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300pc jump in landed price of sardines: Oman Fisheries

Business

4 days   ago

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A steep increase in the landed prices of seasonal fish species, notably sardine and cuttlefish, is among a number of factors contributing to hefty losses incurred by Oman Fisheries Company SAOG, the Sultanate’s largest integrated fisheries group, during the first half of this year.
The partly government-owned enterprise, which is also listed on the Muscat Securities Market (MSM), attributed the sharp spike in the procurement cost of these seasonal species to a crackdown on “foreign fishermen” operating in the Sultanate’s waters.
The “sudden strong action imposed by the government on foreign fishermen during the last couple of months had crippled collections at all potential landing centres in Oman, heavily affecting our procurement targets of seasonal species, namely sardines and cuttlefish”, said the Chairman of Oman Fisheries, in the Directors Report of the company’s unaudited, consolidated financial results for the first six months of this year.
As a result of the clampdown on unauthorised fishermen, landed volumes of sardines and cuttlefish were “sparse”, thereby resulting in a sharp increase in procurement prices, the Chairman stated. The landed price of sardines, for example, shot up to 240 baisas per kilo, as against the regular price of 80 baisas — an increase of 300 per cent. For cuttlefish, the landed price climbed to RO 2 per kilo, as against the regular price of RO 1.5 per kilo, he noted.
“This astronomical price had a severe impact on profitability, reducing our gross profit margin and slowing down our sales, as our prices could not match the international asking price which remained typically low due to the bumper harvest of those species at major catchment areas worldwide,” the Chairman stated.
Oman Fisheries Group comprises the parent firm, Oman Fisheries Co SAOG, as well as Oman Fisheries Co Sharjah (FZE) and Al Ameen Stores and Refrigeration LLC. The Group posted a consolidated turnover of RO 7.511 million for the January-June 2019 period, compared to a turnover of RO 10.197 million for the corresponding period of 2018. It incurred a net loss of RO 1.927 million this year, representing a 600 per cent increase over the corresponding figure for 2018. Also contributing to the loss were a number of “one-time corrective actions towards rightsizing of stock in terms of quantities and modifications of stock parameters”, it noted.
An intensive crackdown by Oman’s authorities has all but eliminated the activities of unauthorised expatriate fishermen operating along parts of the Sultanate’s southeastern seaboard. Their catch of mainly sardine, tuna and cuttlefish, among other seasonal species, provided a hitherto lucrative source of cheap feedstock for fish processing companies operating along these shores. The government, for its part, is keen for Omani fishermen and local businesses to make the most of economic opportunities associated with the country’s rich marine resources.

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Source: Oman Observer

 

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