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Larry Drazba

 

On Saturday, May 5, 2001, I interviewed Larry Drazba, general manager of  700-hectare, semi-intensive shrimp farm and processing plant in  Nicaragua.

 

Shrimp News: Tell me a little about your educational background and your first steps into aquaculture and shrimp farming.

 

Larry Drazba: In 1976, I graduated from Loyola University in Los Angeles, California, USA, with a major in biology, a minor in chemistry and an eye on marine biology.  My first job?  A research assistant at Tap Pryor’s System Culture Corporation in Hawaii, where I grew algae for oyster larvae.  Greg Emberson, currently a shrimp farming consultant, managed the oyster farm.  I was there for two years, from 1976 to 1978.  In the spring of 1978, I decided to return to the mainland and go back to school.  In the winter of 1978, I began working on a master’s degree at the University of California/Davis.  At the time, Serge Doroshov, Wally Clark, Fred Conte and Graham Gall were involved with the aquaculture program at UC Davis.  It was an exciting time because sturgeon farming was just getting started in California.

 

I did my master’s thesis under Graham Gall, a geneticist, who was raising mosquito fish to control mosquitos in California’s rice fields.  We grew them in stacked trays in a heated environment and seeded them from planes.  I was at Davis for about a year-and-a-half and that’s where I met my wife Monica.

 

I graduated in 1980, with a master’s degree in International Agriculture Development (although my thesis was in culturing mosquito fish).  Most of my course work was in agriculture, economics, sociology and technology transfer to third world countries.  I was determined to go overseas.  A classmate at Davis offered me a partnership with his family in a prawn farm (Macrobrachium rosenbergii) in Mexico.  In June 1980, Monica and I gathered up our limited possessions and moved to Mexico—and we have been living out of the country for 21 years now.

 

At the time, not many people were working with prawns in Mexico.  Durwood Dugger, currently a shrimp farming consultant, was doing something in northeast Mexico; Miguel Avila Tamayo was down in Colima; Jamie Dominguez was in Acapulco; and there was one other group on the Gulf Coast.  At the time, marine shrimp farming was reserved for cooperatives, so freshwater prawn farming appeared to be a good alternative for the private sector.  We set up shop in Barra de Navidad, Jalisco.  I had two projects, one in Tecomán, Colima, and one in Chihuatlán, Jalisco.  We were there for 3 1/2 years, from 1980 to mid-1983.  It was the end of the oil boom in Mexico and we experienced the first devaluation in 1981.  We were doomed, but did not know it at that point.  A lost decade loomed in our future.

 

After a couple of years, we came to the realization that prawns were just not doing very well in Mexico.  The animals did not grow as fast as they did in other places.  We didn’t know why, but the productivity was not good.  We concluded that prawn farming was not going to be a good business on the Pacific Coast of Mexico.  In 1983, we got out of that business.  The prawn hatchery worked; the problem was growout.  We just could not grow enough animals fast enough to make a profit.

 

Then a gentleman from the Gulf Coast of Mexico offered an opportunity to try prawn farming in the state of Vera Cruz.  So we moved there in mid-to-late-1983 and started an operation with a family out of Mexico City.  We had two small growout operations in Vera Cruz, where conditions for prawn farming were supposed to be much better than those on the Pacific Coast.  But the conditions were about the same, and then we ran into an unforeseen problem.  It can get real cold on the Gulf Coast of Mexico because there is nothing between Canada and Mexico but barbed wire.  Those winter cold fronts that dip into the United States from Canada frequently continue right down the Gulf Coast to Mexico.  It can get very cold in the winter, prawns don’t like that, and they don’t grow well.  We ran the hatchery in the winter, head-started the larvae in nurseries in the spring, and hoped to get a good crop over the summer and early fall, before the cold fronts hit in late October.

