Document Type

Internship Report

Publication Date

Spring 2014

Abstract

Demand for high-grade yellowfin tuna is rising while the supply obtained from capture fisheries has remained steady. Developing an aquaculture yellowfin tuna operation will satisfy demand and reduce the need to obtain this valuable resource from the wild. An aquaculture group in the region of Puerto Vallarta, Mexico is in possession of the land, permits, and financial resources to fund such a project, and is willing to invest, provided that the operation is financially feasible. For my internship, I looked at production plans from hatchery to grow-out and developed a financial feasibility study for the commercial production of yellowfin tuna. The results of this study showed that for scaling a production from 305 to1,030 metric tons in 10 years, the operation will realize an Internal Rate of Return (IRR) of 3.20%, a Return on Investment (ROI) of 14%, a Total Net Cash Flow of $3,487,428.05 with positive net cash flows coming in at year 4, and a Payback Period of 9 years. While some of these metrics don’t favor the investment, it is important to consider the limitations of the project which are the assumption that the investment group has no infrastructure in place, such as boats, processing plants, sales channels, etc., and the valuation of the company once a spawning population of yellowfin are held in captivity and cages in the water. The risk involved in this project is high but with a bright future ahead as it will improve with rising demand, a stagnant wild capture supply, and constant innovation on tuna technology.

Comments

Department: MAF

MPS Track: AQU

Location: University of Miami Experimental hatchery

For UM Patrons Only

Share

COinS