Extending the market for sprat and Baltic herring

by Thomas Jensen

Mauno Leppik, Managing Director, Estonian Trawling Association

The Estonian Trawling Association (ETA) is one of Estonia’s three producer organisations. Its factory, which processes sprat and Baltic herring, went on stream at the end of August 2010. Now, the organisation is looking to increase its capacity, enlarge its use of automation, and extend a quay that will improve the offloading of catches.

ETA is based at Paldiski, not far from Tallinn, on the site of a former Soviet submarine base and naval training facility, which is now an industrial estate and port. It has five members who fish with small trawlers and represent about 8,000 tonnes of the national quota for Baltic herring and sprat.

Looking to increase capacity

Currently, average in-season production is approximately 10,000 metric tonnes, which has remained stable over the past three or four years. Freezing capacity is 180 tonnes per 24 hours for a single species and 140 metric tonnes for assorted species. Storage capacity is 2,500 metric tonnes for assorted products and 3,000 tonnes for a single product. A new factory is planned that will increase capacity, which will in turn increase the need for more fish. After the planned expansion, freezing capacity will increase to more than 200 tonnes. Currently, the catches are unloaded two kilometres from the factory, requiring them to be moved by truck. If permission to extend the quay is granted, it will be possible to pump the fish directly from the boats.

Block frozen Baltic sprat and herring for the Eastern European market are the organisation’s main products. Other products include spicy marinated and salted fish, and individually frozen headed-and-gutted herring, which has proven popular in Ukraine. ETA produces dried products as well, including smelt, roach, and pike. The fish are salted for four to five days and then dried in special ovens, so they contain nothing but salt. Salted sprat, a typical product for the Romanian market, has a salt content of 27%. It is eaten as a snack and is especially popular in autumn as an accompaniment to the young Romanian wines, which are drunk with the salted fish. The shelf life of spiced products is three months. For salted products, it is six months, owing to the high salt content.

The importance of knowing your markets

Nearly all (99%) of the organisation’s production is exported. Main markets include Ukraine, Kazakhstan, and Russia. Small but growing markets include Latvia, Lithuania, Israel, the Balkan countries, with minor sales to Finland. The remainder is sold to Estonian producers. Ukraine buys both spicy sprat and frozen blocks for production. Because of the two- to three-week delivery time by railroad, Kazakhstan buys only frozen products. At least 95% of sales to Romania is salted sprat. Before the ban on the import of fresh products, the company used to sell large quantities of frozen blocks to Russian canneries, but currently they sell only ready-to-eat products, mostly spicy sprat. Russia is part of a Customs Union, which includes Belorussia and Kazakhstan. Ukraine is not part of the Customs Union. ETA’s customers are almost exclusively wholesale distributors, although in Ukraine, they sell directly to retail markets, who buy bulk-packed sprat and sell it in stores by weight.

Krapesk is a well-known brand in Russia, Ukraine, and Kazakhstan. ETA retained the brand name and logo, which belonged originally to one of the organisation’s founding members, because of its recognition value, based on a well-established reputation in key Russian, Ukrainian, and Kazakh markets. The expansion of the facilities will increase the need for fish. PO members are not obliged to sell their fish to the organisation, although most do. ETA will have to go further afield to satisfy the demand and purchase raw material from sources outside the organisation. For example, in May they buy coastal sprat, which are not caught using trawl nets but special nets used by coastline fishermen, who are not members of the PO. Surplus fish are sold to other producers.

A well-established workflow

The fish, mostly a mix of herring and sprat, are graded mechanically into four categories, while separating the two species, sprat typically being smaller than herring. The graded fish are sent for specialty processing or pumped into the freezing equipment, where they are shock-frozen for approximately two hours into 15 kg blocks, with an internal temperature of minus 18 °C. Each freezer can handle one tonne of raw material at a time. The frozen blocks are conveyed mechanically to the packaging line where they are either loaded directly on pallets or are wrapped in special packaging material, with polypropylene on the inside and paper on the outside. The bulk of the production, ca. 70%, is frozen blocks. After the fish is packed, it is labelled with date and product name. Shelf life is added later. Palletising, weighing, and transport to storage is mechanised. Data is collected to allow traceability to assure freshness.

The fish is pumped from the vessel and then loaded into bins, which are filled continuously and placed in refrigerated tucks.

Dedicating quotas to high-quality catches

Depending on the water temperature, the production season can run from September/October until April/May. The organisation reserves its quota for the period of autumn/winter/spring because, in summer, fish feed on a diet of plankton, giving them a much softer texture, which causes their stomachs to break easily. Further, the diet causes the flesh to taste bitter. In autumn, they stop feeding in the cold water. Fish caught in January have less fat and a firm texture, leading to longer shelf life. Because sprat and herring are fatty fish, they must be handled and produced quickly.

Some Finnish companies use fish caught in summer for fishmeal, where a soft texture is not important, but ETA reserves its quota for high-quality fish for human consumption. According to Mauno Leppik, ETA managing director, the facility runs around the clock during high season. He says, “When the fish are coming in, we work. Even on Christmas Eve, people are working, because we need to produce when the fish are coming in. During the three-to-four month downtime, we mainly do repair and renovation”.

Because they would like to put more effort into high-volume products, including frozen and marinated fish, the company plans to reduce the amount of manual labour and increase the amount of automation by investing in machinery, in particular to speed the freezing process, standardise the mixing of spices, and increase the efficiency of filling the buckets. The heading and gutting process is now automated. The production is currently limited, but it has great potential in the Ukrainian market. Meeting the demand for ready-to-eat products is one of the main reasons behind the investment. Machinery will be added to pack smaller buckets, for example 800 g, which they did
previously but discontinued because the production was too labour intensive. Automation will allow the company to better utilise the space and avoid using 25–30% of the space for manual work, which involves many people working on low-turnover products.

Seeking certification in the future

In the future, the organisation will probably seek certification of its stocks’ sustainability by the Marine Stewardship Council (MSC) or a similar body. Outside certifications are less important to the organisation now because its main markets do not require them. It is anticipated that the number of Estonian national controls now in place will simplify future certification.

Mauno Leppik strongly believes that attending exhibitions is one of the best ways to market and sell products. He says, “You can see what others are doing and get an idea of the products that are being developed. And it’s a good place to meet existing and potential customers”. Last year, he attended shows in Kazakhstan and France, and this year, he has already attended the show in Moscow. Later this year, he will go to Uzbekistan and Brussels. Members of the producers’ organisations often collaborate on a stand and attend the shows together reducing the costs. The fishing sector in Estonia is now well represented on the international stage. And Brussels is big. If you are not in Brussels, you’re not in the fish business”.

William Anthony

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