An Early Assessment of the Feasibility of Chinese Tilapia Farms to Comply with the Aquaculture Stewardship Council Tilapia Standard.

Transcription

1 An Early Assessment of the Feasibility of Chinese Tilapia Farms to Comply with the Aquaculture Stewardship Council Tilapia Standard. Aaron A. McNevin, Ph.D Independent Consultant 267 Mt. Tabor Rd. Gardners, PA USA EXECUTIVE SUMMARY The Aquaculture Stewardship Council (ASC) is currently providing opportunities for tilapia farms to become certified against the ASC Tilapia standard. The interest is high in major tilapia production areas to determine the feasibility of farm operations to meet the compliance requirements of the standard. To address the concerns surrounding feasibility and to support the ASC s efforts to provide environmental betterment in key areas interest, WWF-China, WWF-US and the China Aquatic Products Processing and Marketing Alliance (CAPPMA) partnered to develop a feasibility study of 8 tilapia farms currently engaged in exporting to a variety of countries around the world. This study was funded by the European Commission with the goal of providing better insight and a clearer roadmap for tilapia producers in China to achieve ASC certification. The study area was restricted to southeastern China where a larger proportion of the export-oriented tilapia production occurs. The assessment team spent between 1-2 days with farm management and staff, but also conducting inspections of farms. A total of 227 compliance points were assessed for each farm. Specific trends in performance and ability to achieve compliance for these points were analyzed. Further, specific recommendations were provided for common issues shared by all farms. More specific information on individual farms and the key adjustments necessary to comply with areas of noncompliance provided in detailed assessment documents in appendices to this report. Overall, farms were not well prepared for the assessment and resulted in a poor collective compliance rate. There were a total of 227 compliance points that are required to obtain certification, and on average farms met 168 of the points with a standard deviation of 20. Of course, the process was as much about learning about the standard as was evaluating compliance. Across farms, the performance was slightly variable with an average compliance rate of 74% for all points in the standard. The minimum and maximum compliance rates were 57 and 84%, respectively.although variability was moderate in comparing overall performance of farms, a higher magnitude of variability was observed when noncompliance rates were compared across principles. Compliance rates under the legal and fish health were the least challenging, while compliance points under the feed category proved most difficult. There is reason to suspect that some tilapia farms in China can achieve ASC Tilapia certification. Those farms that are most apt to gain certification are those that do not have receiving waters and those that can show a strong partnership and level of cooperation with feed manufacturers. Those farms that meet the feed requirements of the standard but have receiving waters are not considered incapable of achieving ASC certification; however, there ability to meet the standards may largely depend on the environmental condition of the receiving waters. The receiving water condition will only be determined by appropriate monitoring over the long-term such to show that negative impacts are not beyond the limits defined in the standard. 1 P age

2 BACKGROUND In December 2009, the Tilapia Aquaculture Dialogue (a multi-stakeholder group of tilapia producers and processors, non-governmental organizations (NGOs), feed manufacturers and government representatives) finalized a set of labelling standards that were transferred to the ASC in 2010 for final ownership and management. The ASC has contracted Accreditation Services International (ASI) to conduct training and accredit certification bodies such that these bodies can conduct compliance audits against the ASC Tilapia standard. Presently, auditors from various certification bodies are being trained to audit tilapia farms against the ASC standard and some farms have received the certification. As China is the world leader in tilapia production, it is of interest by the sector to understand and determine the feasibility of Chinese farms meeting the requirements of the ASC Tilapia standard. Further, WWF-China has an interest in broader adoption of the ASC Tilapia standard in an attempt for environmental betterment. Thus, through a grant from the European Commission, WWF-China has partnered with CAPPMA to seek ASC certification for some Chinese tilapia farms. An initial scoping of the feasibility of 8 selected Chinese tilapia farms to meet ASC certification was subcontracted to a consultant (the author) to provide detailed information regarding the ability of Chinese operations to attain ASC certification and to identify challenges to meeting the standard. The purpose of this document is to provide an overview of macro-level findings on compliance across all farms assessed. Following this overview, a more detailed explanation of all tilapia farms assessed is provided with separate appendices to the report for each of the 8 farms including completed audit sheets and a narrative highlighting gaps and suggestions/ recommendations for how to reach standard compliance. ASSESSMENT PROCESS The consultant, with representatives from CAPPMA, WWF-China and WWF-US, tilapia farms in southern China from the period of August A total of 8 farms were assessed in southeastern China (Figure 1). It was attempted to spend 2 days with farm management at the production site, but a typhoon limited some of the travel and one farm (Huazhou Shitan Vegetable and Aquatic Farm Base) could not be visited because of flooding. The assessment group was able to meet with this farm s management to discuss issues related to the ASC standard and an assessment is provided based on information gathered at those meetings. All other farms were visited with durations lasting from 1-2 days per farming operation. A list of farm companies, locations, production method, production area and annual production is provided in Table 1. Farm numbers provided in Table 1 (first column) will be used for the remainder of this document to identify specific farming operations. Figure 1. General location of the 8 tilapia farms assessed in southeastern China. 2 P age

