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Certified Organic Shrimp: A New Approach to Mangrove PES?

This presentation by Jake Brunner from IUCN given during the Forests Asia summit in the discussion forum "Managing mangrove forests for climate change mitigation and adaptation benefits" introduces the integrated mangrove-shrimp approach, its markets, a brief history of PES and the weaknesses of this new approach.

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CERTIFIED ORGANIC SHRIMP: A NEW
APPROACH TO MANGROVE PES?
Jake Brunner, IUCN
Jakarta, May 2014
28%
70%
Ca Mau
50%
Vietnam’s Mangroves
January 2013
Nhung Mien Forest Management Unit
Integrated mangrove-shrimp
1. Low yield: 300 vs. 10,000 kg/ha/year
2. Low costs: no chemicals, feed, or antibiotics
3. Low risk: no crop failure in 2012
4. Diverse: crab, fish, oysters, etc.
5. Profitable: $2,100 vs. $1,100-$1,300/ha/year
Mangroves & Markets
• 2012-2016, BMU funding, IUCN and SNV
• Starting off with 740 farmers in Nhung Mien
• Minh Phu has signed 5-year contracts with
farmers:
– 10% price premium
– All sizes
• Organic standard: Naturland
– Requires 50% mangrove cover per national law
• Auditor: IMO, Institute of Market-Ecology
• Supports provincial vision of “organic coast”
PES brief history
• 1993-1998: Program 327 introduced household
protection contracts (VND/ha/year)
• 1998-2010: Program 661 (5 Million Hectare
Reforestation Program)
• 2006: USAID/Winrock/IUCN ARBCP in Lam Dong
• 2008: Decision 380 on piloting PES
• 2010: Decree 99 nation-wide, specified payments for
hydro (VND/KWhr) and water utilities (VND/m3)
• 2012: Work started on aquaculture PES decision
supported by IUCN and GIZ

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Certified Organic Shrimp: A New Approach to Mangrove PES?

  • 1. CERTIFIED ORGANIC SHRIMP: A NEW APPROACH TO MANGROVE PES? Jake Brunner, IUCN Jakarta, May 2014
  • 3. January 2013 Nhung Mien Forest Management Unit
  • 4. Integrated mangrove-shrimp 1. Low yield: 300 vs. 10,000 kg/ha/year 2. Low costs: no chemicals, feed, or antibiotics 3. Low risk: no crop failure in 2012 4. Diverse: crab, fish, oysters, etc. 5. Profitable: $2,100 vs. $1,100-$1,300/ha/year
  • 5. Mangroves & Markets • 2012-2016, BMU funding, IUCN and SNV • Starting off with 740 farmers in Nhung Mien • Minh Phu has signed 5-year contracts with farmers: – 10% price premium – All sizes • Organic standard: Naturland – Requires 50% mangrove cover per national law • Auditor: IMO, Institute of Market-Ecology • Supports provincial vision of “organic coast”
  • 6. PES brief history • 1993-1998: Program 327 introduced household protection contracts (VND/ha/year) • 1998-2010: Program 661 (5 Million Hectare Reforestation Program) • 2006: USAID/Winrock/IUCN ARBCP in Lam Dong • 2008: Decision 380 on piloting PES • 2010: Decree 99 nation-wide, specified payments for hydro (VND/KWhr) and water utilities (VND/m3) • 2012: Work started on aquaculture PES decision supported by IUCN and GIZ
  • 8. Weaknesses 1. Low willingness to pay – Buyers are state-owned companies that were instructed to pay; private hydropower plants reluctant because existing contracts 2. Potentially low compliance – Monitoring is based on self-reporting, raising questions about conflict of interest and credibility; government sees PES as welfare support 3. Doubts about permanence – New market opportunities (e.g., cassava) may make PES unaffordable; high and fluctuating opportunity costs
  • 9. Certification approach 1. Willingness to pay – International consumer is ultimate buyer; Minh Phu, the intermediate buyer, has identified organic shrimp as key market opportunity 2. Compliance – Forest management board, annual audits, internal control system in place, farmer groups encourage peer pressure, satellite monitoring 3. Permanence – Transforming the threat ; significant up-front costs (training, GIS, toilet kits, etc.) but incremental costs modest; strong financial incentive to stay certified