PERU - Industry
CEO, Pesquera Exalmar
Rossana Ortiz Rodriguez is an accountant and a CPA. He formerly worked for Arthur Anderson & Co., and has two decades of experience in the fishmeal sector. As the CEO of Pesquera Exalmar he has developed two business lines in the aquaculture industry and the fishmeal sector.
Peru’s fishing industry is successful because of our geography. We benefit from both El Niño and the Humboldt Current, which provide the environment required to grow a wide variety of species. Our most important species is the anchovy—Peru has an abundance of anchovies that contributes to the country’s status as a leading exporter of fish protein. Our other main commodities are giant squid, mahi-mahi, and scallops.
The fishmeal sector exports around $2 billion per year, and the frozen market exports around $1.3 billion. The sector is relatively young in terms of the private investment because, as in most Latin American countries, industry has historically been owned by the public sector. Privatization began in 1991, and we were the first company that invested after investment laws changed in favor of the private sector. When Peru became more open, credible, and reliable, markets opened for all companies operating in the sector and most investments came in during 2000. Most of the companies that came in were Norwegian, Chinese, and Brazilian.
Our company adapts to the opportunities available. In 2007, we opened up to private equity investment, and after that we launched an IPO on the international capital markets. In 2013 we offered bonds and made syndicates around the world with international banks. We met with capital markets and financial markets in Peru. Financial structure is crucial in this sector. During El Niño, production ceases and it is only possible to survive as a healthy company with a strong financial structure. When El Niño passes we recover quickly.
It was a very slow year. El Niño is our strength but is also a weakness. When El Niño is hotter—as it was in 2015—the biomass of anchovy does not disappear or migrate, it just disperses or moves deeper, and it is therefore very difficult to catch the fish. El Niño does not kill the fish. The biomass is comprised of non-migrating fish; it is a stationary form along our coast that survives a certain temperature. When El Niño brings hot water, the fish go deeper looking for colder water. The current only comes in specific areas of the sea, which is why the fish disperse and are very hard to catch, although they do not disappear.
We have the wild catch species that provides a great opportunity to add value. Most companies in Peru began with frozen young squid, but we are currently introducing higher value products like seafood mix that we export to Italy, the US, and Spain. We are currently developing hamburgers from young squid to sell in Peru. We promote health and good protein in many of our products. We have invested $50 million in frozen processing plants. We have six plants for fishmeal, two frozen plants, and 22 vessels in operation. We are the third-biggest producer and exporter of fishmeal and fish oil with a 13% share in the market.
We have been present in the fishmeal and fish oil sector for many years, which is why all of our efforts are currently in the frozen sector. We export the raw material to China, but needed to improve our products to export to the US. We are making all possible efforts to increase our participation in US export market, which is why we are promoting this new brand. The US and Europe are our targets. Last year, 65% of our exports went to China and now we want to diversify. We made our incursion in the US market in Boston, and in Europe it is France, Spain, and Italy. We are trying to go to Dubai by sending samples of our products, and we want to sell directly to the markets there.
These agreements facilitate our business in Asia—Vietnam and Thailand are our natural clients and right now we are doing business with Thailand through Tesco. In Japan we are opening markets for frozen, and we are already open in fishmeal.
The main goal is to recover our level of production in fishmeal and fish oil. Last season was a very good season and makes 2016 look promising. We recovered our level of production and we increased our exports of frozen fish internationally and locally. To add value is also our constant target.
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