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Malaysian shrimp culture.

Malaysian shrimp culture has begun to succeed commercially after suffering Years of heavy financial losses. improved aquaculture methods and the commitment of a few large companies are largely responsible for the turnaround. Malaysian production, mostly of giant tiger prawns', Penaeus monodon, was 1,260 metric tons (t) in 1987, almost five times the 1986 harvest of Z70 t. Estimated 1988 production was 1,800 t. In 1987, Malaysia produced 300 million shrimp post larvae for stocking growout ponds. Production of post larvae in 1988 was estimated at 360 million. Malaysia's post larvae production exceeds domestic shrimp farmers' needs, and the surplus is exported-about 78 million in 1987 and an estimated 11 million in 1988. About 80 percent of the Malaysian shrimp culture production is exported, mostly to Singapore, Japan, the United States, and Europe.

Production Malaysian shrimp farmers harvested 1,260 t of shrimp in 1987, nearly five times the 1986 production (Table 1). Of this total 760 t were produced in peninsular Malaysia, and 500 t were produced in Sabah, East Malaysia. The estimated 1988 crop was 1,800 t, with 1,000 t produced in peninsular Malaysia and 800 t produced in Sabah. There are currently about 230 farms operating in Malaysia, covering a total of about 730 hectares (ha). In peninsular Malaysia, 190 farms are operating on 560 ha, and in Sabah, 36 farms cover about 170 ha. The Malaysian Government has targeted a total of 22,000 ha of mangrove swamp for development into aquaculture ponds, which are expected to yield 21,000 t of shrimp by the year 2000.

Most (about 85 percent) of the cultured shrimp produced in Malaysia are giant tiger prawns, and the remaining 15 percent are banana prawns, P merguiensis. Both are grown in brackish water ponds.

Development Potential

Between 1986 and 1988, the government approved 36 shrimp aquaculture projects with a proposed investment of $122 million. Of this total, 23 projects, worth $102 million were approved in 1988 alone, indicating a dramatic rise in the stock of Malaysian aquaculture. If all 36 projects are completed, their combined production will be about 30,000 t annually, surpassing the government's official annual production goal of 21,000 t by the year 2000. Many of the projects are joint ventures with Taiwanese partners. Some of the larger projects have their own hatcheries, and some are integrated with processing plants. Projects have been sited in Sabah, as well as the states of Johore, Pahang, Trengganu, and Kelantan on the east coast, and Selangor, Perak, and Kedah on the west coast of peninsular Malaysia.

Corporate Investments

Three major corporations have located projects within a very small area at Kuala Sedili, in the state of Johore. They are: the Johore State Economic Development Corporation, which runs the East Asia Marine Farms (EAMF); the Anglo-Dutch Unilever Corporation; and the Lion Corporation, which also has shrimp farms in Malacca and Sabah, through holdings of its subsidiary, Aquabio.

U.S. Embassy officials in Kuala Lumpur recently visited the EAMF project and talked with its managing director, Ahamad Bin Mohamed. EAMF produced 420 t of shrimp on 200 ha (50 ponds of 4 ha each) in 1988 and is predicting 1989 production of 660 tons. It is expanding its Kuala Sedili operation by another 200 ha and is building a 450 ha farm near Mersing, Johore, for $18 million. EAMF uses the semi-intensive culture method, which has consistently yielded 600-700 kg of shrimp per ha annually in Malaysia. However, EAMF achieved yields of 915 kg per ha in 1988 and is currently producing 1,200 kg per ha annually. The company's goal is 2,000 kg of shrimp per ha, and it already has some ponds producing above this rate. EAMF's harvesting cycle is approximately 4 1/2 months for each pond. Most of its efforts for increasing productivity are focused on reducing turnaround time; its equipment for cleaning and repairing ponds after harvesting becomes inoperable in the frequent rains.

EAMF currently imports shrimp feed from Taiwan but is constructing its own feedmill. Feed accounts for about 60 percent of production costs in Sabah and 40-50 percent of production costs in peninsular Malaysia. Sabah has recently announced that it will embark on a feed mill joint venture with an unnamed foreign partner.

EAMF is vertically integrated, with its own hatchery and processing plant. It would like to process shrimp from other projects, but currently a substantial percentage of Malaysian shrimp are shipped live for processing to Singapore where they command higher prices. EAMF processes and freezes its shrimp for shipment to Japan where they are marketed under both premium-brand and general-brand names.

