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German aquaculture continues despite energy crisis

Germany has taken a more proactive stance on its local aquaculture development as Europe’s energy crisis continues.

The energy crisis, triggered by Russia’s war in Ukraine, has exacerbated many challenges for the country’s aquaculture sector. The country’s high level of bureaucratization has put additional pressure on the industry and has led to bankruptcies for many local producers.

The ever-growing demand for fish in Germany and the high cost of imports create conditions for the more active development of local aquaculture, particularly the segment of fish farming. In recent years, the importance of its development has been acknowledged both on the German federal level and the level of federal lands of the country. That led to increased financial support.

In November 2022, the European Union announced that it is allocating €211.8 million (US$230.5 million) towards aquaculture development in Germany from 2021-2027. Aquaculture and hatchery operators can apply for special funding for 50 per cent of the additional costs caused by the war in Ukraine in 2022 and up to a maximum of €20,000 (US$21,764).

“The conflict in Ukraine caused prices to skyrocket in 2022, especially for animal feed and energy. We want to particularly support aquaculture as a future-oriented industry in overcoming the resulting problems,” says German Agriculture Minister Till Backhaus.

At present, the annual volume of fish production in Germany is estimated at only 300,000 tonnes (including molluscs and crustaceans) with a value of about US$500 million. Of these, 29 per cent accounted for aquaculture. In comparison, the annual volume of fish production in Russia is almost five million tonnes.

Fighting bureaucracy

While in recent months the situation in the industry has generally stabilized, most German analysts say the current situation in the industry remains generally complex.

Such a position has been recently expressed by Bernhard Feneis, president chairman of the German Aquaculture Association. As Feneis told Hatchery International, the current demand for farmed fish in Germany (particularly for trout and carp) remains strong, however, further growth of production is prevented by imperfect legislation and the existing administrative barriers.

“Traditional fish hatcheries, for carp and trout is not growing. It is fighting to survive instead,” says Feneis. “Not because of market problems, but our politicians export the production and give even private property to nature protectors and their interest. We as fish farmers get some compensation, but we lose our fish, our property and the basis to get income for the family.”

The entire EU-level bureaucracy has been identified as one of the main inhibitors of aquaculture investment and development in Germany. As representatives of leading German fish farms have recently said, the administrative barriers to securing a licence need to be reduced to encourage entrepreneurship and private funding in the German fish farming sector.

Parallel to this, spatial planning in coastal areas and river basins will also help guarantee aquaculture producers adequate access to the space and water they require, whilst minimizing impact on the environment and related sectors.

“To provide the demand, we need far more fish than we can grow. And because consumers are now also trying to save money, the high price segment is more suffering than the cheap productions,” says Feneis.

Most of interviewed analysts said the provision of state support to German fish farmers is excessively bureaucratized, being a subject of approval from up to 10 different ministries on both federal and regional levels.

“That means needs usually up to four years to get funds. We always get the money two to three years after the next period has already started,” says Feneis. “If you invest before you get the okay, you are out and don’t get anything. The funds, which are provided by local authorities, like from Bavaria, are faster and easier to get, but the percentage is not that high and always strictly bound to stocking density nature protection. Support for investment may not exceed 50 per cent (excluded VAT) and support for production is only for more than 3,000 square metres.”

German fish farmers can also take advantage of a rural development program, which is currently implemented on the federal level of the country.

Growing resources

Fabian Schäfer is an official representative of the Leibniz Institute of Freshwater Ecology and Inland Fisheries (IGB), one of Germany’s largest and leading international research centres for freshwater. Schäfer is also one of the founders of a German analyst agency in the field of fish hatcheries and farming, Aquakulturinfo.

According to Schäfer, a large part of the governmental support to the sector is provided by the European Maritime, Fisheries and Aquaculture Fund (EMFAF). As some available funds for regional development etc., the EMFAF is distributed on the level of the federal states and the focus may vary.

“Very few farmers produce just fry or just fingerlings – but often they are the big ones – due to pressure of laws or administration small farmers are not able to restock with their own spawners,” adds Feneis. “Most small farmers buy bigger young fish from professional farmers because their own opportunities to nurture fry and fingerlings are limited. The main production challenge is loss of small fish by predators, mainly the cormorant.”

According to analysts, a shortage of fingerlings, in recent months has become a significant problem of the industry, which prevents its more active growth and development. As a rule, Feneis says most of the breeding material comes to Germany from Denmark or France.

Fish feed high-value protein from natural sources (zoo- and phytoplankton). Instead of fishmeal or soy-based nutrition, farmers only feed fish with a mix of cereals –sometimes only with legume crops (triticale, barley, lupines and peas).

Move to sustainability

According to local analysts, additional pressure on the German fish farming sector is put by the ever-growing demand for sustainability and organic issues.

In this regard, the industry has almost completely refused the supplies of breeding material produced under environmentally and socially problematic conditions, primarily from the Asian region. According to analysts, regional products are becoming increasingly important, and the coronavirus crisis has intensified this effect even more.

According to Dr. Stefan Meyer, coordinator of the competence network of aquaculture, the main finfish species are common carp and other cyprinids produced in warmwater ponds and rainbow trout and other salmonids produced in flowthrough and raceways systems. Other freshwater species encompass sturgeon, catfish, eel, pikeperch and perch.

As the production costs are growing (with only costs for heating representing about 15 per cent of the total costs of production), particular hopes of fish farmers are put on the support from the state from various funding schemes and a switch to alternative energy sources, such as biogas plants, which in recent years have gained popularity in Germany and its fish farming sector.

Help for family farms

In contrast to other EU states with well-developed fish farming sectors (such as Denmark), the German industry is characterized by a very low level of consolidation, being comprised of hundreds of mostly family-driven enterprises.

The pandemic and recent energy crisis in the country led to a significant decline in these figures as many producers had not been able to withstand these tough times. The sector also suffers from a lack of skilled workers, though this is typical for the entire industrial sector of Germany these days.

Despite this, the market is still dominated by small and medium-sized fish farms, a significant part of which is currently located in the southern states of Bavaria and Baden-Württemberg.

Schäfer told Hatchery International that hatchery production in Germany is fragmented because individual producers also run hatcheries for their own farm or for regional distribution.

“As an interesting fact, the most important product on the German fish market (fisheries and aquaculture products) is salmon. However, not a single salmon is produced in Germany for consumption,” says Schäfer. “While the potential for future growth of the fish hatcheries sector in Germany has been identified, a variety of inhibiting factors, such as conflicting goals of fish farming and conservation or administrative barriers, is restraining the development.”