3 Table 1. List of farms and basic characteristics assessed for compliance with the ASC Tilapia standard in August 2013 (ha hectares; MT metric tons). Hybridized reservoir is considered an irrigation reservoir with many inlets in which producers net off areas of the reservoir to form multiple culture impoundments. In all cases of hybridized reservoirs, the entire reservoir was utilized as an aquaculture system. No. Company name Location Production method Farm size (ha) Annual production (MT) 1 Gaoyao City Evergreen Aquatic Product Science and Technology Company. Ltd. Lian Tang, Gaoyao Hybridized reservoir 132 1,000 2 Huazhou Shitan Vegetable and Aquatic Farm Base Shitan, Huazhou Ponds Zhanjiang Evergreen Aquatic Product Science and Technology Company. Ltd. Hetou, Zhanjiang Ponds Guangxi Nanning Baiyang Food Co., Ltd. Xiangtang, Nanning Hybridized reservoir ,000 5 Chengmai Xingyuan Development Group Renxing, Hainan Hybridized reservoir 100 2,800 6 Hainan Qinfu Industry Co.,Ltd Jinshan, Hainan Ponds ,440 7 Hainan Sky-Blue Ocean Foods Co., Ltd. Boafang, Hainan Ponds Hainan Sky-Blue Ocean Foods Co., Ltd. Huishan, Hainan Cages in reservoir 133 3,000 3 P age

4 The assessment process consisted of inspection of farm operations, document confirmation and interviews with management and employees. All information that was obtained from farm management was considered to be truthful and honest. It is important to note that auditors would be more thorough in the investigations during the audit. The assessment team used the ASC Tilapia Auditor Manual as the comprehensive tool for compliance determination. An example of the tool is provided in each individual farm-specific appendix. Although all farming operations were treated in the same manner (with the exception of No. 2), farm management chose the personnel of the operation to be present at assessment meetings which allowed for either more or less detailed information. Further, some producers were better prepared for the assessment process than others, and there are numerous instances in which farms acknowledged they did not have appropriate data or information, but conveyed the capability of obtaining such data or information. For the purposes of this report, the capabilities to obtain appropriate information were treated as noncompliances. GENERAL ASSESSMENT OUTCOME Overall, farms were not well prepared for the assessment and resulted in a poor collective compliance rate. There were a total of 227 compliance points that are required to obtain certification, and on average farms met 168 of the points with a standard deviation of 20. Of course, the process was as much about learning about the standard as was evaluating compliance. With this in mind, the reader should note that many of the compliance points in the ASC Tilapia standard require monitoring in advance of an audit, thus much of the monitoring data was absent. Further, some of the documentary evidence required demands agreements with feed suppliers, processing plants and hatcheries. Although farms were not well prepared, there is strong potential for some Chinese tilapia farms to meet the requirements of the standard if several issues are appropriately addressed. Across farms, the performance was slightly variable with an average compliance rate of 74% for all points in the standard. The minimum and maximum compliance rates were 57 and 84%, respectively (Figure 2). 1.0 Percentile fraction Farm 1 Farm 2 Farm 3 Farm 4 Farm 5 Farm 6 Farm 7 Farm 8 Figure 2. Overall compliance rates for each farm assessed. Green indicates compliance and red indicates non-compliance. The total number of compliance points possible was P age

5 Of the 8 farms assessed, Farm 5 and Farm 6 had no observable receiving waters which eliminated the need to comply with many of the water resource compliance points. The non-applicability of these compliance points resulted in a higher rate of compliance for these two farms. The differences between Farms 7 and 8 were owned by the same parent company, thus documentation and performance were based on similar management regimes resulting in a similar compliance rate. This was not the case for Farm 1 and 4 which was also owned by the same parent company. However, Farm 1 did not have as much time to prepare for the assessment as Farm 4 and it would be expected that these farms would be more similar if the same amount of time to prepare was afforded to Farm 1. Farms 4, 5, 6, 7 and 8 had more information available on the species or genus of fish that was used as the source for fish meal and oil ingredients in feed. This information provided a higher compliance rate for compliance points associated with feed resources. Although variability was moderate in comparing overall performance of farms, a higher magnitude of variability was observed when non-compliance rates were compared across principles. Compliance rates under the legal and fish health were the least challenging, while compliance points under the feed category proved most difficult (Figure 3) Percentile fraction Legal Siting WaterResources Biodiversity Feed FishHealth Social Figure 3. Overall non-compliance rate for all farms grouped by principle. Error bars represent standard error and numbers above bars account for the total number of compliance points per principle. 5 P age

