October 30, 2014

 

Russia-based salmon processor files for bankruptcy

 

 

Tehnolat, a Russia-based salmon company, has begun legal proceedings for bankruptcy, Undercurrent News reports.

 

According to an unnamed source, the bankruptcy petition was filed by the tax authorities, with a US$1.4 million claim against Tehnolat. In the meantime, a local court has ordered for the company's money and bank accounts to be blocked.

 

The source added that Tehnolat will have to deal with significant debts with Norwegian suppliers such as Leroy Seafood Group and Norwell. The company is known to import salmon mainly from Norway, which it then sells under the brand "Salmon House".

 

The trade sanctions between Russia and Western nations are the cause of Tehnolat's current trouble, according to Dmitry Chemakin, the industry and trade minister of Kaliningrad, Russia. Such events disrupted the supply of Norwegian salmon to Russia, he said.

 

Kaliningrad-based Tehnolat also faced higher competition from other Russian importers.

 

Until recently, Kaliningrad-based companies supplying salmon to Russia enjoyed duty-free privileges.

 

Since it can no longer export salmon to Russia, Tehnolat no longer enjoys such tax relief, thus compounding the company's financial troubles.

 

Until its embargo, announced in August, on food products from the US and the EU, Russia imported 2,000 tonnes of salmon monthly from Norway.

 

As it struggled to maintain operations, Tehnolat shifted processing works to Belarus as salmon from the country can still be sold in Russia if significantly processed beforehand.

 

However, such a move may not come in time to save Tehnolat, said another source who observed that the company's production volumes have been declining for years.

 

Tehnolat was reported to have generated US$68 million in revenues in 2013 at a gross profit of US$11 million.