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BAY CITY -- It was a fishy situation, literally. Market prices for corn, cotton, rice, grain sorghum and cattle were in a slump. Seeking to diversify their operations, some producers along the Texas Gulf Coast tried their hand at raising catfish.
They quickly learned they could successfully raise catfish from fingerlings to marketable weight. But marketing proved to be a problem.
"I could raise the fish all right, but we only had one buyer in this area, and they couldn't always take all the fish we wanted to harvest," said Mark Shimek, who farms near Port Lavaca in Calhoun County. "So, I tried processing and selling my own fish. That was a messy and expensive proposition. We couldn't move enough fish that way."
Mike Hanson of Matagorda County faced the same situation.
"As more of us got into catfish, we realized that one buyer just wasn't going to cut it. We were waiting in line on the same buyer," he said. "That can push your production risk to unacceptable levels, because the longer your fish are in the water, the greater the odds of something going wrong. You need to harvest and market them when they are ready."
There simply had to be a better way. Shimek, Hanson and other catfish producers turned to Texas Cooperative Extension agents in Matagorda, Wharton and Calhoun counties.
"In 2000, we started getting calls from folks interested in raising catfish," said Logan Respess, former Extension marine agent in Matagorda County, now an Extension agent in Aransas County. "These folks needed help either getting started or improving a small, existing operation. And they needed help to establish a reliable marketing system . . . that was the common thread."
"We were already looking for ways to help producers diversify their operations and boost agricultural profitability and local economies," adds Brent Batchelor, Extension agent for agriculture and natural resources in Matagorda County. "We realized they could mount a watershed enterprise with tremendous economic potential if we could provide the right guidance and resources."
Batchelor and Respess went to work with Extension agents John O'Connell (Calhoun County) and Richard Jahn (Wharton County). They set up a series of educational workshops focusing on start-up needs, pond water quality and management, and fish health—using the expertise of Dr. Michael Masser, Extension fisheries specialist at College Station, among others.
"Our first meeting drew more than 110 producers, and from there it just snowballed," Masser said. "These producers have the land and water for catfish production, and they have a 300- to 310-day growing season. They can produce more fish at a lower fixed cost than catfish producers in Mississippi, Alabama, Louisiana or Arkansas."
With Masser's help, the agents put together and distributed educational materials and a newsletter on catfish production, and established partnerships with local and regional economic development representatives.
"I was looking for local start-up enterprises that we could put our weight behind," said Loy Sneary, a Gulf Coast farmer-rancher and economic development consultant with the Lower Colorado River Authority. "We saw right away that these folks had tremendous drive, resources and potential.
"Jobs are a key element here. Matagorda County has one of the highest unemployment rates in the state. That's why LCRA, several electric cooperatives, and city and county elected officials support this enterprise. We met with Texas Agriculture Commissioner Susan Combs, and she backed us wholeheartedly."
Judy Fort, a development specialist with the Texas Department of Agriculture, was assigned to work first-hand with the co-op. She provided expertise in grant writing, logo and label design, and Web site development.
Support for the enterprise grew to include the Wharton County and Jackson electric cooperatives, economic development corporations in El Campo, Matagorda County and Bay City, and the Coastal Plains Agri-Business Incubator.
With this momentum, in late 2001, producers formed the Catfish Association of Texas (CAT) and established a catfish section within the Texas Aquaculture Association, which provides trade support and an organized voice in dealing with governmental regulatory agencies.
Soon after the association was formed, the producers commissioned an economic feasibility study through Dr. Greg Clary, Extension economist at Overton and leader of the Texas Center for Rural Entrepreneurship. The center and Extension's rural entrepreneurship program help rural citizens develop business and marketing plans, secure loans, keep accurate books and meet government requirements.
"It was a chicken-and-egg scenario," Clary said. "What comes first, catfish production or a processing facility? Our survey of producers revealed they had the resources and ability to produce catfish in quantity, but needed a processing facility to integrate production with available markets. Catfish production is very attractive to producers who are facing reduced prices for other agricultural commodities. And they quickly recognized Texans consume more aquaculture products than they produce."
The positive feasibility study provided the impetus for 31 producers to form the Texas Aquaculture Cooperative in the fall of 2002. Shimek is the co-op president and Hanson is vice president. They began processing their local catfish harvests in a building donated by Harold Bowers of Bowers Shrimp Company in Palacios.
Peter Woods became the Extension fisheries program specialist in the summer of 2002 and began working with co-op members to improve and expand their production ponds. He has helped growers produce 8,000 to 10,000 pounds of fish per acre. Most co-op members have several 8- to 10-acre ponds.
A few months later, with a business and marketing plan in hand, co-op members pooled $415,000 of their own start-up capital and built a 5,250-square-foot processing facility near Markham. The plant can process 150,000 pounds of fresh catfish per week.
The plant churned out more than 867,000 pounds of catfish in the last year and employs 24 full-time workers.
"We aren't running at full capacity right now, but that will come in time," said Troy Shimek, general manager of the co-op. "We process one to three 25,000-pound truckloads of fresh fish per week. The producers call us when they have fish ready to harvest and then we get moving.
"We sample fish from the pond and conduct a taste test. If the fish are ‘on-flavor,' we send a crew out to seine the pond. Then we truck the fish to our plant."
Most of the catfish weigh between 2 and 10 pounds. After processing, they are packed and shipped to buyers as close as Houston, the largest nearby market, or as far away as California.
"Producing catfish through the co-op is definitely profitable," said producer Steve Klingaman. "I am a small producer compared to some of the others. It cost me $4,500 per acre to establish my ponds, but I am already seeing a return. The co-op pays me 62 cents per pound, live weight, on the pond bank when I harvest my fish."
The co-op recently received a $245,000 matching grant from the U.S. Department of Agriculture for working capital to add frozen catfish to their array of available products.
Plans are also under way to expand the processing plant by adding a cold storage freezer and a freezing tunnel.
"An Individual Quick Frozen tunnel freezes the product very quickly, without any loss of taste or texture," Woods explains. "With this technology, our producers will be set to expand their sales-marketing base beyond the fresh fish market and put more ponds into production.
"Texans consume about 45 percent of all the catfish produced in the United States, but we produce less than 2 percent of all that catfish. We're out to change that. Our next goal is to increase pond acreage from 1,500 to 2,000 acres by the end of 2004. With the dedication, drive and commitment these guys have, I have no doubt we will make it."
For more information on the catfish cooperative, check these Web sites: http://www.texascatfish.com/ and http://www.tcre.org/