6 It is useful to analyze more specific information on indicators and compliance points to identify crosscutting trends in non-compliance. There were only 13 indicators that all 8 farms showed non-compliance; however, these 13 indicators were restricted to principles on feed, water resources and social issues (Table 2). This provides some insight on where the most difficulty arose. It also informs that aside from these 13 indicators, Chinese tilapia farms can achieve most compliance points. Of course, some farms performed better in certain areas of the standard than other farms, but with the exception of the 13 indicators, all compliance points can be achieved. This is likely reassuring information for producers that assumed the ASC standards were too stringent for the Chinese tilapia industry. Nevertheless, the compliance points failed by all farms require further analysis to determine the feasibility of producers achieving ASC certification. Feed Ingredients As previously stated, compliance with aspects associated with feed resources were the greatest challenge to the producers assessed. This is partly a result of producers not providing the documentation showing a commitment (indicator 5.1.3) to purchase feeds that contain wild fish products originating from fish stocks that have achieved ISEAL accredited labeling for responsibly managed fisheries (i.e., Marine Stewardship Council). Additionally, indicator addresses the requirement to obtain a copy of the feed manufacturer s sustainability and traceability policies with regards to sourcing raw ingredients. It is clear that the intent of this portion of the standard is to try to leverage feed manufacturers to account for the source and location of raw ingredients. Many feed manufacturers already have this information, but it is challenging for them to provide this information to those outside of their company. Nevertheless, it is interesting that Farm 1 and 3, Farm 4 and Farms 7 and 8 are all integrated with a feed manufacturer which should make this information easier to provide to farming operations in confidence. Of course, this may provide a greater challenge to those farms that are not integrated with feed manufacturers. It is recommended that producers work closely with feed representative to foster a greater amount of trust and to convey the necessity for these documents to obtain ASC certification. Energy Although there is no limit on the amount of energy that can be used on a farm, the ASC Tilapia standard does require a budgeting of these resources. Indicator requires farms to calculate and report on the total amount of energy used per metric ton (MT) of tilapia produced per year. It also requires farms to identify the specific energy source (i.e., coal, hydropower, wind, oil, etc.) for each budgeted line item of energy used. This information is not challenging to obtain, and the quantification of the amount of energy used would also provide farm management an analysis of areas that are least efficient in energy. Social Social and labor requirements of the ASC Tilapia standard account for the most compliance criteria of any principle (66 compliance points). It is understandable that there would be some issues that farms would need to address. The key areas of non-compliance are: 1. a documented and implemented policy on the prevention of discrimination against those who are HIV positive (7.3.1 d); 2. a policy in place that describes how the company addresses and responds to discriminatory issues raised by employees (7.3.2 a); 3. the freedom of association and the right to collective bargaining (7.6.1 a and b); and 6 P age

7 Table 2. Indicators (Ind.) and compliance points (CP) ranked in order of most number (#) of farms failing to comply. Indicators and compliance points where no farm failed to comply are omitted. Readers should refer to the ASC Tilapia Auditor Manual found at the following URL: Principle Ind. CP # Principle Ind. CP # Principle Ind. CP # Principle Ind. CP # Feed a 8 Biodiversity c 6 Social a 5 Water 3.1.2A a 2 Feed b 8 Biodiversity a 6 Water a 5 Water 3.1.2A b 2 Feed c 8 Biodiversity b 6 Water b 5 Water 3.1.2A c 2 Feed d 8 Biodiversity c 6 Water d 5 Health d 1 Feed e 8 Feed b 6 Feed a 4 Health a 1 Feed a 8 Feed c 6 Feed b 4 Health d 1 Social d 8 Siting a 6 Feed c 4 Health e 1 Social a 8 Siting a 6 Feed d 4 Health a 1 Social a 8 Siting a 6 Feed e 4 Health b 1 Social b 8 Siting b 6 Feed b 4 Health a 1 Social b 8 Siting c 6 Feed c 4 Health b 1 Water e 8 Siting d 6 Biodiversity a 3 Health c 1 Water f 8 Siting e 6 Biodiversity b 3 Legal b 1 Water 3.1.2A d 8 Siting a 6 Feed a 3 Social a 1 Water 3.1.2A e 8 Siting b 6 Feed d 3 Social c 1 Water 3.1.2B f 8 Siting c 6 Health a 3 Social d 1 Water e 8 Siting f 6 Health c 3 Social g 1 Water f 8 Feed a 5 Social a 3 Social b 1 Water d 8 Feed b 5 Social d 3 Social a 1 Water e 8 Feed c 5 Health b 2 Social b 1 Health c 7 Health b 5 Health c 2 Social c 1 Legal d 7 Legal a 5 Health b 2 Water d 1 Social b 7 Siting a 5 Social a 2 Social a 7 Siting b 5 Social b 2 Social b 7 Social a 5 Social c 2 Biodiversity a 6 Social c 5 Social b 2 Biodiversity b 6 Social d 5 Social a 2 7 P age

