Russian fish processors costs expected to rise by 540 mln rubles in 2026 due to environmental fee hike

MOSCOW. Sept 3 (Interfax) - The costs of Russian businesses that process common types of fish could grow by 540 million rubles in 2026 due to the significant increase of the environmental fee for recycling packaging, the Pollock Catchers Association (PCA) estimated.

"This will lead to an increase in production costs and will have a multiplier effect for the end consumer," the association said in a press release.

This refers to processing of common fish such as Alaska pollock, herring, cod, Japanese pilchard and plaice, as well as calamari, which account for about 70% of the total catch.

Public discussions on the draft of new base rates for the environmental fee for packaging recycling and coefficients for their indexation concluded last week, the PCA said. Under the draft, the fee will go up by five to six times, from 3,000-5,000 to 17,000-32,000 rubles per tonne, for all types of packaging used by fish processors. Multiplying coefficients of 2 to 5 will also be set for the fee rates, "taking into account the difficulty of recovering waste from the use of goods for subsequent recycling."

Fish processing plants in Russia's Far East paid the government more than 110 million rubles in environmental fees in 2024 for recycling of packaging materials used in production of frozen products made from the main types of fish (Alaska pollock, herring, cod, Japanese pilchard, plaice and calamari), the PCA said.

"If the changes are passed, costs will increase to 650 million rubles. This refers to the recycling of more than 33,000 tonnes of packaging materials. This is primarily paper, cardboard, polyethylene and polypropylene," the PCA said.

"In a situation where there is a long-term decline in the profitability of catching socially important types of fish, growth of accounts payable and collapse of profit, fishers face another increase in mandatory payments to the state budget," PCA president Alexei Buglak said in the press release, recalling that "in 2024 the fishing industry showed the worst financial results in the past five years."

"In the pollock sector, the situation is extremely difficult. Net profit tumbled by 90% to 2.4 billion rubles. The costs of businesses in the pollock sector - production, administrative and selling - rose by 8% in 2024 compared to 2023 and by 80% compared to 2018," Buglak said.

In light of this, the increase of environmental fee rates could exacerbate the situation and have a negative impact on the financial stability of a business on which financing for projects being implemented under the investment quotas program directly depends, he said.

The pollock sector accounts for about half of the projects being implemented under the two stages of the program - 21 vessels and 18 onshore plants, Buglak said.

The PCA said it hopes the specifics of the fishing industry and its financial health will be taken into account when the draft of the new environmental fee rates is finalized, and it has notified the Natural Resources and Environment Ministry of its position.