Russian invasion of Ukraine: Implications for the UK Seafood Supply Chain

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Russian invasion of Ukraine: Implications for the UK Seafood Supply Chain

An overview of the potential implications of global food-related trade disruption on the UK seafood supply chain following events in Ukraine.

The recent events playing out in Ukraine over the last few weeks are unimaginable and the impacts that this will have on us all are significant. It can seem odd to be discussing the ‘price of fish’ at a time like this, but seafood is one of the most heavily traded commodities and the horrific events taking place in Ukraine will impact on businesses and consumers in the UK, Europe and beyond.

We’re keeping a watching brief on how this might impact on the UK seafood supply chain. This article gives an overview of: • global whitefish supply and Russia’s contribution to that supply • the UK’s reliance on Russian raw material • implications from possible trade sanctions and inevitable trade disruption

We will be updating information here as the situation develops. Please check back for updates. If you would like further information or if your business is seeing impacts and you would like to share intel with us, please contact seafish@seafish.co.uk.

Seafood Trade and Production

Global whitefish production Global estimates of whitefish production for 2022 is approximately 7 million tonnes, with Alaskan pollock accounting for almost 50% of this.

Russia accounts for over 40% of global whitefish production, although it’s likely to be nearer 45% following the reduction in the US pollock Total Allowable Catch (TAC). It is the primary producer of Alaskan pollack (almost 60% share following the US TAC reduction) and produces over 30% of the global Atlantic cod supply and 25% of haddock.

Russian product has traditionally been exported to China for processing. In recent years, there has been significant Russian investment in at-sea and on-shore processing capability so we expect this trade to decline in future years. However the trade link between Russia and China is still important.

The UK is heavily reliant on imported whitefish. In 2020 the UK imported 432,000 tonnes with a value of almost £800m. This compares to domestic landings of cod and haddock of 47,200 tonnes in 2020.

Imports from Russia to the UK The UK is not self-sufficient when it comes to domestic landings of whitefish. In order to meet consumer demand, whether in fish fingers or in fish and chips, we need to rely on imports. Russia has been an important source of these imports for almost 30 years.

Direct imports from Russia accounted for 48,000 tonnes in 2020 but a considerable proportion of Chinese whitefish imports into the UK (which totalled 143,000 tonnes in 2020) will also be of Russian origin. It is also likely that some Norwegian, Polish and German imports into the UK will include Russian product. An exact figure is difficult to calculate but we estimate that it will be more than 30%. However some businesses and some parts of the supply chain will be more affected.

The challenge is that there is not an obvious or quick substitute for this product if it is no longer available to UK businesses, and nor is there an option to simply increase supply. Whitefish is a highly competitive global commodity and most supply is already under contract. Where product is available, the UK will be competing on a global market so it will not be easy to find a substitute to Russian whitefish. Any changes to the available supply will impact production; the products we expect to find in the supermarket freezer cabinet will either no longer be available or they will see significant price increases. Estimates are that raw material prices will increase at least by 20-30% as a result of current events. Margins are already tight across the processing sector and many businesses (especially smaller businesses) will not be able to absorb these costs.