Ukraine: Living on a powder keg

by Eurofish
Viktor Katrechko

Ukraine’s seafood business: Impacts of Russia’s war against Ukraine

Odessa Sturgeon Breeding Complex LLC is located in the city of Vylkove in the Danube Delta, 220 kilometers from Odessa, on the border with Romania. The company specialises in the production of sturgeons, cyprinids, and other freshwater fish and their juveniles, fertilised sturgeon roe, and black caviar. Eurofish spoke to Viktor Katrechko, the company’s CEO, and Julia Sumenkova, Chief technologist.

This is the seventh in a series of articles in Eurofish Magazine dedicated to seafood businesses in Ukraine and how they work and survive during the war.

In 2006, explains Ms Sumenkova, three enthusiasts acquired a former Soviet fish farming facility, which had been abandoned and its equipment removed, as well as 720 ha of the surrounding land. A lot had to be done: renovations included the repair of the pump station to secure the water supply, pond base refurbishment, and the preparation of dams to ensure the farm functioned properly.

Sturgeons in focus

The investors decided on sturgeons as the core species, and applied for a permit to catch wild fish in the Danube—such permits are given in exchange for an undertaking to restock the river with sturgeon juveniles. In this way, the company got its broodstock. Today, the farm grows Siberian (Acipenser baerii), Russian (Acipenser gueldenstaedtii), sterlet (Acipenser ruthenus), beluga (Huso huso), starry (Acipenser stellatus) sturgeons and their hybrids, as well as cyprinids, herbivores, and predator freshwater species native to the northern Black Sea and the Danube Delta.

The company is focused on the reproduction of genetically pure lines of sturgeon and other native species of fish living in the Danube Delta and the north-western edge of the Black Sea, including those which are on Ukraine’s Red List.

All the fish are grown in conditions as close to natural as possible in the Danube River  with a natural food supply. By raising offspring from pure lines of wild sturgeons, the company has achieved rapid growth rates and the fish show immunity to various diseases. Products from the fish are distinguished by a unique, natural taste, without any negative aftertaste.

Multiple uses for roe

To better control the growth of juvenile sturgeons, the owners decided to establish a hatchery with a recirculation unit to grow the fry. This unit was built in Karnaliivka village, 77 km from Odessa. Fertilised roe is brought here from Vylkove, hatched, and the fry sent back to Vylkove for grow-out to commercial size. The fish are sorted, and the strongest ones are selected for the broodstock.  Part of the roe extracted from these fish is processed into caviar for human consumption, and another part is used for fertilised roe production, which amounts to 100 kilos a year: half of it is used by the company’s own hatchery or sold to other farmers in Ukraine, and the other half is exported to Moldova, Taiwan, Viet Nam, the UAE, and the US. The company also sells larvae, fry, and juveniles of sturgeons and other fish, including common, bighead, and grass carps, as well as pike.  About 2.5 thousand sturgeon juveniles a year are used to restock the Danube Delta.

The hatchery in Karnaliivka

Besides maintaining the broodstock, which is used solely for roe production, the company produces about 50 tonnes of sturgeons and 200 tonnes of cyprinids and other fish for human consumption on the domestic market. The fish are sold live through third parties all over Ukraine. Vylkove accommodates a processing unit for black caviar; current volumes reach one tonne annually and the plan is to produce three to four tonnes in the near future. The company also facilitates eco-tourism and leisure fishing in the Danube Delta, 10 kilometers from Vylkove.


The war arrives with a suitcase of problems

Nobody wanted to believe that the war would erupt. And when it did, it was a shock, which paralysed all business activities for some time. However, the farming season was starting, and work at the company had to proceed. We could hear the shelling of Snake Island, it was scary, but we kept working, says Ms Sumenkova.

The war brought a number of problems—some universal and others specific to the country’s businesses. Firms were most affected in terms of human resources, logistics, and product distribution. Odessa Sturgeon Breeding Complex employs 55-60 people working full-time. Within 25 months of the war, staff turnover fell by half and the workforce challenges still continue.

Another problem relates to logistics. In the case of fertilised roe, it is quite severe: such roe is categorised as a “live fish” product, and due to EU law, non-EU countries cannot supply to the Union without government-level approval, which Ukraine does not have. This also applies to transit. Despite being close to the Romanian border, the company could not route exports through Romania but would use Kyiv or Odessa airports instead. But since flights from Ukraine for any civilian purpose is no longer possible, the company has had to re-route exports overland through Moldova. This significantly increases the delivery time not only because of the distance, but also due to complex transport conditions and bureaucratic procedures. Fertilised roe is a perishable product so the company strives to limit the delivery time to 24-48 hours, despite the risks and uncertainty involved in commercial transportation.

Partial loss of the domestic market is another result of the war. Most customers for cyprinid juveniles were located in the south-east of the country, one of the centres of wartime destruction. Most of them do not exist any longer, and logistics to the central and western parts of the country have become much too expensive, therefore sales of juveniles are stagnating.

Can a war teach anyone anything?

Eurofish asks each of the interviewed Ukrainian companies this question, and the answer in all cases has been a resounding “yes.” The war has placed immeasurable burdens on Ukrainian seafood companies and their workers but resilience and imagination in defending and rebuilding operations has been the consistent response. “War is a disaster and life is the highest value,” says Mr Katrechko, “we live on a powder keg. We do not know what will happen tomorrow, we can make plans, but tomorrow a missile could fly in…and what then? We keep going to do what we can to support our business and, overall, our country to the best of our ability.”

In the face of war, Ukraine’s companies have discovered reserves of strength and determination that they were unaware they possessed.

Aleksandra Petersen

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