January 6, 2014
Taiwan milkfish farmers enjoy benefit of ''contract farming''
Buoyed by the contract farming through the Economic Cooperation Framework Agreement (ECFA) with China, milkfish farmers in Syuejia District, Taiwan, are able to sell their fish at a fixed price directly to the mainland.
In 2011 the Chinese mainland and Taiwan started the early harvest programme where milkfish can be exported to the mainland with a preferential tariff.
The mainland and Syuejia district started a scheme of "contract farming" which allows aquaculturalists to sell their product directly to the mainland importer, Shanghai Fisheries General Corp. Group, at a price fixed by contract.
"It has helped fish farmers a lot, and now they are queuing for a quota to join the scheme next year," said Wang Wen-tsung, the president of Tainan milkfish farming association which brokered the deal, explaining the "contract farming" not only cushions fishermen against drastic price fluctuations, but also moderates the market price.
This year, 125 fish farmers in Syuejia, some by renewed contracts, some by drawing lots, participated in the scheme, and each one had 18,000 kilogrammes of milkfish purchased through contract.
The contract price stands at TWD70 (US$2.33) per kilogramme, Huang says. Adjusted for production costs, he managed to earn a profit of some TWD10 (US$0.33) per kilogramme.
Wang Wen-tsung says because of the contract farming, middlemen can no longer dominate the market, thus avoiding exceptionally low prices. "When market price rises above contract price, we sell our fish to higher bidders."