Grin and Barents: Russian Aquaculture looks to lucrative times ahead
Russia’s largest salmon producer, Russian Aquaculture, has announced plans for a massive expansion of its business by 2025.
As part of these plans, the company aims to increase production to at least 30,000 tonnes of salmon over the next seven years – compared to about 6,000 tonnes in 2017 – to become one of the world’s top salmon producers.
Russian Aquaculture aims to increase its salmon production in the Barents Sea to at least 30,000 tonnes a year
Just a few years ago, the company was experiencing serious problems: it suffered from losses, caused by fish diseases and the financial crisis in Russia, along with counter-sanctions, imposed by the country’s president, Vladimir Putin, in response to sanctions from nations including the United States.
However, the situation has improved since 2016, when Russian Aquaculture recorded its first profit of RUB 3.9 billion (US$60 million) in three years. Although much remains to be done in order to hit the company’s 2025 target, according to CEO Ilya Sosnov the first priority in implementing these ambitious plans is the establishment of vertically integrated production process.
Some work in this direction has already been done. Last year Russian Aquaculture completed the acquisition of the Norwegian producer Villa Smolt and received a licence to produce up to 5 million smolt a year.
In addition, the company plans to build its own production facilities, which will have the capacity to produce up to 3 million fish a year, a project that will require investments to the tune of US$30 million. These two enterprises will provide the company’s fish farms near Murmansk – where most of its production is concentrated – with more than half of their smolt.
Moreover, at the beginning of the current year, Russian Aquaculture won a bid to operate a further five farming sites in the Barents Sea.
The company now has the rights to operate 14 sites around Murmansk with a total capacity of 23,000 tonnes of fish per year. However, as part of their plans they aim to increase this number tally to 16. This will help boost production to 34,000 tonnes per year (the current biomass of fish in Russian Aquaculture’s Murmansk sites is 1,670 tonnes). According to estimates from Alexander Savelyev, head of the department of information at the Russian Federal Agency of Fisheries (Rosrybolovstvo), stocking up to 81.5 hectares of new sites will give the company the opportunity to increase biomass of fish in these waters by 5,000 tonnes.
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