University of Guelph

The Future of Saltwater Crocodile Farming

in Canada
 Maddy Cherevaty
AGR*1110
Austin Bruch___
November 27, 2018
Table of Contents

Crocodile Farming
Description 2
How it’s Farmed 2
Infrastructure 2
How its Processed 3
Inputs and Cost of Labour 4
Niche Market 6

Benefits
Benefits to Canada 6

Environmental Benefits 7

Sustainability 7

Economic Breakdown
Transportation Logistics 8
Cost Analysis 8

International Factors
Competition 9
Trade
Tourism

Real World Factors

Company Interference

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 Creative Marketing Strategy
Future Studies Needed

Crocodile Farming

Description

Saltwater crocodile farming is an industry that specializes in the breeding and raising of

saltwater crocodiles in order to produce goods such as meat, hide, oil and other

miscellaneous crocodile goods, (Northern Territory Government, 2015).

How it’s Farmed

The main method Canadian farmers should focus on is captive breeding. Captive

breeding is the raising, reproducing and processing of crocodiles all within a captivity.

There are two options for captive breeding, one in which the safety of crocodile

populations worldwide is the primary concern and objective, and the other in which the

main concern is for sustainable market production, (Grahame J. W. Webb, Hollis, G., &

Manolis, S., 1991). While traditionally the main product desired from crocodile farming

was their skin leather, other products like meat, oil, and tears can also be profitably

harvested, (MacGregor, J.,2006).

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Infrastructure

The main concern of crocodile farming

in Canada is constantly changing and

often colder climate. The number one

solution to address Canadian climate

issues is geothermal water sources.

Geothermal water sources are known

globally for their electricity producing characteristics, however, they can also easily

solve problems related to crocodilian farming in Canada. Basically, farmers can utilize

geothermal waters as their direct water source or in instances when temperatures are

low, or they can be used below or around their primary water sources when the water

has a higher temperature. Not only would this allow crocodiles to thrive in cooler

climates, but it also benefits the farmer by lowering expenses of water heating for the

crocodiles.

How it’s Processed

Hide

The value of the saltwater crocodile skin is currently ranked number one as compared

to all other crocodilian hides in world markets. The process after the harvest for their

leather would consist of multiple variations, depending on the manufacturer that

purchased the hide or other. The care of the raw skin is the most important part of

crocodilian care. The belly, being the most desirable part, is usually cured with salt to

preserve the hide before tanning. (See Figure 2) Top grade skins are usually purchased

in the markets of tanneries located in fashion districts of the world, such as France.

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These purchased hides are then dyed with

coloured pigment and processed further to

increase the value of the hide. One example

of a process would be a purse, such as a

Birkin bag, the company that buys the

leather would treat, colour and shape the

leather into their desired product, which

would increase the base material value exponentially in its finished good form.

(MacGregor, J.,2006).

Meat and by-products

Meat is classified as a secondary product of the crocodile, and leftover meat is often

used to feed other crocodiles within captivity. Commercially, however, the meat can be

sold to local restaurants, grocers or butcheries, ranging from fresh, frozen or seasoned

varieties of meat. Crocodile meat is white and the texture can be compared to the

texture of chicken meat. For meat, the highest valued part is the tail, with the rest of the

body meat falling second. Other crocodile items such as heads, feet, teeth, claws and

oils can also be processed and sold by demand.

Cost of Inputs and Labour

Feed

Crocodiles are carnivores and have diets allowing for a variety of types of meat.

Preference of feed depends on the farm, however, the diets of crocodiles vary with the

size of the animal. Hatchlings mainly feed on smaller species such as shrimp, insects or

larger species cut into smaller pieces,(Webb and Manolis 1989). As the crocodile

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continues to grow in size, their diet is more likely to contain fish and the meat of other

mammals. The fish fills the nutrient gaps left by red meat or poultry, allowing the

crocodiles to have stronger immune systems, (Magdalene Francis, Patrick C. H. Morel,

Brian H. P. Wilkinson, Timothy J. Wester, 2017). While we can assume that the average

cost of feed is around $0.73 per lbs, the most profitable source of feed is the use of

rendered meat and waste meat from meat processing facilities or local farms, which can

cut costs.

Healthcare

Healthcare for this species is far less important compared to the standard of health care

put towards average livestock farming. Saltwater crocodiles are known to have a very

small amount of health issues, due to their sturdy structures and ability to fight disease.

However, their main health risks are skin diseases, which could be serious if the

individual's main source of income is from the hide, (Buenviaje, 2000).

