Acipenseridae. Introduction

1.

ACIPENSERIDAE
Alisher Abu, Ecfuc-21, 2023-08-12

2.

Introduction
Relevance of the Project: The Caspian Sea, a nexus of Eurasian trade
and history, is renowned for its sturgeon population, the source of the
world's finest caviar. Yet, this precious resource is under threat;
overfishing has pushed sturgeon to the brink of extinction, leaving a
gaping void in the global caviar market.
Objective of the Project: This project envisions the establishment of a
sustainable sturgeon farm in proximity to the Caspian Sea. By marrying
age-old wisdom with contemporary aquaculture practices, we aim to
bolster sturgeon numbers and provide a consistent, high-quality caviar
supply to the European market.
Overview: We will detail a comprehensive business model for the
breeding and restoration of the sturgeon species, encompassing every
stage from site selection, infrastructure setup, to the breeding process,
and eventual harvesting, processing, and exportation.
Commitment: Join us in this endeavor as we delve into the complexity
of sturgeon farming, seeking a synergy between environmental
stewardship and economic gain

3.

Executive Summary
Vision: Acipenseridae is on a mission to redefine sturgeon farming, creating a
sustainable and profitable business model. Positioned near the Caspian Sea's
vibrant but delicate ecosystem, our goal is to regenerate the diminishing
sturgeon population while fulfilling the global demand for premium sturgeon
products.
Opportunity: The international market for sturgeon, especially caviar, is
expanding, despite environmental challenges. Our advantageous location
allows us to capitalize on this growth by providing sustainably sourced caviar,
thus serving market demands and aiding in the preservation of the sturgeon
species.
Sustainability: Our farming practices are designed to be environmentally
responsible, employing methods that ensure the well-being of the sturgeon
population and the ecological health of the Caspian Sea region.
Financial Outlook: The financial structure of Acipenseridae is projected to
yield significant returns. With a business model crafted to maximize
profitability, we anticipate strong growth, with a break-even point expected
within a feasible period, underscoring our project's economic potential.
By supporting Acipenseridae, stakeholders engage in a venture that offers
economic rewards and contributes to an ecologically sustainable future.

4.

Business describtion

5.

Business Description
Sector and Focus:
Industry: Aquaculture, with a specialization in sturgeon farming.
Primary Products: Sturgeon meat and caviar.
Legal Compliance:
Fauna Protection Laws: Includes the 1993 and 2004 laws focusing on
fish stock protection and CITES species trade regulations.
Government Regulations: Detailing the management of fish industries
and tender processes, adhering to Kazakhstan's ecological codes.

6.

Business
Description
Sturgeon Varieties and Caviar Spawning Ages:
Beluga Sturgeon (Huso huso): Largest species, caviar spawning age: 20-25
years.
Siberian Sturgeon (Acipenser baerii): Medium size, caviar spawning age: 7-10
years.
Sterlet Sturgeon (Acipenser ruthenus): Small, caviar spawning age: 4-5 years.
Russian Sturgeon (Acipenser gueldenstaedtii): Up to 2 meters, caviar spawning
age: 8-12 years.
Sevruga Sturgeon (Acipenser stellatus): Around 1.2 meters, caviar spawning
age: 7-8 years.
Lake Sturgeon (Acipenser fulvescens): Can grow to 2.5 meters, caviar spawning
age: 14-33 years.

7.

Strategic Insights:
Benchmarking: Learning from established
farms such as "Karaganda - Sturgeon,"
"Kazakh - Osetr," and "Royal Fish."
Biotechnological Approach: Emphasizing
the importance of genetic diversity in
broodstock for sustainability.
Species Management: Focusing on
balanced species composition and seeking
state support for long-term profitability.

8.

Market Analysis
Kazakhstan Market:
• Demand Trends: Growth in sturgeon and caviar
consumption in 2021, rebounding after a decline,
indicating resilient consumer demand.
• Market Size: Notable increase in caviar market
value in 2021, with a history of growth, particularly
in 2017, suggesting a significant market size.
• Competitors: Key import suppliers to Kazakhstan
include China, Russia, and Kyrgyzstan,
representing the primary competition.

9.

