Prospects of import substitution in the segment fishing ships

According to the industry monitoring system, total production of bioresources by all Russian companies by 11 September 2019 amounted to 3,651,980 tonnes including 58,760 tonnes caught in inland water bodies. That is 2.0% (or 75,170 tonnes) less compared to the previous year.

RF Ministry of Industry and Trade says the demand for fishing ships by 2035 exceeds 250 units taking into consideration of worn out and obsolete ships.

Despite skeptical expectations, state support of shipbuilding for the fishing segment is quite active. Russian shipyards have already signed contracts for construction of 43 ships and 25 processing plants for more than RUB 160 billion.

Not only do domestic shipyards build ships for the civil fleet, they also implement innovative projects for construction of marine equipment. Modern vessels will consume less fuel and will be equipped with automated fish processing equipment. Besides, they are designed for operation in ice conditions.

USC experts confirm the advantages of having ships built in Russia emphasizing that operational costs compared to ships of similar designs built in other countries are the same while fishing companies opting for national shipbuilders obtain significant privileges, primarily in taxes.

Unfortunately, the general picture euphoria is shaded by a number of circumstances. According to the media, Russian shipyards had not built fishing ships for over 40 years which leads to non-compliance with the construction terms. Domestic design bureaus do not have sufficient experience either when it comes to designing of such ships; even in the ‘golden age of shipbuilding’ (1960–1980), soviet fishing fleet was generally expanded with ships built in the countries of the Warsaw Pact.

Domestic shipyards have obtained working projects of European designers (mostly Norwegian ones). Building of vessels to the designs developed by a global leader in the field of sophisticated fishing ships is quite logical, the more so as it allows for a fast transition to the phase of construction. Besides, the cost of the design does not exceed 5% of the total ship construction cost even taking into consideration the need to ensure compliance with the RS requirements. However, up to 70% of a trawler cost is priced in at the phase of technical design. It includes the cost of equipment and materials with imports accounting for 50% and domestic ones – for 20 %.

The situation is aggravated by sanctions considerably hindering supplies of foreign equipment. Complete transition to equipment of Russian origin is not possible today. First of all, it is because of foreign designs which do not foresee any import substitution (not only for economic reasons but also amid absence of information about Russian counterparts). Besides, there are no domestically produced alternative to some equipment. According to Aleksandr Solovyov, General Director of Vyborg Shipyard, fish processing equipment is not produced in Russia with an opportunity of local production showing no prospects so far.

Obviously, construction of fishing fleet is not a linear process. One of the first shipyards to commence construction of large fishing ships was Yantar which offers vessels of different types and sizes with a possibility of modifications for certain species and types of processing, as well as new designs to be developed from scratch. Designs of mid-size and large-size trawlers were developed by Norwegian companies Skipsteknisk, Wartsila Ship Design, Nordvestconsult and Spanish company Cintranaval Defcar with participation of Russian design bureaus, Vympel and Hotchya Marine Engineering. The construction can be fully completed at the facilities of Yantar shipyard in Kaliningrad. Onboard equipment, both general and special one, can be selected by customers or recommended by a design bureau from the list of equipment offered by manufacturers of Western Europe, East Asia and Russia. All that equipment will be further serviced by a manufacturer at the ship’s home base.

Russia’s capabilities in the field of import substitution for civil ships is covered by IAA PortNews article >>>> . The situation is the same in the segment of fishing ships: import substitution will become realistic only with the government’s special support programme for shipyard.

An enormous advantage of such a programme would be a transparency of Russian shipyards’ procurement portfolio. The customs statistics provides poor information on the purpose of imported equipment, analytics does not identify equipment for construction of ships.

Data platforms covering procurement under federal laws NoNo 44, 94 and 223 are not universal either.

Only upon obtaining a comprehensive picture of shipyards’ requirements, certain plans on diversification of Russian manufactures can be developed in the interest of fishing ships.

Andrey Krulev

Read more about construction of fishing ships in Russia >>>>