The U.S. Department of Agriculture will buy up to $5 million worth of domestic farm-raised catfish for school lunches and other programs in an agreement producers say could give the industry more leverage in its fight against Asian imports.

The deal comes amid escalating costs for catfish feed and the lingering battle with exports from Vietnam and China, which are gobbling away at the domestic market. About 95 percent of the nation’s catfish is produced on farms in Mississippi, Arkansas, Louisiana, and Alabama, and growers in all those states say they are suffering financially.

U.S. catfish growers had sales of $445 million in 2007, down 8 percent from the previous year, according to USDA statistics. The farming acreage also dropped by 6 percent.

Mitt Walker, the director for Alabama Catfish Producers, a division of Alabama Farmers Federation, says the deal for the federal government to immediately start buying catfish is significant. Roger Barlow, vice president of Catfish Farmers of America, says it could help by leading to even more federal purchases.

“We need all of the market opportunities that we can get,” said Barlow, who is also director of the Catfish Institute, which markets and promotes the industry. “We feel like our catfish can find its way not only into school programs, but also into military contracts as well. Our main concern is that our farmers have to make a profit.”

Making a profit hasn’t been easy.

There were more than 110,000 acres of Mississippi catfish ponds in 2002. That has fallen to 87,300 acres. Despite an increase in the average price processors paid farmers for catfish over the past six years, production costs can run much more.

Catfish feed has nearly doubled in price since last year.

Vietnamese basa and tra fish were the largest foreign threats six years ago before the Department of Commerce imposed tariffs. Now it’s Chinese catfish that’s the main concern for the domestic industry.

“We still have got a lot of work to do in terms of continuing to compete with imported fish, whether it be basa from Vietnam or catfish from China,” Walker said. “We are going to continue to try to make the public aware that there are differences in these products.”

Barlow said 52 shipments of imported Chinese catfish were blocked from coming into the country because they contained chemicals and other ingredients banned in the U.S.

“First and foremost is the health and safety concerns in consuming those products that are not regulated, that are not inspected, that contain dangerous and illegal chemicals,” Barlow said.

In contrast, U.S. farm-raised catfish are one of the most highly regulated commodities in the country, he said.