European Union
(EU) Market:
Demand Trends: Consistent increase in
sturgeon consumption over the years, with a
slight dip in 2021, showing a strong and
growing demand.
Market Size: The EU market experienced five
years of growth, with a minor decrease in
2021, indicating a large market size.
Competitors: Major sturgeon exporters in the
EU include Italy, Lithuania, the Netherlands,
Poland, France, Germany, Latvia, Denmark,
and Spain. Italy, France, and Germany lead in
export values, highlighting them as significant
competitors.

10.

Marketing Strategies
Kazakhstan Market:
Growth in Demand: Increased consumption of sturgeon and caviar in recent
years.
Pricing Strategy:
• Black caviar: approx. 200 euro per 250g.
• Sterlet caviar: approx. 170 euro per 200g.
• Hybrid sturgeon caviar: approx. 100 euro per 100g.
• Fresh sturgeon meat: approx. 12 euro per kilo.
• Smoked sturgeon: approx. 10 euro per kilo.
• Sturgeon fillets: approx. 15 euro per kilo.
Local Marketing Approaches:
• Leveraging cultural connections and traditions.
• Educational campaigns on sustainable sturgeon farming.
• Utilizing social media for brand awareness.
• Collaborations with local restaurants and influencers.
• Participation in local events and food expos.

11.

European Union (EU) Market:
Market Characteristics: A strong and growing demand for
sturgeon products.
Pricing Influencers: Transportation costs, VAT and import
duties, regulatory compliance, specialized packaging, and market
premium for luxury products.
Approximate Pricing in EU:
Black caviar: 250-300 euro per 250g.
Sterlet caviar: 220-270 euro per 200g.
Hybrid sturgeon caviar: 130-180 euro per 100g.
(Fresh sturgeon meat: approx. 30 euro per kilo.
Smoked sturgeon: approx. 25 euro per kilo.
Sturgeon fillets: approx. 28 euro per kilo.
EU Marketing Strategies:
Highlighting sustainability credentials.
Digital marketing and e-commerce initiatives.
Tailored social media campaigns for European
audiences.
Networking with European seafood distributors.
Cultural adaptation of marketing messages.

12.

Operations

13.

Location: Atyrau Region,
Kazakhstan
• Proximity to the Caspian Sea: Ideal for sourcing
water and native sturgeon species.
• Environmental Conditions: Favorable climate and
water quality for sturgeon farming.
• Accessibility: Strategic location for local and
international trade, particularly for EU exports.
• Local Expertise: Availability of regional
aquaculture skills and labor.

14.

Facilities and
Equipment
Land and Water Bodies: Adequate land with access to clean water, including ponds or tank
systems for various sturgeon growth stages.
Hatchery Equipment: Incubators, larval tanks, and feeding systems for breeding and nurturing
juvenile sturgeon.
Grow-out Systems: Larger tanks or ponds for growing sturgeon to market size.
Feed and Nutrition Systems: Tailored, high-quality feed for sturgeon's dietary needs.
Water Filtration and Aeration Systems: Ensuring optimal water quality and oxygen levels.
Health and Disease Management: Facilities for regular health checks and disease prevention.
Processing and Storage: Infrastructure for processing, packaging, and storing sturgeon meat and
caviar.
Office and Staff Facilities: Administrative and staff accommodation buildings.

15.

Budgeting and Costs (€2.7
Million Total Budget)
Land Acquisition: €252,000 for 200 hectares in Atyrau.
Construction and Infrastructure: Approx. €660,000 for
building ponds/tanks, water systems, and incubators, plus
€370,000 for equipment and €80,000 for automation.
Equipment Purchase: Included in construction and
infrastructure costs.
Initial Stock and Feed: Approx. €36,750 per year for 15
tonnes of meat production.
Operational Costs: Approx. €60,000 per year for staff
salaries, utilities, maintenance, etc.
Licenses and Permits: Approx. €13,125 annually for legal
and environmental permits.
Other Expenses: €100,000 for miscellaneous and unforeseen
expenses.

16.

Year 1-4 Financial
Overview:

17.

