Russian fish producers invest and expand

Russian fish producers invest and expand New Norebo and ATF processing factories in Murmansk and Arkhangelsk will focus on cod and other groundfish species supplied by their own vessels

Leading Russian fish producers are continuing to invest heavily in the expansion of domestic production capacities, which is part of state plans for the increase of production of high-value added fish products in Russia, reports Eugene Gerden.

Prior to 2015, the majority of fish produced in Russia, was exported, primarily to Asia Pacific states. That was mainly due to the lack of modern fish processing capacities within Russia itself. As a rule, Russian fish was then re-exported back to Russia in the form of fish products, manufactured in China and Japan with the price tripled during its journey back to Russia.

In recent years the situation has changed, as the Russian government has decided to provide quotas on fish production in its territorial waters, conditional on the construction of new processing capacities. This has prompted producers to invest heavily in the building of processing factories.

For example, Karat, Russia’s largest fish quota holder, has announced its plans to build a factory, that will specialise in processing cod and haddock in the Russian Murmansk region during the next several months. The level of this investment is estimated at 2 billion rubles (US$40 million). It will be implemented by Norebo, a subsidiary of Karat.

The capacity of the production unit is estimated at 50 tonnes per day, focusing on producing of fillets, salted and dried fish. Raw materials for the new plant will be provided by the company’s own vessels. Finished products will be supplied both to the domestic market and the EU states.

At present the company fleet consists of 43 medium- and large-tonnage vessels, while its total catch last year amounted to 530,000 tonnes. According to Forbes Russia, Norebo Holding is the largest holder of Russian fishing, with a reported total for 2017 of 437.800 tons, of which cod and haddock account for 119,000 tonnes.

In addition to Norebo, another Russian leading fish producer, the Arkhangelsk Trawl Fleet (ATF), has announced plans to build a fish processing factory in the Arkhangelsk region with a 2 billion ruble investment. The new factory will be equipped for full processing and is expected to have the same 50 tonnes per day capacity as the Norebo plant.

The factory will be established at the company's production site in the Arkhangelsk fishing port, next to the company’s existing plant, which produces preserves, salted fish, cold and hot smoked fish, according to ATF General Director Alexei Zaplatin, who added that processing fish in a shore-based factory is more cost-effective than onboard processing.

"We want to produce products, the added value of which is created on the shore. Thanks to lower costs, fish fillets, produced on the shore, will be cheaper those on-board produced. The cost of the project will be the same as in the case of Norebo -  2 billion rubles, and the payback period is three to five years,” Alexei Zaplatin said.

In the meantime, the decision of Russian leading fish producers and the local government to speed the development of fish processing in Russia conflicts with the plans of Chinese companies to strengthen their presence on the Russian seafood market, and may result in the loss of their access to low-cost fish resources.

Chinese state corporation China Merchants Group had already begun talks with Primorsky Territory governor Vladimir Miklushevsky regarding with the possibility of the establishment of a large industrial area in the southern Primorye, envisaged as a hub for exports of Russian fish to China. The majority of funding for the project is expected to be provided by China Merchants Group, while its total cost is estimated at about US$250 million.

The same China Merchants Group plans to accelerate talks with the authorities of the Primorsky Krai for the establishment a large transport and logistics hub in the Russian seaport of Zarubino, a port on the Posyet Bay. The Chinese investments would facilitate increasing its capacity to 60 million tonnes per year, with the potential to make it one of the largest ports in north Asia.

A railway link from the port already connects to railway lines running north to Vladivostok, west to Jilin Province in China and south to Rajin in North Korea via Khasan,. It is planned that the majority of cargo to be handled by the seaport after its expansion would consist of Russian seafood.

In addition to sea transport, the China Railway International Group plans to allocate funds for the development of railways infrastructure, to connect the Chinese and Russian seaports.

According to the Chinese plans, the expansion and development of infrastructure will help to significantly increase exports of Russian fish to the Chinese city of Hunchun, where dozens of fish processing plants already use Russian raw materials, located only 70 kilometers from the port of Zarubino. According to the Chinese authorities’ previously announced plans, Hunchun is slated to become one of the most important fish processing bases in North-East Asia over the next few years.

LATEST PRESS RELEASES

Wet weather gear for fishing – three things to consider before buying

Good quality wet weather gear is a must-have for any fishing professional. But finding the best gea... Read more

Introducing the 662 heavy duty wet weather gear flotation bib and pants from Stormline

Good quality wet weather gear is essential when your job involves exposure to the elements, but if y... Read more

Offshore Mariculture Asia highlights the need for sustainable growth

Future generations will need to produce more with less. Read more

Offshore Mariculture Asia 2018 programme announced

Actions for investment and financing opportunities together with the day to day practicalities of ru... Read more

Winners of the 2018 Icelandic Fisheries Bursary Awards announced

Lilja Alfreðsdóttir, the Minister of Education, Science and Culture in Iceland announced the winners... Read more

Mercator Media upgrades magazines and conferences brands

February 2018 Fareham UK - Mercator Media Ltd, the international, market-leading B2B marine media bu... Read more

View all