor ponds. We proved we could get through the winters pumping 75°F well water during cold spells and grow less expensive tilapia in ponds than using the RAS system. We were supplying the live market in New York City in the late 90’s from Florida earthen ponds. With a good cement purge system, we could harvest, reduce handling stress and control temperatures—it worked. However, certain individuals in the Florida Fish and Game Commission were never happy about the possibility of an outdoor tilapia pond industry developing in Florida. One sunny day, a Fish and Game team raided the farm while I was pumping out a fingerling pond onto a cow pasture to harvest the fish. They had been filming my activities in a stakeout over some time. They arrested me, charging me with discharging exotic tilapia into the “waters of the state.” Of course I argued how can a 300 acre dry cow pasture become a water of the state, as it’s full of cows eating grass? It so happened that 100 years ago the pasture was underwater and remained therefore in the 100 year flood plain, so this was not permitted. Plus these were the dangerous T. nilotica species. So they arrested me. When I went before the judge with all the other criminals in orange jump suits, my lawyer explained to the judge the charges and the judge burst out laughing saying, “This is the crime of the F#@%&*g century” and let me off. So I was arrested but not convicted. It was shortly after that I realized a large tilapia industry was not going to happen in the U.S., and once again I looked offshore becoming a co-founder with Regal Springs Tilapia in Indonesia and Honduras. I kept my Florida hatchery going during that time through the good efforts of Jim Riggin, my partner in Aquasafra,Inc. It still supplies many U.S. tilapia farmers with their babies. I’m not using earthen ponds anymore, as Johnny Cash sang it, “I crossed the Man and the Man won!”
“People crushed by laws, have no hope but to evade power. If the laws are their enemies, they will be enemies to the law; and those who have most to hope and nothing to lose will always be dangerous.” Edmund Burke
An epilogue to this saga: A few years ago (2012) I had a conversation with a State Fisheries regulator about the genetic makeup of the wild tilapia in Florida public water bodies. I’m referring to the so-called T. aurea that the Florida Fish and Game released in the 70’s into the wild to eat algae. They said these were Tilapia aurea and they were expected to be pure line Tilapia aurea, obtained from Auburn University. Since the T. aurea were all over the state within 20 years, the Fish and Game reduced the burden of citizens requiring a permit for the species, but nobody wanted to grow T. aurea as a pure line. T. nilotica is the workhorse species for tilapia farming, but T. nilotica was still much feared by Florida regulators and required significant permitting. However, from the genetic testing study conducted on the wild tilapia in the various lakes in central Florida, it was discovered that the wild Tilapia aurea also had T. nilotica genes as well. They are hybrids. Due to the huge statistical number, the regulator concluded the “pure T. aurea” must have been a mixed species from day one. In effect, all this time the wild tilapia are hybrids of T. nilotica and T. aurea.
I was excited and expected this study would also free T. nilotica from so much regulation. Clearly, extensive permitting isn’t needed anymore since T. nilotica genes as well were widely established throughout Florida. However, you don’t hear about this study and the regulations still stand, regulating T. nilotica as an exotic rather than an established species. Inspections and restrictions continue, even though every major public lake and river from Central Florida to the Keys has hybrids with T. nilotica. A similar story is going on in California, banning T. nilotica and only allowing T. mossambica. But California is special, so I won’t go there with this article. We need a tilapia anti-discrimination movement to fit these litigious times we live.
It took another 30 years before the Florida tilapia farming industry and its other aquaculture industries were able to achieve some sanity in commercial production. Pioneers like Craig Watson of IFAS fighting for the rights of the tropical fish farmers and Paul Zajicek leading from the Florida Department of Aquaculture were key to bringing sanity to Florida Aquaculture. After studying regulations in other jurisdictions and finally settling on the ike the Norway model, Zajicek was able to streamline the permitting process and put it under one agency rather than five. The concept and model for the Fish and Game Commissions came from 1600’s England, during the time when regulators protected the King’s game. Everyone remembers stories of Robin Hood and the Sheriff of Nottingham in Sherwood Forest; the sheriff was a game warden!
Long before my experiences in Florida, I realized Florida and most of the U.S. did not want aquaculture. Florida real estate, and its water, was going to the established highest bidders: tourism, housing for Northern baby boomer retirees and agriculture concentrated on products of citrus, cattle and tomatoes.
So we buy 90 percent of our farmed aquaculture products from foreign producers. When these producers succeed at farming aquaculture products to export to the U.S., the few U.S. producers attempt to install some regulations to block these producers and to increase the value of their own production. For instance, the catfish industry’s so-called Farm Bill is trying for the eighth time to regulate catfish from Vietnam out of the U.S. markets. One of the world’s more successful industry leaders Charles Koch from Koch Industries is quoted as saying, “When a company is not being guided by the products they make and what the customers need, but by how they can manipulate the system—get regulations on their competitors, or mandates on using their products, or eliminating foreign competition—it just lowers the overall standard of living and hurts the disadvantaged the most.”
The impact and effects from rules and regulations on aquaculture producers is all encompassing. They are negatively impacting society and the consumers they are trying to protect. They determine so many of our choices, actions, reactions, efforts and behavior. They determine almost all of our economic activity, the foods we eat and the foods we cannot eat. In the seafood and aquaculture business, regulations are determining who can produce, what to produce, who can import, what, and even how much.. Most of all, creating rules and regulations has spawned an industry of workers (regulators) that get paid directly and indirectly to create and regulate these so-called laws. The world is getting larger, but the wealth is not being created or keeping up with demand, instead quality of life is worsening. There is an inverse relationship between the volume of regulations and the creation of wealth. More regulations, less growth, less wealth from production of goods and services. The laws, rules and regulations have so many unintended consequences that they must be reviewed and removed constantly.
These “laws” are hampering our creative abilities to develop solutions and products the world needs to survive.owadays, that without first discovering the rules we cannot move forward to know the action or solution. In fact, we cannot even create solutions in over-regulated environments
“Life, liberty, and property do not exist because men have made laws. On the contrary, it was the fact that life, liberty, and property existed beforehand that caused men to make laws in the first place.” Frederic Bastiat
Rules and regulations therefore determine who we are, what we can do and everything about our state of living from consumption to dealing with waste. It is the power of powers with a historical timeline, coming from almost no rules and regulations in our early history to 2015 with regulations expanding exponentially into every aspect of our lives. Regulations are determining the outcome of our efforts, they are the governing principles behind the law of unintended consequences. They create the platforms for political parties. What is it about rules and regulations that bothers individuals so much or bothers certain individuals more than others? These questions certainly seem to be one of the main issues that impacts individuals, societies and industries. In the seafood business (aquaculture included), it’s about resources, mostly natural resources. There are too many people chasing a diminishing amount of resources. So it seems natural there has to be regulations that regulate these resources. Is this possible? Is there a way to equitably and fairly regulate food or the resources required to produce food? A 200-year-old Frenchman was right when he said, “Laws are spider webs through which the big flies pass and the little ones get caught.” Honore de Balzac.
Mike Picchietti discovered tilapia farming while serving as a Peace Corps in Ghana and went on to become co-founder and President of Regal Springs Trading. With 33 years of experience, he is the owner of Aquasafra, Inc., America’s oldest and largest tilapia hatchery.