THE REPUBLIC OF POLAND

GENERAL ECONOMIC DATA - May 2007

2.  FISHERIES DATA

Commodity balance (2003):

3. STRUCTURE AND CHARACTERISTICS OF THE INDUSTRY

Marine Fisheries

Polish marine fishery has historically comprised three main sector: (i) boat fisheries (coastal) operating in inshore territorial waters and the Vistula and Szczecin lagoons; (ii) cutter fishery operating exclusively on the Baltic Sea; and (iii) deep-sea factory trawler fishery in distant waters beyond the Polish EEZ.

Boat fishery in Poland is considered artisanal, operating in inshore waters (<12 n.mi.) using vessels of up to 15 m LOA. At the end of 2005, 723 such boats were registered, of which about 36 were rowing boats, with some 1600 active fishers; one-third of them had income-generating jobs in addition to fishing, such as tourism services. The total catch from coastal fishery amounted in 2005 to about 15 000 t, of which 28 percent was cod, 27 percent flatfish and 22 percent herring, and the remaining species were freshwater and diadromous species. The average boat age is less than the cutter fleet, at about 22 years; around 60 percent of the boats were built after 1980.

Cutter fishery employed about 1300 people in 2005, working 249 vessels with total engine power of 62.8 MW (250 kW average), and size ranging from 15 to 30 m LOA. They are mainly based in the ports of Wladyslawowo (60 units), Kolobrzeg (36), Darlowo (25) and Ustka (33). Between 2004 and 2005 the fleet experienced significant capacity reduction: the number of vessels decreased by 40 percent and power by 34 percent as a consequence of a decommissioning programme following Poland’s accession to the EU in 2004. In 2005, the average cutter was 37 years old and there were no vessels younger than 10 years. The Baltic cutters are usually equipped with various fishing gear: gillnets, hooks, and pelagic and bottom trawls. Active gears (trawling) are the most common. In 2005, the cutters fleet landed 109 000 t, 88 percent of total Polish catches. Small pelagic species (sprat and herring) dominated, accounting for 68 percent and 17 percent respectively. Value of fish landed was US$ 35 million. The most economically important fish species landed by the cutter fleet was cod, representing about 11 percent of total catch weight and about 40 percent of landing value.

The high-seas fleet, which at its peak comprised 150 vessels harvesting over 600 000 t/yr, gradually lost economic importance after introduction of EEZs. At the end of 2006, there were only 3 vessels belonging to private companies and one state-owned vessel engaged in distant-water fisheries under the Polish flag. Of three state-owned enterprises—Dalmor SA, Gryf and Odra—nowadays only Dalmor remains active, with three vessels, of which two operate under the Maltese flag. In 2005, high-seas catches amounted to 6 426 t only—a significant decrease from the 320 000 t caught in 1990.

The distant-water fishing fleet operates in the fishing grounds of the northeast Atlantic (groundfish fishery), northwest Atlantic (shrimp fishery), Atlantic Antarctic (krill fishery) and to a small extent in the Namibian fishing grounds. Krill, following by redfish, herring, cod and saithe, are the main catches. All fish are landed in foreign ports.

In 2004, the first producer organization (North Atlantic Producers’Organization) in the meaning of EU regulation was created by two private deep-sea companies.

Inland fisheries and aquaculture

Traditionally, inland fishery in Poland comprises fish farming and fish breeding (aquaculture) and freshwater capture fishery (commercial capture fishery and recreational fishing). The volume and value input in the whole fishery sector grows steadily. In 2005, production of freshwater species from inland fisheries amounted to 55 000 t, of which 36 000 t was from aquaculture, 3 000 t from professional catches from lakes and 16 000 t from recreational fisheries (anglers’ catches).

600 000 ha of Polish rivers, lakes and freshwater reservoirs are used for capture and recreational inland fishery. The inland fishery efficiency is determined by inland water natural productivity. Aquaculture in Poland is based on breeding freshwater stenothermal or non-stenothermal fish in fish ponds located throughout the country. Two fish species account for most of the domestic fish pond crop: carp, with annual production of ca. 18 000 t (2005), and rainbow trout, at 15 700 t (2005). There are 400–500 farms engaged in fish production. Total value of aquaculture of carp and trout is estimated to be around US$ 78 million.

