Kharkiv businessman Alexei Bogach loves red caviar. Not only because it’s a good food. For Bogach this is, above all, a good source of income. Rybanov firm owned by him is Ukraine’s largest breeder of valuable fish species. The company grows its main products — sturgeon and trout — from roe in its own incubators. The price for a kilogram of sturgeon and trout is up to 200 hryvnias. About 50 tons of fish from Rybanova come to the shelves of Ukraine’s largest retail chains each month.
Rybanov bred its first fish in 2005. Several sturgeons lived for fun in a paddling pool in the backyard of Oleg Didenko, one of the company founders. The fish did unexpectedly well and grew fast, and Didenko liked this. After a year he decided to repeat the experiment, but on a larger scale. In the village of Pavlovka, which is on Mzha River in the Kharkiv Region, he rented a riverside piece of land and built his first nursery. The place was chosen wisely. Due to springs bubbling from the river bed the water temperature there does not exceed 12 degrees — a perfect condition for trout breeding. In order to prevent water freezing in the outdoor nursery in wintertime, Didenko, an engineer by qualification, developed a special closed water circulation system, which prevented icing even during the coldest winter days. «In fact, it was the simulation of environment present in fast and cold mountain rivers, where trout originally harbors», says Andrey Atozhenko, the company’s CEO.
The fine tuning of the production environment paid off. Trout fry, which Didenko bought in Poland, did well in new conditions. After a year the fish factory already received the first harvest — about 10 tons of commercial fish. It was enough to saturate the market of Kharkiv city. However, sales did not grow as fast as the company wanted. Ukrainian consumers clearly were not ready to introduce trout into their daily diet. Consumer did not like the price — the delicacy fish was almost twice as expensive as usual carp, crucian and silver carp. In addition, the market picture was spoiled by numerous poachers that sold their catch on the market at bargain prices. “For example, the cost of a kilogram of sturgeon bred on farms was about $10, and poachers asked $3 for the similar kind of fish”, says Alexei Kurchenko, CEO of Fishmatik, which manufactures fish-farming equipment. The fish importers from Turkey and Greece, which imported the fillets of valuable fish species to Ukraine, were also Rybanov’s competitors on the trout market. Ukrainians are used to buy fillet part of the fish weighing 7–8 kilogram, while Rybanov entered the market with fish pieces of 300 grams. “We have to teach Ukrainian consumers”, continues Kurchenko.
The Kharkivers decided to attack the market from the rear. They gave their emissaries pilot trout batches and sent them to the management of the local retail chains. “We started convincing the retail managers to cook our trout at home”, says Atozhenko, who led this special operation. The raid was successful. Six months later, Rybanov fish hit the shelves of Class and Rost retail chains in Kharkiv. “Then we started receiving orders for our fish from other cities”, says Atozhenko.
But to expand further on the company needed investments. Didenko invited Alexei Bogach, a famous Kharkiv businessman, to join his business. The new partner joined the company with fresh ideas and a lot of money. He decided to run not only exotic trout breeding, but also to breed catfish, which is more familiar to Ukrainian customers, as well as thermophilic sturgeon and beluga. The Kharkiv firm decided to open a new fish factory in a suburb of Donetsk, in the heat exchange pond of Mironovskaya Heat Power Plant. This way the firm was killing two birds with one stone — it could enter the market of the neighboring region and save on water heating. As the water in the pool is heated by the technology circuits of heat power plant, the temperature in the pool does not drop below 20 degrees even in winter. Within a year the company doubled its output to 30 tons and its products hit the shelves of Kharkiv supermarkets that belonged to national retail chains ATB and Fozzy Group.
By 2011, Bogach’s company supplied about half of all live valuable fish to the Ukrainian market. The second half of the market was controlled by Greek and Polish fish importers. A full fish-farming cycle was their advantage. They did not purchase fry separately, but grew it in their own incubators from impregnated roe. The same year Rybanov opened a similar incubator at Biuk-Karasu river in Belogorskii District of Crimea. The mountain river, fed by springs, was an ideal place for growing cold-water trout fry for other branches of the company. That year Kharkivers finished their expansion at the local market and opened their trout fish farm in the Village of Senkovka, 35 kilometers from the capital of Ukraine. According to Atozhenko, owning factories in different parts of the country allow the company to save on logistics.
In addition, the company solved the eternal problem of fish factories — fish transportation. Trout could barely stay alive for an hour in conventional tanks, so the company decided to buy special tanks for transportation of its products. The containers were equipped with special air pump, which ensure the fish can breathe on the trip, as well as with a special anti-bacterial coating and temperature sensors. In 2009, the company had 15 such tanks, each costing 4,000 euros. But the purchase paid off. During the year the company doubled its sales to 40 tons, which made Rybanov the major supplier of fish in Eastern Ukrainian and a significant player in the national market. “Their products are represented in different regions and this way they grabbed a large chunk of the market. They have powerful logistics. For example, their truck never travel empty from Kharkiv to Donetsk — they bring carp there and sturgeon back”, says Kurchenko.
The market itself gives tips on how to win customers. According to Atozhenko, many gourmets were confused with the color of Kharkiv trout’s meat. The majority of Ukrainians naively believed that the trout meat should necessarily be red, although the natural color of the trout is pink or beige, and it turns red only during spawning. The company decided to play up to stereotypes. In order to make the fish meat red the company bought fish food containing a special pigment in Denmark and Norway. The new batch of trout from Rybanov already had a ‘correct’ color. Since then the customers never wondered why the ‘red’ fish from Kharkiv is not red. “The launch of this particular product item at the market has taken almost a year. We painted the fish meat, and now it’s red all year round”, said Bogach.
The ongoing economic crisis is a serious challenge for the company. Last year its Crimean fry nursery was expropriated by Russian occupation authorities of the peninsula, and the Donetsk farm was destroyed by shelling. About 100 tons of marketable fish were lost. “Sometimes we felt utterly discouraged to continue all this. The reason is that we had a fine-tuned fry farm in Crimea. And we’ve managed to take out only 10% of our fish from Donetsk. We’re still clearing up this mess”, said Bogach.
Once the situation in the frontline area changed, the company rebuilt its Donetsk business. It moved the Crimean fingerling incubator there. The company’s plan is to increase fish yield to 100 tons per month and accelerate the in-house production. The company supplies not only live, but also gutted fish now. Trout is very profitable raw material. “Only about 15% of its weight is lost after gutting, which is half as much as that of carp”, says Bogach. The company also plans to sell sturgeon caviar under its own brand. Kurchenko believes this will dramatically increase the company’s profits. “Caviar is always the company’s net profit, which stays with us after the fish itself was grown and sold”, adds Kurchenko.
The economic turmoil in Ukraine may play into the hands of the businessmen. According to the Chairman of the State Fish Agency Iarema Kovaliv, after the devaluation of hryvnia the prices of imported fish surged, and the import of such fish fell by 40%. “The time is ideal to substitute imports by supplying fresh and affordable Ukraine-grown fish to the market”, says the official.
Text: Maxim BirovashПідписуйся на наш Telegram. Стеж за новинами у зручному форматі!