Overview of Russian import of frozen and chilled trout revealing switch to fresh fish

The trout imports to Russia during 2007 continued to grow actively due to high demand and an outstanding switch from frozen to fresh products has been observed, the driving forces behind the development described further on in the article. Such conclusion has been made by analysts of https://www.fishnet.ru/ (http://www.fishnet-russia.com/) based on provisional data of Federal Customs Service (FCS) of Russia for 9 months of 2007.

More specifically, imports of fresh and chilled trout amounted to more than 11.585 metric tons, that is 345% up as compared to 2.600 metric tons in 2006. The import value increased even more - by 391% from 10.7 million dollars in 2006 to 52.7 million dollars in 2007. The growth of average price from 4.13 USD per kilo to 4.55 USD per kilo has also contributed to the increase.

The data about import growth to Russia are confirmed by the data about Norwegian export of fresh trout, where, according to NSEC, the volume also increased as compared to 2006.

According to provisional data of FCS of Russia for 9 months of 2007, the import volume of fresh and chilled trout from Norway to Russia got boosted by 1268% from 776 to 10.624 metric tons. A considerable supply growth was also reported about from Finland. The import volume from this country increased by 1386% from 33 to 492 metric tons. There is also a dynamic growth of supply being registered from Armenia (55% up from 21 metric tons in 2006 to 33 metric tons in 2007). It is worth noting that the average price for Armenian trout turned out to be the highest - 11.66 USD per kilo in comparison with overall average price 4.55 USD per kilo.

Against the background of rapid growth of the shipments of fresh and chilled products, frozen trout import has been decreasing. According to Norwegian data, for 10 months 2007 frozen trout export from this country to Russia was down by 74% from 13.058 metric tons in 2006 to 3.430 metric tons in 2007. As seen from the provisional data of FCS of Russia for 9 months of 2007, import of frozen Atlantic salmon (including trout) from Norway decreased by 70%. Thus there is a marked tendency of switching Russian importers from frozen to chilled products being observed.

According to the director of large company, specializing in import, there is a dynamic shift of supplies towards chilled products. This tendency can be explained by two factors. Firstly, the price for frozen products from Norway is about 20-30 eurocents higher than the price for chilled products. Secondly, it is far easier for processors to deal with chilled raw material without wasting time on defrosting. Besides taking into account the superiority of chilled raw material in quality in comparison with frozen raw material, Russian processors choose the first one.

Other major importers operating on the Russian market confirmed this information too. In the opinion of one of them, given such market conditions it is cheaper to import chilled trout to Russia and freeze it locally rather than overpay 20/30 eurocents in Norway as the cost of freezing in Russia is lower.

As the director of another company says, as per the beginning of September 2007, the Russian import volume already reached the level of the year 2006, showing thus dynamic growth.

The given trends are driven by the growth of demand, especially in big cities where living standards are higher. In its turn, the demand for delicatessen fish is increasing due to the growth of incomes which allows a consumer to buy expensive fish, go to restaurants and so on more often. The fast development of catering sector and the growth of popularity of Japanese cuisine also fuel the rise of chilled products import.

More specifically, the Russian import of trout from Armenia during 9 months of 2007 increased in volume terms by 56% from 21 tonnes in 2006 to 33 tonnes in 2007. The value of trout import from Armenia grew even more - by 78% due to price rise by 14.5%. The trout from Armenia can be distinguished from the bulk of imported trout as in this country Salmo trutta fario is grown. This species is mainly destined to the restaurants which specially order it at the farms. This fact explains the higher price for this product in comparison with other ones.

At present trout farming in Russia which is more actively developing in Russia's Republic of Karelia, bordering on Finland, is showing the highest profitability in food sector which on the average amounts to 30-50%. Given the production cost at the level of 80-90 RUB per kilo, the selling price can amount to 120-160 RUB depending on size, fishing season and market situation.

Thus, analyzing the trends and growth rates of aquacultural development in Karelia, it can be assumed that in the foreseeable future the Karelian trout will put competitive pressure on trout import from Norway and Chile and take up some of its share in the consumer segment of the Russian seafood market.

Table 1

HSC 030211- trout (Salmo trutta, Oncorhynchus mykiss, Oncorhynchus clarki, Oncorhynchus aguabonita, Oncorhynchus gilae, Oncorhynchus aрache and Oncorhynchus chrysogaster) fresh or chilled

Note: the table has been compiled by FISHNET analysts from provisional FCS figures

Although at the moment of writing there was no data at hand about frozen trout import separately from Atlantic salmon, it is worth noting that on the Russian market new suppliers have appeared. So, in January-September 2007 France exported to Russia a little more than 37 tonnes of frozen trout worth 96 thousand dollars. This information is confirmed by Globefish data about French export. French trout value amounted to 2.55 USD per kilo.

Besides, Turkish exporters are boosting their sales onto the Russian market, offering the products at the international exhibitions such as Seafood Russia. For example, there were 5 Turkish producers and processors of rainbow trout taking part at the last exhibition in 2007. It is supposed that this gave Turkish exporters an opportunity in January-September 2007 to supply to Russia more than 32 tonnes of frozen trout worth 96 thousand dollars. The average price for trout from Turkey amounted to 2.97 USD per kilo. The supplies of frozen Atlantic salmon and trout from Finland have also dramatically increased. For example, during the 9 months 2007 Finland exported to Russia 684 tonnes of products worth 1.1 million dollars. The average price for Finnish frozen products turned out to be one of the lowest - 1.62 USD per kilo.

From the table below it is evident that Russian import of FROZEN Atlantic salmon and trout has been continuously decreasing. In spite of the growth of export from the most suppliers, export volume from Norway to Russia decreased by 70% from 29.541 metric tons to 8.851 metric tons. The export growth from other countries couldn't compensate for such sudden decrease of Norwegian frozen supplies. As a result, in January-September 2007 total Russian import of frozen Atlantic salmon and trout from all countries went down by 23.5% from 39.722 metric tons to 30.386 metric tons. Import value came down to a lesser extent owing to the rise of import prices from 3.66 USD per kilo in 2006 to 4.05 USD per kilo in 2007. Import value for the period of January-September 2007 totaled 123.2 million dollars in comparison with 145.3 million dollars in 2006 (15.2% down).

Table 2

HSC 0303 2 - Atlantic salmon (Salmo salar), including trout (Salmo trutta, Oncorhynchus mykiss, Oncorhynchus clarki, Oncorhynchus aguabonita, Oncorhynchus gilae, Oncorhynchus aрache and Oncorhynchus chrysogaster), frozen