Utilization of the catch

Due to lack of fishmeal-production facilities, a substantial part of the fish caught is for direct human consumption. In 2005, about 30 000 t of fish (mainly sprats) was exported to Denmark for reduction to fishmeal, and another 95 000 t was landed for human consumption purposes.

Catch of the high-seas fleet is processed on board and exported as fillets, frozen fish and fishmeal to EU and Japan markets. Baltic catches are landed mainly in domestic harbours and sold whole fresh or gutted to fish processing enterprises.

The fish-processing subsector includes two types of business: preliminary processing, i.e. separating of raw material's edible parts; and proper processing – processing into highly processed products like canned, marinated, smoked, salted and others. In terms of financial outcome, fish processing is currently very important for the whole Polish fish sector. For a few years, it has seen the highest growth rate in the food industry. It is estimated that the total output of the fish processing sector exceeded US$ 1 billion in 2005.

As the Main Veterinary Inspectorate reports, 200 fish processing establishments were registered for EU trade at the end of 2006. The territorial spread of the processing plants is unequal. Most of the processing plants (64 percent), employing 69 percent of employees, are located in five coastal subregions, in two voivodships (Pomorskie and Zachodniopomorskie), while 17 percent of processing plants, employing 19 percent of employees, were located in other subregions, including the lake districts zone, in the voivodships of Warmińsko-Mazurskie, Kujawsko-Pomorskie and Wielkopolskie.

The main fish species processed in Poland is herring (33 percent of raw material delivery). Whitefish (cod, Alaska pollock, other) was in second place (30 percent of raw material delivery) and sprat third at 14 percent of raw material. The Polish fish processing subsector uses more and more imported raw material. This results from the limited access of the Polish fleet to fish stocks, poor technical quality of Baltic raw fish material, as well as a consequence of foreign trade liberalization in the early 1990s. Mostly, the raw material and semi-products imported (fillets, flaps, etc.) are of pelagic fish such as herring and mackerel. In 2005, Poland imported 88 000 t of herring products (136 000 t live weight equivalent), which exceeded several times own-catch supplies. The salmon trade has experienced a spectacular growth in recent years. During 2003–2005, the volume of fresh salmon imports to Poland doubled and amounted to 42 000 t. Most salmon raw material is processed into smoked, high-value, products and exported to the German, Danish and French. In 2005, Poland supplied 80 percent of all smoked salmon products for the German market.

Total output of fish processing companies amounted to 342 000 t in 2005, and it is estimated that in 2006 it may exceed 370 000 t. Marinated products dominate, at 20 percent, followed by frozen and fresh fillets (17 percent), canned fish (17 percent) and smoked products (15 percent). In 2005, 207 000 t of fish and fish products were exported from Poland, mainly to Germany and Denmark.

State of the industry

The state of the Baltic fisheries depends strongly on available fishing quotas established annually by the European Commission. Due to poor stocks, the TAC for cod has been reduced to a very low level, primarily affecting the demersal and small cutter fleets. The industry has experienced severe reduction in fleet number and capacity. Under the 2004 decommissioning programme, 40 percent of fleet capacity has been withdrawn and the number of units reduced by over 360 vessels. A smaller fleet led to higher individual quotas for those vessels remaining in fisheries, but nevertheless it was not enough to assure economically viable operations. This has led to a high level of IUU fisheries in the Baltic cod fisheries and is estimated by various bodies (ICES, Greenpeace, European Commission) to be 40–50 percent of total landings. At the same time, Poland underutilizes its quotas for pelagic species (sprat and herring), with about 50 percent of available quotas remaining uncaught. In contrast to the cod fisheries, this is caused by low profitability of pelagic catches due to low fish prices, strong competition from imported raw material, poor market structure and—last but not least—rapid increases in fuel prices. Another weakness of the industry is the high average age of vessels and limited possibility for fleet renewal. Since accession to the EU, new vessels can only be built if replacing an old one of similar or bigger capacity that has been withdrawn (entry-exit scheme).