 

We lived in a peso economy.  Prawn farming was still experimental and the projects were very small, we had to make them commercial or lose them because there was no financial support.  I did some consulting to survive, worked for the Agricultural Development arm of the Mexican National Bank and trained bank officials in appraising aquaculture loans.  It was a lot of traveling from project to project, I learned a lot about aquaculture and project management as well as the Latin culture and Spanish language, but economically we were going no where and the projects folded.

 

For the first half of the 1980s, one industry after another collapsed in Mexico.  Things kept getting worse and worse.  Then, in 1985, just as things started to get better under the De la Madrid Administration, a huge earthquake crumpled Mexico City.  Any money that was available was sucked into Mexico City, not for the rebuild, just for the clean up.  It was a real mess, devastating, and with that the country slipped again.  So in early 1986, we decided that it was time to move on.

 

I mailed my resume to people who might be interested in my talents.  I received the strongest response from Blair Smith at Delarvas, S.A., in Ecuador, and took a job working at his spawning station in Esmeraldas for a short time.

 

My real experience in Ecuador started after leaving Delarvas.  For the next five years, I worked with Robert Moss on two projects: Megalarvas, S.A., a shrimp hatchery in Manabi Province, and El Portillo, S.A., a shrimp farm in Guayas Province.  Although I had experience with freshwater prawn, oyster and fish hatcheries, this was my first work with shrimp.  Yasu Akamine was my mentor.  We started the hatchery first, right at the beginning of the 1986-1987 El Niño.  With wild seed cheap and abundant, the hatchery struggled for two years.  In 1988, we started the shrimp farm to take advantage of the boom in Ecuadorian shrimp farming and to give the hatchery a market for its seed.  I had three years on that farm, the first was very slow, coinciding with the La Niña of 1988.  The next two years were excellent.

 

By this time, Monica and I had been out of the country for ten years.  We were very content living overseas, but for whatever reason, I did not feel at home in Ecuador.  I was offered an opportunity to join Ed Scura on a shrimp farming project in Guatemala, Fincas Aquaticas, S.A., and accepted.  I spent three years in Guatemala working on this project (and briefly for Pesca, S.A., a Guatemalan shrimp farm run by Ladex Corp.).  Fincas Aquaticas did not do well commercially.  The location was very difficult, the water quality seasonal—and production dropped dramatically during the dry season.

 

At the time, Robins McIntosh was running feed trials for Zeigler at the farm and also working for Fincas Aquaticas on the cause of the dry season problems.  Conversations with Robins about nutrition, water quality, and, especially, the microbial community in shrimp ponds, have had a great influence on my current shrimp farming strategy.

 

In 1995, Andy Kuljis (currently president of Aquatic Farms, a consulting company) of Amorient called with the offer of a job in México.  By this time, the Guatemalan project needed logistical management more than biological expertise, and Monica was very anxious to return to México.  We bundled up the four children and moved to Mazatlán, Sinaloa, to work for AquaNova, S.A.  It had been almost seven years since leaving México and the country was very different.  We did not like living in Mazatlán, a tourist town, because we were used to living in rural areas with more native charm.

 

The AquaNova project was very interesting.  It gave me the opportunity to participate in the start up of the SPR 43 (specific pathogen resistant) Penaeus stylirostrus program in México.  France Aquaculture (a consulting company with links to the French Government, but no longer in business) sold AquaNova a complete technology package for farming IHHN resistant stylirostrus in Mexico.  It was the first time I had seen a packaged deal for shrimp farming technology and thought it was a good approach.

 

The production potential was incredible at AquaNova because the stylies were very fast growing and production technologies developed by the French combined with the good water quality in México yielded excellent results, but it would be very difficult for AquaNova to meet its ambitious development plan under the existing political system in México.  I left before the commercial project really got under way.

 

In late 1995, I receive a phone call from Jeffrey Graham (Enaca/Ecuador) about a shrimp farming opportunity in Nicaragua.  Jeffrey was involved in a project there and needed a project manager.  I took the job.