Overview
• The financial strategy is designed for success, with substantial returns on
investment anticipated.
• Forecasts indicate vigorous growth, with a break-even point expected within
a realistic timeframe.
• The approach integrates sustainability, aligning with market trends for
ethically and sustainably sourced products.
• Long-Term Investment Perspective: The project is designed as a long-term
investment. It requires patience and a strategic view, considering the
extensive initial setup period and the time needed to grow and harvest
sturgeon, which is inherent in aquaculture projects of this scale and nature.

18.

Year 1-4 Financial Overview
Year 1:
Revenue: €100,000
Expenses: €309,875
Net Income: -€209,875
Total Assets/Liabilities & Equity: €1,440,000
The NPV for a single year (Year 1) is the present value of that year's net cash flow. Sum up
the current values of each year's net cash flow for multiple years.
Net Cash Flow for Year 1: -€209,875 (Negative due to net loss)
Discount Rate: 10%
NPV (Year 1): NPV = Net Cash Flow / (1 + Discount Rate)^Year = -€209,875 / (1 + 0.10)^1 =
-€190,795

19.

Year 1-4 Financial Overview
Year 2:
Revenue: €300,000
Expenses: €330,000
Net Income: -€30,000
Total Assets/Liabilities & Equity: €1,485,000
NPV Calculation for Year 2
Net Cash Flow for Year 2: -€30,000 (Improved but still negative)
Discount Rate: 10%
NPV (Year 2): NPV = Net Cash Flow / (1 + Discount Rate)^Year = -€30,000 / (1 + 0.10)^2 ≈ €24,793
Liabilities & Equity: €1,485,000

20.

Year 1-4 Financial Overview
Year 3:
• Revenue: €500,000
• Expenses: €450,000
• Net Income: €50,000
• Total Assets/Liabilities & Equity: €1,560,000
• NPV Calculation for Year 3
• Net Cash Flow for Year 3: €50,000 (Positive cash flow)
• Discount Rate: 10%
• NPV (Year 3): NPV = €50,000 / (1 + 0.10)^3 ≈ €37,507

21.

Year 1-4 Financial Overview
• Year 4:
• Revenue: €600,000
• Expenses: €500,000
• Net Income: €100,000
• Total Assets/Liabilities & Equity: €1,560,000
• NPV Calculation for Year 4
• Net Cash Flow for Year 4: €100,000 (Positive cash flow)
• Discount Rate: 10%
• NPV (Year 4): NPV = €100,000 / (1 + 0.10)^4 ≈ €68,301

22.

Key Financial Metrics
• The project is expected to experience initial losses in
Years 1 and 2, with profitability beginning in Year 3 and
strengthening in Year 4.
• The Net Present Value (NPV) improves each year, moving
from negative in Year 1 to positive by Year 4.
• Total assets and liabilities & equity show a steady
increase, indicating growth and investment in the
business.

23.

IRR
• Internal Rate of Return (IRR) for this project, based on the provided cash
flows, was approximately -56%. The project is fundamentally long-term in
nature. The financial projections suggest that it would take approximately
15 years to achieve an IRR of 0%.
• A 0% IRR over this timeframe implies that the project's net present value
(NPV) will be zero, meaning the project is expected to just break even with
its initial investment after 15 years.

24.

Risk Analysis

25.

Environmental
Risks:
Impact on Local Ecosystems:
• Likelihood: Moderate
• Risks: Escape of farmed sturgeon
altering genetic pool, pollution from feed
and waste.
• Management: Robust containment
systems, sustainable feed sources,
regular water quality monitoring.
Climate Change and Natural Disasters:
• Likelihood: High
• Risks: Vulnerability to climate change
effects, rising sea levels, increased
salinity, extreme weather.
• Management: Resilient infrastructure,
comprehensive insurance, emergency
response plans.

26.

Operational Risks:
• Production Challenges:
Likelihood: High
Risks: Maintaining water conditions, fish health,
disease outbreaks.
Management: Advanced aquaculture technology,
staff training, rapid response protocols.
• Technological Failures:
Likelihood: Moderate
Risks: Equipment failure, power outages, cyber
threats.
Management: Regular maintenance, backup power
solutions, strengthened cybersecurity.

27.