In contrary to the capture fisheries sector, the post-harvesting industry is experiencing balanced development and investment. The 2006 estimate for value of production is 60 percent higher than fish processing output in 2003. In 2006, compared to 2003, investments in fish processing plants grew three times, exceeding US$ 50 million. This was possible mainly due to EU subsidies available from FIFG (Financial Instrument for Fisheries Guidance) funds. Fish processing companies have expanded their production facilities and product variety. The range of fish processing products offered on the Polish market has changed significantly in the last decade. Polish enterprises are in a process of concentration, coupled with increasing capital flow from abroad due to the still-competitive labour costs in Poland compared with Western Europe.

Economic role of the industry

From the perspective of the national economy, the marine harvesting sector is of very marginal importance. Its share in national GDP is almost negligible. Employment in the fishery sector is only a small fraction of total employment in Poland. However, in coastal regions, fisheries dependant areas, fishery and associated activities (such as processing, harbour services, trade, net repairs, etc.) make a significant contribution to the local economy. The profitability of the marine fishery sector is at a low level that limits larger investments in vessel modernization or building of new units.

The fish-processing sector is experiencing rapid development following accession to the EU in 2004. Two main factors are influencing this development: full liberalization of trade among the EU15 (now EU25) countries, mainly Germany (the biggest trade partner); and availability of FIFG structural funds. By December 2006, fish processors had submitted 170 investment applications for EU funds, equal to US$ 80 million (7 percent of their annual turnover).

The EU market has strengthened its position as a major consumer of fish exported or re-exported from Poland. In 2005, the EU25 countries imported 160 000 t of fish products from Poland, worth US$ 568 million, compared to 122 000 t worth US$ 270 million traded in the year before accession (2003). At the same time, imported fish were an important source of raw material for Polish processors. Poland’s position as a major importer of Norwegian and Icelandic fish raw material has strengthened considerably in past few years. The expanding production of the smoked salmon processing industry has increased, based almost entirely on Norwegian fresh fish.

4. DEVELOPMENT PROSPECTS

The development of Polish fisheries is closely linked to the EU Common Fisheries Policy. In 2004–2006, Poland benefited from structural assistance under the European Community structural FIFG fund. The National Development Programme for Poland 2004–2006 focused in principle on fishing fleet adjustment measures and investments in the fish processing sector. In 2006, a new Polish Development Plan and National Strategy for Fisheries Development were elaborated for 2007–2013. Major restructuring efforts will have to be made in order to improve the competitiveness of the sector. Poland will attempt to reach targets in the areas of:

• achieving a lasting balance between the fish stocks and their exploitation;

• strengthening sectoral competitiveness and developing economically viable businesses, market development, improvement of product quality and technological modernisation; and

• support to the economic development of regions dependent on fisheries and provision of measures helping to alleviate the social costs of restructuring with respect to fishermen.

It is envisaged to spend, in the form of assistance from the new European Fisheries Fund (EFF, that replaces FIFG), € 734 million (US$ 921 million) in 2007–2013, of which 30 percent will be devoted to investments in the fish-processing sector, 11 percent for stopping fishing activity, and 8 percent for investments on fishing boards.

The main areas of assistance specified in Poland’s 2007–2013 Development Plan are:

• adjustment of fish production in line with the state of resources and modernization of the fleet (public aid for owners of fishing vessels and fishers affected by fishery permanent or temporary effort adjustment plans; financing of equipment and the modernization of fishing vessels; improvement of safety on board, working conditions, hygiene, product quality, energy efficiency and selectivity);

• investments in inland fisheries, aquaculture and fish-processing development (support for traditional aquaculture activities important for preserving and developing both the economic and social fabric and the environment; promoting diversification towards new species and production species with good market prospects; investments for the construction, extension, equipping and modernization of inland fishing facilities; producing or marketing new products; applying new technologies or developing innovative production methods; and producing high quality products for niche markets);

• measures of common interest (collective actions; protection and development of aquatic fauna and flora; fishing ports, landing sites and shelters; development of new markets and promotional campaigns; modification for reassignment of fishing vessels; and

• sustainable development of fisheries-dependant areas (in order to maintain the economic and social prosperity of these areas, promote the quality of the coastal environment; and promote national and transactional cooperation between fisheries areas).