Labour

The costs associated with labour within the crocodile industry would be similar to most

other livestock farming labour costs. While the specifics of the jobs may vary, the overall

careers and salaries provided by the crocodile farms would be very similar to a native

species farm. A fixed cost would be labour and would vary on how large the farm was,

and the general health of the crocodiles with the need for veterinarians or extra help.

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Overall

The flowchart on the right shows

the overall evaluation of costs on a

typical farm. The main costs that

would come from crocodile farming

are largely similar to the ones from

an average livestock farm. The

main variations would be the cost

of feed, heating and the extra

costs of permits required to farm generally termed non-domestic animals.

Niche Market

The market of crocodile farming is considered a niche market because of the small size

of the entire industry. With the industry being so small, the production within is generally

specialized and consists of specific tasks, such as the grading of leather or the luxury

products made within the industry.

Benefits

Benefits to Canada

The use of these farms would also benefit the Canadian livestock industry, allowing for

pressures of decreasing demand for meat to level out, due to the need of meat to feed

the new species within the industry, (Thorbjarnarson, J., 1999). Within economics, the

number one way to expand your production possibility frontier (PPF) is to introduce a

new technique or technology into the market. With the introduction of a new type of

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livestock farm, the entire frontier would shift to the right, which would allow meat

producers to produce more with a smaller opportunity cost. Consumers would also

benefit from the entry of a new meat on the market, as with the decreasing opportunity

costs the market price for meat would decrease with it. Also, with the introduction of a

new agricultural practice into the Canadian agriculture sector, the economy be booming

with new employment opportunities from new farms, factories, and stores,

(Thorbjarnarson, J.,1999). This boom in new jobs and careers would provide a variety of

different options for the unemployed, with the ability to work on a farm, in a factory or

even to get a veterinary license with a specialization in the new species, which means

more generations could be influenced to go to school to get a degree, heightening the

success and education levels of the entire country.

Environmental Benefits

The environmental main benefit of this new practice is very clear and direct. With the

use of captive breeding in Canada, the overall populations of crocodiles globally would

be able to rise steadily and the constant fluctuation of the current population levels

would be able to become easy to predict. Also, with the use of waste meat in the

production of crocodiles, the amount of waste and overall unsustainability in the meat

industry would decrease. This would allow for farmers to decrease waste costs and

waste itself, which is a benefit for both the native species farmer and crocodile farmer.

Sustainability

The sustainability of crocodile farming in Canada is almost certain, due to the fact that

the input costs are sustainable and the ability to access multiple markets in multiple

countries. Having access to the production of multiple products in the agricultural sector

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is extremely beneficial because when the demand for one product decreases, the

farmer could put more attention and invest more into a product that has a stable

demand. For example, if a farmer’s main source of income is from crocodile meat and

demand is decreasing, the farmer can invest labour efforts and feed costs into the

animals that are more likely to provide a profit on the skin market. Also, with the overall

demand for crocodile products being globally spread, a farmer has the sustainability of

always having an open market to trade with, allowing for revenue from exports to stay at

a steady rate.

Economic Breakdown

Transportation Logistics

Generally, the method of transportation within the industry depends on the age and size

of the crocodiles being transported. The main concerns of transportation is dehydration,

temperature problems and the comfort of the animal. The animals should be enclosed in

a well-ventilated padding container to decrease the possible self-inflicted and transport

damage for long-term transport. Prior to long-term journeys, crocodiles should not be fed

for at least three days before the trip. Typically a board with straps is used to restrain the

crocodile within a vehicle for a short-term transport. Also, for the best outcomes,

Crocodiles should regularly be doused with water during the journey.

Cost Analysis

Beginning this type of operation includes a high demand for capital, as the species is

not native to Canadian borders, making the resources needed to begin imports or rare

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in Canadian markets. On the contrary, the economic payout from this type of farming, if

successful, is much larger than the costs required to commence, (Thorbjarnarson,

J.,1999). The main source of revenue is from harvesting, with the hide being the most

valuable part, and other by-products following after. The sale of crocodile skin is

generally given credit for driving the industry, (Joanen et al. 1997; Woodward 1997). In

an economic analysis, estimated revenue was at a price of $4-5 per pound, which

indicated that income from meat sales is majorly higher than processing expenses. The

processing costs for crocodile skin were higher at $10-15 per average crocodile. Feed

costs, representing 42% of operating costs, are the largest component of operating

expenses (Brannan, Roberts, and Keithly 1991), however, that cost can be reduced with

the use of waste meat from slaughter-houses (beef, chicken, pork), and fish, (Dodson

and Degner 1984). In some cases, a crocodile producer can get the meat-free, for

example, A dead chicken from a poultry farmer who otherwise would have to pay to

dispose of the waste, (Dodson and Degner 1984).

