Prices of salmon caviar souring on hungry Russian market

In the recent weeks preceding early March 2007 salmon caviar has been dramatically appreciating on the Russian market. As compared to March 2006, wholesale prices increased more than by one third. Caviar producers attribute the price rise to insufficient supply and growing demand. Retail chains are going to increase their prices on the heels of wholesalers, according to Vedomosti.

In 2006 expectations of caviar producers as to catches did not come true. Already by mid-autumn 2006 main players started to buy up all caviar available on the market and prices climbed up: by November the raw material appreciated by 7-10% as compared to July.

In December 2006 traditional end-of-the-year demand pushed prices up by another 5-7%. During the New Year holidays small and medium-size players sold off their inventories and in January 2007 as compared to July 2006 wholesale prices appeared to be 30-35% higher than in July 2006. In February 2007 one kilo of salmon caviar in wholesale lots was priced RUR1100-1200, while in July 2006 buyers could choose between several grades of salmon caviar all priced at RUR750.00.

Prices in March 2007 were 40% higher than in March 2006. Prices kept on rising and as per early March the price rise on the summer level amounted to 40-45% already. In order to avoid shortage on the market, wholesalers increased their prices until the next fishing season which peaks in July-August. The retail margins for salmon caviar fluctuate between 5-60% depending on the shop format.

The retailers have been already affected by the price rise. Moscow-based retailers have been facing a 25-30% rise of wholesale prices of salmon caviar as compared to last year. Due to poor fishery, wholesale prices of chilled salmon caviar rose by 20%. Billa and Grossmart chains kept on trading at old prices, but they said they could have to raise prices if the market situation developed in the same way.

Salmon caviar is a highly popular product, but the price rise as great as 30% can affect the consumer demand. However, some market players think that the demand will hardly decrease: normally the demand for salmon caviar peaks during the New Year holidays and Pancake week (a national holiday before the Lent), but this year by the end of January suppliers reported five-fold rise of salmon caviar sales as compared to last year.

NP Consulting

According to NP Consulting Company quoted by Vedomosti, the Russian market of packed salmon caviar is estimated at 6000-8000 tonnes per year depending on catches. Another 2000-3000 tonnes of caviar are marketed in bulk form (non-packed). The black market of illegally processed salmon caviar is estimated at 3000-6000 tonnes, according to different sources. (All the above figures refer to the period of 2001-2006). The largest producers of salmon caviar are OOO SSS (ltd) from Yuzhno-Sakhalinsk, OOO Kompania Tunaycha (ltd) from Sakhalin, OOO Severnaya Kompania (ltd) from Moscow, OOO Svobodnoye-2001 (ltd) from Sakhalin, OOO Russky Rybnyi Mir (ltd) from Moscow province, JSC ZAO Gidrostroy from South Kuriles, OOO Korsakovsky Konsevnyi Zavod (ltd) from Sakhalin, ROK-1 from Saint Petersburg.