5. FISHERIES MANAGEMENT AND POLICY AIM

The Ministry of Agriculture and Rural Development and the Department of Fisheries in the ministry are the competent bodies for fisheries management in Poland. The three Regional Inspectorates of Fisheries, located in Szczecin, Slupsk and Gdynia, are responsible for management, monitoring and surveillance of fisheries at territorial level. Established in 2004, the Fisheries Monitoring Centre in Gdynia is responsible for operating the VMS (Vessel Monitoring System) and fisheries reporting system (catch and landings reports).

The main goal of Polish fishery policy is to keep a sustainable presence of fish industry in the national economy through improvement in its effectiveness, competitiveness and rational exploitation of living marine resources. More detailed aims formulated in the National Strategic Plan 2007–2013 are:

• to maintain or increase the level of employment in the industry;

• to achieve a sustainable balance between fishing effort and available fishing resources;

• to restructure, renew and modernize the fishing fleet, and fleet adjustment;

• to promote stable functioning of coastal fisheries in micro-communities;

• to develop aquaculture in line with Common Fisheries Policy principles and to integrate aquaculture with rural development programmes;

• to develop fish markets and fish marketing through increased fish consumption;

• to provide socio-economic support, including premiums for fishermen affected by the decommissioning programme; and

• to enhance competitiveness in the fish-processing industry.

Since 1 May 2004, when Poland joined the EU, its resource management policies have been harmonized with the Common Fisheries Policy (CFP) and Poland has been represented by the European Commission in international fisheries organizations (i.e. NEAFC, NAFO, CCAMLR), through which management and quota allocations are decided.

Particular attention in fisheries management in Poland is given to the cod fisheries, as cod stocks are considered to be in the worst condition of all national-waters stocks. A number of technical measures relating to the cod fisheries are in force in the Baltic Sea. These measures include minimum mesh size, minimum landing size, closed areas and seasons (aimed at limiting fishing effort as well as protecting juveniles), and gear-specific measures to enhance selectivity in the fisheries. Especially the introduction of the Bacoma trawl in 2004 (diamond-meshed trawl with a square-meshed window in the cod end) has been considered as a major factor in reducing catches of juvenile cod. Since 2005, for the first time, the Baltic cod quota has been split between the western and eastern parts of the Baltic in order to enable setting appropriate measures that could be applied individually to one or other cod stock. Cod, as well as other economically important species (sprat, herring and salmon), has been managed through a TAC system for many years. Individual cod quotas are allocated to fishermen on the basis of vessel size (length category). There are no ITQ system in Polish fisheries; however, it is allowable to make some quota exchange between vessels on a non-commercial basis.

The European Commission is working now on a new management plan for cod, which, according to the Commission, will address the main weaknesses of the current plan (developed by the former IBSFC), notably the poor scientific advice on catch forecasts and the failure of the TAC and quota system to reduce fishing mortality to sustainable levels. It is envisaged that the plan will define management targets for the two cod stocks, revise harvest rules and measures limiting fishing effort. The plan should also include additional control measures to ensure efficient enforcement of the management measures.

The intention of the future cod management plan is to tighten harvest control rules based on fishing days limitations. The other control measures that has been or will be implemented for better protection of cod population are:

• obligation of cod landings in designated ports;

• requirement that any quantity of cod caught is weighed in the presence of controllers when first landed, before being transported;

• requirement of information on the identity of the vessel, the port of landing, the estimated arrival time and the quantity of cod on board to be landed subject to certain quantity and vessel conditions; and

• obligation of notification of entry into or exit from specific areas.

6. RESEARCH

There are two scientific institutes in Poland that carry out fishery research.