Legal and Regulatory
Risks
• Changes in Regulations:
Likelihood: Moderate
Risks: Evolving environmental, animal welfare, food
safety regulations.
Management: Keeping up with regulatory changes,
flexibility in operations.
• Intellectual Property Issues:
Likelihood: Low
Risks: Disputes over proprietary techniques or
technologies.
Management: Thorough due diligence, legal counsel,
ethical business practices.

28.

Product Design &
Packaging

29.

Design Philosophy:
Elegance, Functionality, and Environmental Responsibility:
The Acipenseridae project adopts a design philosophy that
balances aesthetic appeal with practicality and ecological
consciousness. The goal is to create packaging that not only
maintains product quality and freshness but also aligns with
the project's commitment to sustainability.
Materials and Techniques:
Degradable and Recyclable Materials: Packaging materials are
chosen for their low environmental impact, prioritizing
biodegradable, recyclable, or compostable options.
Innovative Preservation Techniques: Incorporation of advanced
preservation methods like vacuum-sealed packaging and
temperature-controlled materials to extend shelf life without
compromising quality.
Minimalistic Design: The packaging design is minimalistic yet
elegant, emphasizing the brand's luxury and quality.

30.

Branding and
Aesthetics and
Customer Experience
Consistent Branding: All packaging
maintains brand consistency with color
schemes, logos, and typography that reflect
quality and sustainability.
Informative Labeling: Each package
includes clear labels detailing product
information, nutritional content,
sustainable sourcing practices, and disposal
or recycling instructions.
Engaging Unboxing Experience: The
packaging is designed to create a delightful
unboxing experience, featuring personalized
elements and digital links to the project's
sustainability mission.
Adaptability to Market Segments: The
packaging caters to diverse market
segments, ranging from premium, giftworthy options to more practical designs for
a wider consumer base.

31.

Graphs

32.

IRR
Graph

33.

Legal Structure

34.

Business Forms in Kazakhstan:
• Peasant Economy: Recognized for family entrepreneurship and based on
common joint property.
• Personal Entrepreneurship: Establishment of a farm centered on
personal entrepreneurship is permitted.
• Partnership: Forming a farm as a partnership through a cooperation
agreement is acknowledged.
• Establishment and Leadership: A farm is established following state
registration of land parcel rights and, in some cases, after registration as an
individual entrepreneur. Any capable Kazakhstani citizen aged 18 or above
can lead such a farm

35.

Licenses and Permits
Regulations and Procedures: For operating a sturgeon farm in
Kazakhstan and trading sturgeon caviar, specific regulations and procedures
must be followed as per the Order of the Minister of Agriculture of
Kazakhstan dated January 14, 2015, No. 18-04/14.
Issuing Marks for Sturgeon Caviar: The government service for issuing
marks for sturgeon caviar for trading in the domestic market is carried out
by the Committee of Fisheries of the Ministry of Ecology, Geology, and
Natural Resources of Kazakhstan.
Application Process: To obtain this service, an application is required
with relevant documents depending on the type of caviar (natural,
confiscated, or artificial).
Compliance with CITES: Information about state registration and
permission for the import, export, or re-export of animal species under the
CITES convention is necessary.

36.

Conclusions

37.

Strengths of the Business Plan:
• Innovative and Sustainable Approach: The Acipenseridae project
presents a pioneering model in sturgeon farming, combining modern
aquaculture techniques with a strong commitment to environmental
sustainability.
• Strategic Location: Situated near the Caspian Sea, the project benefits
from ideal environmental conditions and access to native sturgeon species,
enhancing the operational feasibility and product authenticity.
• Market Potential: With robust demand in both domestic and EU markets,
the project is well-positioned to tap into the lucrative caviar industry while
also offering a range of sturgeon products.
• Comprehensive Risk Management: Detailed analysis and strategic
management plans are in place for environmental, market, operational,
legal, and safety risks, ensuring the project's resilience.

38.

Investment Decision:
• Personal Stance on Investment: Based on the analysis and financial
considerations, the decision is not to invest in the Acipenseridae project. The
primary reason is the significant magnitude of the initial investment
required.
• Alternative Investment Strategy: Instead, a more feasible approach is
suggested – investing in the already established company, Caspian Royal
Fish. This strategy circumvents the high costs and risks associated with
setting up a new farm.

39.

Q&A Session
Thank You for Your Attention
Open Floor for Questions