According to EAMF's managing director, the Kuala Sedili-based Unilever and Lion shrimp farms have just gone into production. At present, Lion's farm is producing 2 t per month, and Unilever is producing 1 t per month. Lion's shrimp farms in Malaysia are expected to harvest a total of 100-150 t in 1989. The company plans to expand from the current 40 ha in production to over 1,200 ha within the next 5 years. Press reports state that the Unilever project will eventually cover 1,000 ha (150 ponds), yielding 1,200 t per year. Unilever's total investment is expected to be $39 million.

The increased profitablity of shrimp culture in Malaysia is largely because of better siting. Previous projects often failed because ponds were located in mangrove areas where pond excavation resulted in a level of water acidity that is lethal to shrimp. In contrast, the Kuala Sedili projects are located on a tidal river at the edge of a mangrove area where the soil is more suitable.

Despite identical siting, however, there is strong disagreement among the three companies on the best production methods. The Unilever project has higher capital costs because the company lines its ponds with concrete and uses more expensive pumping equipment. The American farm manager for EAMF believes these costs are unnecessary, citing a previous Unilever failure in Sri Lanka. However, an industry source (not associated with any of the three companies) believes that EAMF and Lion risk failure precisely because their less expensive approach leads to costly pond maintenance and significant down time.

Other than feed, the greatest expense for all three projects is the pumping of thousands of gallons of brackish river water in and out of the ponds to maintain proper oxygen levels and to flush them of waste. According to EAMF'S, Ahamad, while the government is still endorsing the use of mangrove land for aquaculture, the cognoscenti in Malaysian aquaculture will be setting up on sites similar to Kuala Sedili. The east coast is dotted with relatively unpolluted tidal rivers with adjacent state land theoretically available for aquaculture.


At present, 32 shrimp hatcheries are registered with the Malaysian Fisheries Department (23 in peninsular Malaysia and 9 in Sabah). Post larvae production in 1997 was 300 million (240 million in peninsular Malaysia and 60 million in Sabah). Estimated 1988 post larvae production is 360 million (280 million in peninsular Malaysia and 80 million in Sabah). Although 78 million post larvae were exported in 1987, it is estimated that only about 11 million were exported in 1988. The reasons for this decline are not known. The major foreign markets for Malaysian post larvae are Sri Lanka, Oman, Pakistan, Hong Kong, Italy, China, and Thailand.

Sabah dominates production of wild tiger prawn broodstock in Malaysia. Live gravid females sell locally for between $58 and $110, with prices going as high as $1,820 in Taiwan, the major export market2. (Tiger prawns accounted for 70 percent of Taiwan's shrimp exports to Japan and 29 percent of Southeast Asia's shrimp exports to Japan in 1987). Malaysia has banned the export of gravid shrimp, but smuggling them out of the country through Singapore is reportedly common.


The Malaysian National Prawn Research Center was completed in 1987 with a $8.4 million grant from the Japanese Government. It has also received assistance from two Japanese aquaculture experts supplied by the Japanese International Cooperation Agency. The Center has cut shrimp post larvae production costs by 50 percent over the last 5 years, from $0.015 per fry to $0.007. A new technique for mass production of post larvae through induced spawning was developed at the Center and is being applied in most of Malaysia's hatcheries.

Government Incentives

The Malaysian government assists the shrimp culture industry through the Department of Fisheries, which provides advice and technical assistance. Shrimp culture firms are also eligible to receive the tax rebates and tax relief, which the Malaysian government provides to most developing industries. A 5 percent investment tax credit is extended to all shrimp culture investors, i.e., 50 percent of the first 5 year's qualifying capital expenditures may be deducted from taxable income. These expenditures include the clearing of land, pond construction, the purchase of plant and machinery, and building construction. investors may also borrow from the government's new low-cost investment fund at reduced rates or benefit from a reduced interest rate export credit refinancing scheme.


Malaysia will be pushing to join the ranks of major Asian shrimp producers over the next 10 years. Prospects are bright for continued investment now that the larger companies are beginning to demonstrate that shrimp aquaculture can succeed commercially in Malaysia. Whichever production method is employed, potential large players, such as plantation companies and state economic development corporations with foreign joint-venture partners, are likely to move into the shrimp culture business. (Source: IFR-89/50. Prepared by Karen Kelsky and Paul Niemeier of the NMFS Foreign Fisheries Analysis Branch, Silver Spring, MD 20910.)
COPYRIGHT 1989 U.S. Department of Commerce
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Copyright 1989 Gale, Cengage Learning. All rights reserved.

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Publication:Marine Fisheries Review
Date:Jun 22, 1989
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