Hyper-intensive shrimp farms based on recirculating aquaculture systems (RAS) have been promoted in recent years as a major opportunity to produce closer to market, reduce sanitary risks, and increase control over the production process.
However, their high capital requirements—estimated at USD 30 million for a 1,000-tonne facility —and operational complexity continue to raise questions about their real economic viability.
A recent study published in Aquaculture addresses this issue through a bioeconomic model applied to a representative whiteleg shrimp (Litopenaeus vannamei) farm producing 1,000 tonnes per year in a super-intensive RAS.
The analysis jointly incorporates production risk, market risk, and the probability of system failure—an aspect that has received limited attention in previous assessments of this technology.
Profitability is possible, but only under strict conditions
Under a deterministic scenario, the model suggests that a farm of this type could achieve post-investment production costs of USD 7.21 per kilo. At this efficiency, the farm generates positive cash flow with an investment payback period of approximately 5.5 years. Over the long term, and assuming historical average prices, the project appears economically viable.
However, once real-world uncertainty is introduced, the picture becomes significantly more complex.
The study’s most striking finding is that shrimp price volatility accounts for 86.3% of profit variance, far outweighing production factors such as survival rate, harvest weight, or feed conversion ratio. In other words, even in a highly controlled system, market dynamics remain the dominant source of economic risk.
Without active price-risk management strategies—such as forward contracts or product differentiation—the profitability of hyper-intensive RAS shrimp farms remains highly exposed to unfavourable market cycles. Interestingly, the study notes that if producers successfully fix their sales price (removing market volatility), the risk does not disappear but shifts: feed price volatility then becomes a significant concern, accounting for 28.8% of the remaining profit variance.
The '2023' Reality Check
The danger of this market exposure is best illustrated by the study’s "2023 scenario." When the model is run using the low market prices observed in 2023 rather than historical averages, the projected profit per cycle collapses from USD 1.71 million to just USD 0.63 million.
Under these depressed market conditions, the farm would be unable to recover its initial capital investment of USD 30 million within ten years, despite operating efficiently. For investors, the message is that entering the market at the wrong point in the price cycle can render the high CAPEX of RAS projects unrecoverable in the medium term.
Technology’s weak point: The 'Coin Toss' scenario
The second major risk identified does not primarily affect profit variability, but rather expected returns: system failures. While proponents often highlight biological security, the mechanical risk is substantial.
The model incorporates a scenario where 20.13% of production cycles encounter a failure leading to total crop loss.
The financial impact is severe, with the average profit per cycle dropping by one-third, falling from USD 1.64 million to USD 1.09 million. Most critically, the probability of the project recovering its initial investment within ten years falls to just 57.59%
Essentially, without extreme reliability, the financial success of a USD 30 million high-tech facility becomes little more than a coin toss.
The study concludes that hyper-intensive shrimp farms using RAS can be profitable, but financial viability depends on a dual strategy: implementing robust price management to mitigate market volatility and investing in reliable technology to reduce operational risks.
In short, technology can reduce biological and environmental risks, but it does not eliminate economic risk. For investors and developers considering RAS-based shrimp production, the message is clear: commercial strategy and timing matter just as much as system design.
Reference:
Liu, L., & Asche, F. (2026). Risk analysis for shrimp in a recirculating aquaculture system. Aquaculture, 614, 743467. https://doi.org/10.1016/j.aquaculture.2025.743467
Latest news
-
-
Storm Kristin causes severe damage to Portuguese aquaculture
Portugal, 3 February 2026 | The Centre region and the Algarve have been affected, according to the Portuguese Aquaculture Association
-