International Factors

Competition

The demand for crocodile skin shows no indications of decreasing, as expanding

human populations brings a growing interest in the potential of a new way to feed the

globe. When asked which countries posed the biggest competitive edge in the export

market, the main answers were Nile crocodile farming in Africa, alligator farming in the

USA, and saltwater farming in Asia.

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Trade

The trading of crocodilian products is heavily controlled, and sustainable while providing

an incentive for the preservation of crocodiles and their habitats. Trade with the US is

becoming less secure,and this type of product would allow the Canadian market to

make a larger entrance into the European market, as the EU is the main client in

crocodile goods. However, while free trade with the US lasts, the market for crocodile

skin is also large which would allow a steady trade from the beginning and throughout

the process of investing in the European market. Skin prices for crocodiles have been

on the rise, and constant adjustments of tariffs and world market crocodile product

prices will continue to happen in upcoming years.

Pull of Tourism

The touristic attraction of

farming has a large hope for

the countries where crocodiles

are not native. Though tourists

usually prefer to see

crocodiles in the wild, the attraction of a captivity full of foreign species is increasing,

and are often rated highly and are named popular destinations. The use of the tourism

domain of crocodile farming would give farmers an edge compared to other local

livestock farmers with native species, which would allow for extra income among all

stages of the crocodile’s lifespan.

Real World Factors

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Company Interference

Crocodile farming is a brand new style of agriculture within Canadian borders, which

means that the companies that will be competing for a spot in the market will be slim to

none. However, if the farmer wishes to have a put in the door of the meat industry, they

will need to keep in mind the thoughts and demands of the consumers. If the farmer

wants to compete in the meat industry, it would be ideal to look out for or even attempt

to create a working relationship with companies like Maple Leaf, Lilydale Foods, Maple

Lodge Farms and Sunrise Poultry.

Creative Marketing Strategy

There are many ways to advertise this new type of agriculture in Canada, as you could

market each type of product to a different group of buyers. Beginning with the marketing

of the production of crocodile skin, one creative idea would be to introduce the

popularity of the luxury crocodilian goods within Canadian markets. With the leather

being the major good that comes from the harvesting of crocodiles, it would be a

beneficial idea to promote the popularity of crocodile skin in the fashion trends of

Canadian styles. A specific idea to promote the use of crocodile fashion products would

be to interest the major companies or designers located within Canada, such as Roots,

or Canada Goose, or even someone like Greta Constantine. Along with the increase in

interest of leather, the interest in crocodile meat could also be beneficial. One strategy

to increase the use of crocodile meat in Canadian dishes or in the Canadian meat

industry would be to partner with companies such as Maple Leaf, who already have a

strong client base and a well-seen profile in the meat industry. Farmers could sell their

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meat to Maple Leaf and allow them to put their name on the product, which would allow

for the new type of meat to reach more consumers, and would allow them to feel safer

trying a new meat product because of the already established trust. The marketing of

other by-products produced from crocodile farming such as oils could also be

successful. The suggested benefits of the oil include skin softening, the reduction of

redness and dryness, nourishing for hair and its ability to assist in the healing of wounds

are all health benefits that could be marketed. For example, crocodile oil is

recommended by companies like Marie Claire, a popular beauty blog, and further

recommendations from other sources such as People Magazine or Women’s Health

Weekly would allow the popularity of the oil to thrive. Overall, with the promotion of all of

the aspects provided by crocodile products, the normality of the use of them would

increase, which would increase the overall demand and need for crocodile farming

exponentially.

Future Studies Needed

Going forward a lot of new research would need to be provided for further education

within the farming of crocodiles. The amount of research and real-world examples

globally are not near enough to provide a factual and quantitative prediction to the

outcome of introducing this industry into Canada. Hypothetically, the use of this new

agricultural practice seems great and would allow Canadian markets to add a unique

touch, on paper, however, the certainty of the success of the practice is blurry and

unreliable. While conducting the research for this paper, the main struggle was the lack

of quantifying numbers and examples to compare and contrast the success of this

industry in multiple locations. Most information that was found while diving deeper into

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this topic was from sources that did not provide physical numbers, such as research

done in Africa, where the ability to obtain accurate numbers is unlikely, and or was from

sources that were untrustworthy, and lacked academic depth such as news outlets or

farming blogs.

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