The Sea Fisheries Institute in Gdynia (SFI), founded in 1921 in order to carry out research in sea hydrology and biology for the needs of fisheries, is the oldest marine research institution in Poland. The SFI belongs to a group of fisheries research institutions supervised by the Ministry of Agriculture and Rural Development. The principal areas of research at the Institute include fishery biology, oceanography, marine ecology, fish processing technologies, and fishery economics. The main task of SFI is to develop and provide scientific foundations for the rational use and exploitation of living marine resources. Research carried out by the institute forms the basis for establishing catch quotas and contributes to developing the European Research Area. The SFI owns a research vessel, the Baltica, which is a 41 m stern trawler. International cooperation within the International Council for the Exploration of the Sea (ICES) and the UE's Common Fisheries Policy (CFP) is of great importance for SFI activity. The Institute participates also in a number of international research projects.

The Inland Fisheries Institute was founded in 1951. The mission of the Institute is to carry out research in the fields of fish farming and to further developments in inland fisheries. It is also charged with the tasks of disseminating information, implementing, normalizing and unifying work in these areas. The focus and range of work carried out at the Institute include research and development projects and scientific research focused on determining a natural basis to optimize fish production methods; breeding, rearing and acclimatizing fish; fishing techniques; and fisheries economics. Other tasks include collecting, processing and disseminating the results of scientific research and taking part in transferring them to practice; improving methods of carrying out both research and development and scientific research projects; activities related to training, information regarding scientific, technical and economic matters and inventions; developing analytical and evaluative methods for the state and development of inland fisheries; cooperation with theme-based problem committees for standardization in order to implement standardizing projects; and evaluating and providing opinions of rationalization projects.

Marine research is also carried out by the Faculty of Marine Fisheries at the Agricultural Academy in Szczecin, and at the Maritime University in Szczecin, which trains sea-going personnel in fisheries and also offers post-graduate and specialist training and conducts scientific research. The Institute of Oceanography of the Polish Academy of Sciences in Sopot and Marine Biology Centre of Polish Academy of Sciences in Gdynia carried out studies on the marine environment, ecosystems and on marine organisms biochemistry and genetics.

7. AID

FIFG was the main source of financial aid available for the fisheries industry in recent years. In 2004–2006, over US$ 100 million was paid to the industry, mainly as a premium for decommissioned vessels, and US$ 16 million as socio-economic premiums for fishermen affected by the decommissioning programme. The total amount of assistance envisaged for 2004–2006 financial support under FIFG programme equalled about US$ 350 million, for the fish processing industry, fishing harbour facilities and aquaculture.

Other direct or indirect forms of financial assistance provided for the sector are:

• cheaper fuel for fishermen (no VAT);

• financing of salmon and trout smolt introduction into Baltic Sea waters; and

• subsidizing introduction of other fish species and production of fish stocks in the inland fishery sector.

8. GENERAL LEGAL FRAMEWORKS

Accession of Poland to the EU resulted in the full harmonization of Polish legal regulations for fisheries with the EU legislation.

The most important national regulation on fisheries are:

• Law on Sea Fisheries from 19 February 2004 (The Official Journal of Laws of the Polish Republic No. 62, item 574 of 2004) - basic national legal regulation.

• Regulation of 20 July 2004 on minimum fish sizes and closed seasons – the detailed conditions for carrying out fisheries activities (The Official Journal of Laws of the Republic of Poland of 2004, No. 172, item 1806);

• Law on Organization of Fishery market and financial support for fishery trade (The Official Journal of Laws of the Polish Republic No. 34, item 291 of 2004); and

• Regulation of 11 August 2004 on the Sectoral Operational Programme “Fisheries and fish processing 2004–2006” (The Official Journal of Laws of the Polish Republic No. 197, item 2027 of 2004).

The most important EU regulation on fisheries are:

• Council Regulation (EC) No 2371/2002 of 20 December 2002 on the conservation and sustainable exploitation of fisheries resources under the Common Fisheries Policy.

• Council Regulation (EEC) No 2847/93 of 12 October 1993 establishing a control system applicable to the common fisheries policy.

• Council Regulation (EC) No 2187/2005 of 21 December 2005 for the conservation of fishery resources through technical measures in the Baltic Sea, the Belts and the Sound.

• Council Regulation (EC) No 1198/2006 of 27 July 2006 on the European Fisheries Fund.

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