Ukraine’s fish farming business: Impacts of Russia’s war against Ukraine

by Eurofish
Oksana Prokosa

Ukrainian aquaponics farm survives war damage with imagination and personal strength

AquaFarm is the only company in Ukraine that combines the production of fish and vegetables in an aquaponics system. The company was established by a lawyer couple who wanted to start a business that their two children would inherit and that would provide fresh, natural, locally produced vegetables and fish all year round for their customers and themselves. The couple studied agrarian business and travelled to different countries for ideas and inspiration for their start-up.

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

This article was featured in Eurofish Magazine 5 2023.

The couple chose aquaponics because it is a compact, energy- and water-saving production process that can be established in a city. Ukraine’s dependence on fish imports, which increased after the illegal annexation of Crimea in 2014 and the subsequent closure of many Black Sea and inland fishing grounds, also motivated their interest.

Integrating vegetable growing and animal raising in a single unit

The farm’s construction started in 2016, says Ms Oksana Prokosa, AquaFarm’s founder and director, and currently includes 3,500 square meters of greenhouses, a fish farming facility, and two processing units, for a total area of 0.86 hectares. The latter are “cold” and “hot” facilities: in the cold one fish are slaughtered and prepared for either the retail sector or for further processing in the hot shop – primarily smoking and dry-curing. Tomatoes, basil, and various green salads are grown in the greenhouses, while African catfish and tilapia are farmed in the recirculation aquaculture system (RAS). The company uses solar batteries and has its own boiler house to supply additional energy and heating – depending on the season and weather conditions. Both catfish and tilapia require a water temperature of around 26 degrees C. The nutrient-rich effluent water generated in the RAS is cooled by 1-2 degrees and supplied to the greenhouses. AquaFarm has a HACCP plan in place and is certified to the ISO 22000 standard, ensuring the products’ quality and safety at each step of production. On average, production of catfish reaches 200 tonnes, while for tilapia it is 20 tonnes per year.

In the beginning, fish fry and broodstock were imported from the Netherlands. However, the covid restrictions made such imports impossible and the company started their own hatchery to provide enough stock for year-round production.

The most difficult issue in aquaponics is to keep the right balance between two units, fish and plants, explains Ms Prokosa. Each of them requires water that meets certain criteria, and these criteria must be continuously monitored to ensure the successful coexistence of the two.

Sales grow as products are fine-tuned for specific market channels

AquaFarm started fish processing at almost the same time that they produced the first harvest. Fish sold as a raw material is not as competitive and does not have the same consumer demand as processed fish, explains Ms Prokosa. We like to make the lives of our customers easier by offering them semi-processed fish so they will spend the minimum effort to cook a meal. Our catfish is processed into fillets while tilapia, due to its smaller size, is sold whole/gutted or as fillets. All these products are either chilled or in MAP packaging – never frozen, to ensure the customers get the original taste of the fish and that no nutrients are wasted. Catfish fillets are also dry-cured or smoked  – cold or hot – sometimes with spices and herbs. Recently AquaFarm started producing catfish pates with adding various ingredients like pumpkin, bell peppers, aubergines, tomatoes, or soft cheese.

One of AquaFarm’s premium products – hot-smoked African catfish fillet with spices and herbs

The distance between the town of Vasylkiv, where the production is located, and Ukraine’s capital Kyiv is only 25 kilometres, which makes farm-to-store transportation time very short. The company has its own refrigerated trucks which also helps to minimise the delivery time and ensure the freshness of the products. Fresh fish is distributed through large retail chains, while smoked products, which are the company’s speciality, belong to the premium segment and are sold exclusively to restaurants, pubs, and shops selling craft foods. The HoReCa sector is the largest customer for AquaFarm’s tomatoes and greens, while smaller volumes are sold through craft stores.

The Russian war damages but doesn’t destroy operations and business confidence

At the beginning of the war when Russian troops were in the Kyiv region, Vasylkiv was severely attacked as it hosts a military airfield. For security reasons, the blackouts became obligatory for both businesses and residential areas during the night, and the power for streetlights was cut off. We were preparing for spring planting, recollects Ms Prokosa, but due to the power shortage all the sprouts died. Later, as a result of the attacks, the greenhouses were heavily damaged. All female workers with their children moved to safer areas leaving only Ms Prokosa’s husband and three other men to keep the facilities functioning, as the fish need constant care and food.

AquaFarm’s greenhouse before the war and after the shelling in spring 2022

Already on the third day of hostilities, AquaFarm’s men began helping the army. The local military unit needed hot food supplies, and the employees started to cook for them. First, they used their own fish and groceries from the company’s small store. When the stocks were emptied, the local people started bringing carrots, potatoes, beetroots – whatever they could, to continue providing for the defenders. Everybody realized the importance of such support and contributed their fair shares making it possible to supply the army with hot meals for three months. AquaFarm also donated two tonnes of their fish to a processing company that was producing canned fish for the Armed Forces of Ukraine.

The power cuts were not the only problem. When the war began, infrastructure was disrupted and there was no access to the Kyiv region. AquaFarm had some stocks of fish feed, but only enough to last for a relatively short time. The company was on the brink, but then Russian troops were forced out from the region, and it became possible to replenish the stocks, so no fish were lost.

Restoration requires business innovation as well as personal strength

As the Kyiv region became relatively safe AquaFarm began to restore the greenhouses and today the vegetable production is almost back to what it was in pre-war times. However, things are not the same as they used to be. Production costs have increased due to surges in the price of fish feed and energy.  Repeated power cuts have forced the company to use its own power generator and buy expensive diesel fuel. These costs have influenced the end-price for consumers. Although about 8 million Ukrainians have moved abroad during the war, AquaFarm’s sales revenues, due to the proximity to Kyiv and purchasing power of Kyivans, have not shrunk significantly, yet the company wants to sell more and continues to work on it.

Last but not least, is the emotional and physical toll on Ukrainians: night attacks interrupt their sleep, bringing fear and anxiety. It can be very difficult, Ms Prokosa says, to get up in the morning completely exhausted after a sleepless night. You have no energy or even emotions, but you have to pull yourself together, gather your wits, and appear in your usual mood to communicate with colleagues, suppliers, and customers – to keep going.

Can a war teach anyone anything?

Yes! Ms Prokosa replies without a second’s hesitation. The war demonstrated to me — a mother and wife — that the single greatest value is having your family together, alive, healthy, and safe. Business, competition, and daily domestic problems recede into the background. Speaking as a citizen, it is very important to me that Ukraine wins, and we all will return to our normal, peaceful life, developing our businesses and our country.

Aleksandra Petersen

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