Latvia wins $207,000 at EU fishing derby

RIGA – The EU and Latvia fisheries divided up some of the sea and what it contains on Nov. 11, but competition, low prices and Russian buyers with no money may keep some fishing boats in port next year.

Such factors made Latvian negotiators come out of a meeting in Brussels with fewer fish for 1999 but lots of lats for fish industry development in their pockets. That's just fine by fishermen, a Latvian fish industry leader said.

"Our fishermen aren't interested in catching many salmon," Inars Voits, head of the Latvian Fishermen's Association, said.

The quota agreement controls access to the harvest, allowing 52 Latvian fishing boats and three tenders on EU waters per month. According to the pact, Latvia can pull 79 tons of cod from Swedish waters. In other EU salt water, Latvian fishermen can take 1,600 tons of cod, 6,000 tons of brisling, and 1,000 salmon. For cod, that's a decrease of 900 tons over last year's quota.

At the same time, EU fishermen in Latvian seas can haul out 540 tons of cod and 13,000 salmon. Ten thousand of the salmon had Latvia's name on them, but because of low interest in salmon fishing among Latvian fishermen, Latvia yielded 10,000 from its quota to the EU. The EU sent Latvia home with 120,000 lats (about $207,000) for fish projects.

When do fishermen want to fish less? When competition and prices make dangerous work hardly profitable, Voits said. Norwegian farm salmon coming into Latvia, with low import duties at 4 percent next year and 0 percent after that, have given Latvia's wild salmon a hard fight for market share.

Added to that is a danger factor not to be courted for low prices. The Finns and Swedes use bigger boats equipped with long lines with hooks, enabling them to catch greater volumes of salmon more safely, giving them an advantage in autumn and winter months when seas are high, Voits said. Latvian salmon fishermen are still using small boats with gillnets, a dangerous way to fish.

"We stop going out in gillnet boats when the seas are over eight meters," Voits said. "They can go out with their hooks when the currents are strong."

Prices are not good. The price of sprats, the small marine food fish that is a staple of the Latvian fish sector, has fallen 15 percent, Voits said, with a kilogram bringing only 12 santimes (about 20 cents) against a fair price of about 15 santimes.

For the present, fish quotas are merely shop talk with half of Latvia's fish processing companies shut by the interruption in orders from Russia's fish buyers, according to Voits.

More than 20 out of 44 processors have stopped production, putting about 5,000 people out of work. Some of these factories and their layoff numbers are as follows: Brivais Vilnis, 600; Auda, 300; Unda, 167. Others have reduced employees to the number needed to process small local orders, as at the cannery Roja where only 50 of a normal crew of 600 are on the job. Processors still operating have had double digit layoffs also.

Some canneries are coming back, as Salacgriva '95, which opened Nov. 9 with a reduced staff of 225. Ave Lat, the major stakeholder, is searching for new buyers with new products, marketing manager Ainars Lodzins said.

Some factories are beginning to process fish as a prepared, ready-to-eat product to entice Western buyers, but Voits doesn't see this as a solution. He doesn't see drastic changes in processing as worthwhile when the EU market quota is so limited, he said.

"Our process is small, producing about 250 million cans a year. The EU quota will take only two million cans. That's less than one percent."

Voits is holding out hope that the once lucrative Russian market will again take fish from Latvian processors' conveyor belts, but he expects a wait of five or six months before the Russian economy stabilizes.

Meanwhile, processors are bartering very limited amounts of canned fish for fuel and tin for fish cans from Russia.

"They want our fish. We just don't have a way to get money from selling them our product," he said.

In the long term, Voits sees a use for 120,000 lats. He proposed that the Latvian government loan money interest free to processors to keep employees on the job and for upgrading factories. As collateral, the fish companies could offer cans of fish to be bought back when the market improves.

Economics Minister Laimonis Strujevics said last week that he does not approve of giving government lats directly to fish processing companies to replace profits lost from the evaporation of export opportunities to Russian buyers, but that there may be money for sector-wide improvement programs.