As price of corn rises, catfish farms in US dry up

(Herald Tribune) -- The catfish industry is in free fall, unable to cope with the soaring cost of corn and soybean feed. Producers across the South are draining their ponds and wondering what comes next.

"It's a dead business," said John Dillard, who pioneered the commercial farming of catfish in the late 1960s. Last year Dillard & Company raised 11 million fish. Next year it will raise none. People can eat imported fish, Dillard said, just as they use imported oil.

As for his 55 employees? "Those jobs are gone."

Corn and soybeans have nearly tripled in price in the last two years, for many reasons: harvest shortfalls, increasing demand by the Asian middle class, government mandates for corn to produce ethanol and, most recently, the flooding in the Midwest.

This is creating a bonanza for corn and soybean farmers but is wreaking havoc on consumers, who are seeing price spikes in the grocery store and in restaurants. Hog and chicken producers as well as cattle ranchers, all of whom depend on grain for feed, are being severely squeezed.

Perhaps nowhere has the rise in crop prices caused more convulsions than in the Mississippi Delta, the hub of the nation's catfish industry. This is a hard-luck, poverty-plagued region, and raising catfish in artificial ponds was one of the few mainstays.

Keith King, the president of Dillard & Company, calculates that for every dollar the company spends raising its fish, it gets back only 75 cents when they go to market.

"What's happening to this industry is sad, but being sentimental won't pay the light bill," King said.

Dillard and other growers take their fish, still squirming, to Consolidated Catfish Producers in the hamlet of Isola, where workers run the machinery that slices them into filets. With fewer fish coming in, Consolidated Catfish is resorting to layoffs.

One hundred employees were let go in the last month, and an additional 200 will be cut soon. President Dick Stevens predicts that by the end of the year the company will have jobs for only 450, about half the number at its peak. That might not be enough to keep the plant open.

"The industry is going to implode," Stevens said. He blamed the government's ethanol mandates for making fuel compete with food for the harvest of the nation's farmland. "Politicians were in a rush to do something, and it became a terrible snowball."

Across the highway, one of the local feed mills, Producers Feed Company, has already shut down. The ripple effects have begun: between the grain mill and the fish plant was Peter Bo's Restaurant, locally celebrated for, naturally, its catfish. Hanging on the door is a "for rent" sign.