 

Shrimp News: Before you get into your experiences in Nicaragua, how about a brief history of shrimp farming in Nicaragua?

 

Larry Drazba: In Latin America, most shrimp farms are well-capitalized large-scale operations.  In Nicaragua, however, government sponsored cooperative farms are a major part of the industry and, in fact, launched it with the construction of the first ponds in the late 1980s.  But important development of the industry did not occur until 1993 when both privately owned companies and more cooperatives jumped into the business.  There was tremendous growth during 1994 and 1995 and farmed shrimp became a major export item, approximately $15 million, for the first time.  With a couple of good years behind it, the industry experienced another wave of investment in 1995.

 

Unfortunately, the next four years brought one catastrophe after another.  First Taura.  Then Mitch.  And then whitespot.

 

In 1998, we were recovering from the Taura virus, the industry was optimistic, farms were expanding—and then Hurricane Mitch happened.  The big private sector farms near the mouth of the estuary were not hit as hard as the cooperative farms in the upper part of the estuary, where water levels rose three meters and wiped out most of the farms and carried the crop out to sea.  With the local infrastructure destroyed and costs rising, the private sector struggled, but it recovered relatively quickly after Mitch.

 

Those that responded the quickest were Camarones del Pacifico (CAMPA, one of the biggest farms), Sahlman Seafood de Nicaragua, Nicaragua Camaronera, S.A. (which is Mario Callejas, a long-term shrimp farmer from Ecuador, who is Nicaraguan and back in the country operating a 500-hectare farm), and our company, Camanica, S.A.  Since the private sector farms came through Mitch in pretty good shape, they were heavily stocked in January 1999—when whitespot hit.  Pre-whitespot survivals were 35%; post-whitespot, 5% to 10%.  It looked like the end of the world for shrimp farming in Nicaragua.

 

Shrimp News: How did your company survive all of this?

 

Larry Drazba: After Mitch but before whitespot, we had a board meeting and looked at everything.  The banks restructured our financing, but would not put up any working capital.  We needed to recapitalize.  Our original partners refused to come up with any new money and abandoned the project.  In March 1999, I was asked to close the operation, but decided to keep it running to support our 150 to 160 permanent employees and up to 800 temporary employees in the processing plant.  I spent a year looking for a white knight to come in and help pick up the pieces.

 

During this time, I produced a little seed and processed a little product.  All income was put back into the farm.  Production started to go up a little.  We were basically living hand to mouth for 15 months.  A couple of times we came close to selling the farm, but the investors never came up with the money.

 

Then, in early 2000, when I didn’t have enough money to stock the ponds, I gave Jeffrey Graham, who was working for Eastern Fish Company (the Bloom Family) in the United States, a call.  Jeffrey was working on Eastern’s buyer diversification program, a program designed to reduce Eastern’s dependency on Ecuadorian farmed shrimp.  I asked Jeffrey if the Blooms would be interested in taking a position in Nicaraguan shrimp farming.  They were!  Two days later I had a check for operating expenses.  The farm was up and running again!  Without the Blooms, the company would have failed.  I am tremendously grateful for their support.

 

In August 2000, we managed to negotiate a deal with the bank to buy the assets, so now all the assets are in a company called Camarones de Nicaragua (Camanica, S.A.)—everything, the hatchery, the processing plant and the farms.  The Blooms got involved in Nicaragua as a carry over measure until another group came along who were more production oriented.  That group has not appeared yet and in the meantime together we have managed to get the operation back to 100%.

 

Information: Larry Drazba, Camanica, S.A., Km. 130 Carretera, Chinandega, León, Nicaragua (phone 505-341-1628, fax 505-341-3744, ldrazba@ibw.com.ni).

 

Source: Larry Drazba, Interviewed by Bob Rosenberry, Shrimp News International on May 5, 2001. Published on October 4, 2001.

 

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