8 4. the requirement for conflicts that arise with workers to be addressed and resolved in a 3-month time frame (7.8.3 b). Points 1, 2 and 4 are issues that can be resolved by developing managerial and company policies but also effective implementation and training at workplace. Additionally, there will be a need for employees to show competence in understanding the policies that are put forth by any company. The ineffective conveyance of knowledge of a specific company policy will be deemed non-compliant. The greatest challenge will be point 3, freedom of association and collective bargaining. In China, there is the ability to freely form advocacy groups inside companies, but the ability to strike from work is only allowed by law through application and formal authorization from the government. This is clearly an issue of non-compliance for producers in China; however, under principle 1 (obey the law), there is a clear contradiction between the compliance points associated with freedom of association and the compliance point showing that producers obey governmental law. This issue will likely need to be raised with ASC to determine a resolution that is appropriate. Water Resources Under the water resources principle (3), there are a series of calculations on utilization of nutrients that are required to be calculated, even if there is no receiving waters as the intent of the compliance points was to allow for more universal characterization of farm-level efficiencies. No farm had completed these calculations, but they are simple in nature if there is accurate accounting performed at the company. Receipts of fish purchases and sales as well as feed purchases and fertilizer purchases should be maintained on the farm site because accompanied by appropriate documentation of feed or fertilizers, the farm can create a nutrient budget. A simplified budget is provided in Table 3. Table 3. Nutrient budget worksheet for inputs and outputs of nutrients from farms for ASC Tilapia standard (Standard to 3.1.4). Feed A Fertilizer A Fertilizer B Other Percentile Fraction P Percentile Fraction N Total Input (kg) Prior 12 months Total P In (kg) Total N In (kg) Grand Total Input (GTI) Production Period Fish Production for Prior 12 months* (mt) P Removed at Harvest N Removed at Harvest Grand Total Out (GTO) P Grand Total Out (GTO) N MM/YY to MM/YY [Current standing stock** + fish harvested initial standing stock] x Fish Production (mt) 21.2 x Fish Production (mt) GTI P removed at harvest GTI N removed at harvest Total in/mt fish/yr Total out/mt fish/yr *Prior 12 month period ** At time of audit GTI kg P /mt fish produced /yr GTO kg P /mt fish produced /yr GTI kg N /mt fish produced /yr GTO kg N /mt fish produced /yr Compliance points A-C are the step-wise data entry required to develop the above nutrient budget, and compliance points e and f and d and e are the verification of the accurate nutrient budget that is reviewed by the auditor. The remaining compliance points have been shown to be achieved by some of the 8 farms assessed, and rather than an exhaustive review of all points that show non-compliance, each specific point where a farm did not comply is followed by a narrative on how the farms can adjust their operations to comply in farmspecific appendices following this report. 8 P age

9 CONCLUSIONS While there are numerous non-compliance issues shared among all farms, there are mechanisms and changes that can be adopted to address all points considering there is a reasonable solution to the issues surrounding freedom of association and the right to collective bargaining. It is also important to note that although farms will attempt to collect and provide appropriate data on the issues related to receiving waters (where appropriate), feeds, biodiversity and effective managements, the collection of these data do not constitute compliance. Rather, where numerical performance targets are identified in the ASC Tilapia standard, the data collected by the producer and the auditor will be required to show achievement of the performance targets. There is reason to suspect that some tilapia farms in China can achieve ASC Tilapia certification. Those farms that are most apt to gain certification are those that do not have receiving waters and those that can show a strong partnership and level of cooperation with feed manufacturers. Those farms that meet the feed requirements of the standard but have receiving waters are not considered incapable of achieving ASC certification; however, there ability to meet the standards may largely depend on the environmental condition of the receiving waters. The receiving water condition will only be determined by appropriate monitoring over the long-term such to show that negative impacts are not beyond the limits defined in the standard. 9 P age

10 APPENDICES The appendices that follow provide specific detail on the individual farms assessed in this study. Also, included is specific company information that should be treated in accordance with agreements between WWF-China, CAPPMA and the individual producers. Each appendix includes an overall compliance rate of farm grouped by principle, a satellite image of the farming operation, an equipment list with specific requirements, the pre-audit requirements for the farms assessed and the compliance points with specific instruction of adjustments or documentation necessary to show compliance. The compliance documentation was developed such that a score of 0 was provided if the farm was in compliance with a specific point, a score of 1 if the farm was not in compliance and NA was included in cases where the compliance point was not applicable to the farm. 10 P age