Russian exporters of cod fillets struggling with world financial crisis

November 5, 2008 16:48

Murmansk fishermen have run into major problems with exporting high-value fish products such as cod fillets and other bottomfish fillets, reports ( with reference to the industry sources.

According to the exporters, foreign traders are suffering from a lack of funds in order to pay for shiploads of the seafood. While earlier buyers were normally credited by Icelandic banks which offered very easy terms, now it is quite a challenge to borrow money from these troubled establishments. In this connection buyers have been compelled for payment by instalments with an open date of final payment, which cannot satisfy Murmansk fishermen who are putting money together for the coming auction for sale of 10-year capelin quota shares on 12 December 2008.

Murmansk fishermen produce onboard interleaved fillets in standard europack, namely in 20.43-kilo boxes of three 6.81-kilo blocks.

The United Kingdom has been a traditional market for such products before the crisis, the country being the world's further distributor of these Russian products in its turn. Along with the UK players, Norwegian traders have taken part in the process as well. However, a considerable drop of NOK exchange rate to USD has practically pushed them away from the market, because all payments for fish fillets have historically been made in USD. The same problem is now occurred on the UK market as well. The English pound has depreciated to USD from 1:2 to 1:1.5.

Earlier skinned cod fillets would cost from 8 to 10 USD per kilo. Now the price does not exsist as such as traders will not send any bids at all because the market is "dead" at present. All the market participants are playing a waiting game with traders ceasing purchasing and fishermen suspending sales.

Headed cod

In the meantime, there have been no problems with sales of headed cod. At the same time, there is a problem with the sales of summer haddock due to weak texture of flesh.

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