Russia's fishery sector rated second in terms of share of profitable businesses

May 8, 2009 12:43

According to Russia's Statistics Centre (Rosstat for short from Russian), in 2009 the nation's fishery industry has become the second top sector (after retail and wholesale trade) in terms of share of profitable businesses, reports ( with reference to Vladivostok Daily News.

In Vladivostok-led Primorsky Krai Territory it has also taken the second place yielding only to transport and communication. At the same time, increased profit has exerted practically no influence on the fleet renewal.

The province's vice-governor Igor Uleisky says that in the year 2009 Primorye fishermen will get large scale state support. More specifically, under the federal target program "Increasing efficiency of exploitation and development of resource potential of fishery industry in 2009-2013" six investment projects will be financed with the total value of the projects exceeding 1.5 billion RUB. The money will be spend for fleet construction, development of port infrastructure, coldstore facilities, support of scientific activity, fishery policing and reproduction of aquatic bioresources.

The above mentioned one and a half billions RUB will become extra support to that already received by the fishermen from the state. In particular, as of 2009 the companies are enjoying 10-year capture quota shares, which give the fishermen big opportunities for longterm business planning. Besides, a serious step to meet the needs of the fishermen has been made in the sphere of taxation. Now the fishermen are allowed to switch to singe agricultural tax of 6% from the profit as well as to pay fees for exploitation of fish resources at soft rates of 15% subject to the share of profit from sales of catches and products made from them amounts to at least 70%. Experts claim that these innovations will help businesses save hundred millions of rubles.

The government has made it a point to raise the sector's competitiveness via development of value added processing. However, by present the target has remained unsolved with the companies engaged in value added fish processing still being very few and the total coldstorage capacities in the Russian Far East estimated at only 150,000 tonnes (several times lower than needed). At the same time, the financial condition of the fishermen has improved.

According Russia's Pollock Association, the nation's fishery industry is worth ca.6 billion USD. In its turn, according to Primorskstat, in 2008 the turnover of Primorye's fishery sector (capital Vladivostok) grew by 3% to 16.87 billion RUB with the total harvest of pollock in the Russian Far East in 2008 making approximately 1.3 million tonnes. The same volume is forecasted to be harvested in 2009. In the meantime, in January-February 2009 the balance sheet profit of Vladivostok fishermen amounted to 589.5 million RUB, 2.4 times up on the result in the same two months of 2008. The above figures shall be taken as official, says the Association.

As for non-official figures, it is claimed that some exporters have been misreporting export prices to the customs. For instance, on the world market the price is about 1600 USD per one tonne of headed pollock, while some Russian fishermen will often declare the price of 1200 USD per tonne at customs. On the average BATM large trawler harvests up to 2000 tonnes of pollock per trip. Thus, the savings on the customs value amounts to ca.800,000 USD per vessel.

According to the official statistics, in 2009 members of the Pollock Association have harvested and exported more than 160,000 tonnes of pollock in the subareas of the Sea of Okhotsk. The gross proceeds in terms of export prices therefore exceed 250 million USD.

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