“Fish farms cannot stop their activity and wait for the storm to pass”, says FEAP

Net enclosure for aquaculture

FEPA is concerned about the slow deployment of compensatory aid for fish farmers who suffer losses due to the war in Ukraine and rising production costs
© Fusion Marine

Production costs in fish farming have increased massively since mid-2021. The consequences of the Covid-19 crisis and the war caused by the Russian invasion of Ukraine have caused input costs to skyrocket. Market selling prices have also increased, but to a much lesser extent, and fish consumption has decreased in most EU Member States.

The critical cost situation of fish farming is, in principle, similar to that of other economic activities. However, a key difference is that fish farms cannot shut down and wait for the storm to pass. Fish stocks need to be constantly fed and cared for, so producers face higher costs regardless of the circumstances. Large and small European aquaculture companies risk their survival in the coming months. Public aid specific to the aquaculture sector has not reached its theoretical beneficiaries.

Fish farming in Europe is a very diverse sector producing over fifteen different species through a variety of farming systems, both in fresh and marine waters. The sector is made up mainly of micro and small primary production companies, each of which has been affected by this crisis with different degrees of intensity.

Common impacts are exorbitant feed prices for farmed fish, unavailability of certain feed raw materials – including organic inputs, soaring energy prices, excessive liquid oxygen prices, transport costs, the rate of inflation which affects packaging materials, maintenance and labour. .

buyer holding two different types of fish
Retail fish prices have increased over the past year

Fish consumption has fallen in the majority of EU Member States

Higher costs translated into higher first-sale fish prices and higher end-consumer selling prices, but this happened asymmetrically. The increases in selling prices were proportionally less than the surge in production costs. Nevertheless, consumers are finding it difficult to pay the high prices for fish – the consumption of aquatic products has already fallen in the majority of EU Member States. In times of crisis, consumers tend to forego fish and opt for other forms of animal protein, even if they are of lower quality. This trend is unwelcome for the industry, but also has implications for food security, as low-income families often decrease their intake of healthy, nutritious foods when faced with a price crisis.

The EU response

The European Commission was quick to propose compensation plans at the start of the Ukraine crisis and these were immediately adopted by the European Parliament and the Council of the EU. In March 2022, a temporary crisis framework was approved to support the economy. Also in March, the Commission activated new crisis measures to support the fisheries and aquaculture sectors in the context of the Russian invasion of Ukraine.

It arrived through the crisis mechanism of the European Maritime, Fisheries and Aquaculture Fund (EMFF) aimed at providing immediate relief to operators through financial compensation for their economic losses and additional costs. . This would allow Member States to grant financial compensation to operators for loss of income due to market disruption, as well as storage aid to producer organisations.

European Commission
The European Commission

The European Commission was quick to offer compensation plans at the start of the Ukraine crisis, but the deployment of funds has been slow

In April, the Commission presented a second package of crisis measures through a legislative amendment to the European Maritime and Fisheries Fund (EMFF) allowing additional crisis measures to support the fisheries and EU aquaculture.

The facts on the ground

Despite these measures, FEAP notes that seven months after the start of the war in Ukraine, none of the so-called urgent compensation has reached EU aquaculture operators. This can be attributed to the complexities of managing approved aid at national and regional levels. However, FEAP argues that managing authorities may take an overly cautious approach when paying out the approved compensation.

Compensatory aid rules for fish farmers have been established taking into account a certain maximum amount per company. It seems that some producers have applied for compensation for each culture site instead of making a request within the framework of large fish farming enterprises. Most fish farms own and manage multiple sites at once. The established procedure makes the amounts of assistance available insufficient in most cases.

According to FEAP, fish farmers in the EU are in a critical situation and the situation is made more difficult by an unfavorable legal framework which hampers entrepreneurship and investment. This makes the EU aquaculture industry less resilient and more vulnerable to economic shocks. Efforts to make fish farming profitable have failed due to the overly cautious implementation of European environmental laws at national and regional levels. To address this, FEAP advocates the establishment of legally binding aquaculture production targets for each Member State.

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