Multinational Monitor

DEC 2002
VOL 23 No. 12


Bad Apples in a Rotten System: The 10 Worst Corporations of 2002
by Russell Mokhiber and Robert Weissman

The Top 10 Financial Scams of the 2002 Corporate Crime Wave
by Lee Drutman and Charlie Cray


Caviar in Crisis: Luxury Food and Market Failure
an interview with
Inga Saffron


Behind the Lines

Corporate Crime Wave: The Response

The Front
Medicine Access in Dispute

The Lawrence Summers Memorial Award

Names In the News


Caviar in Crisis: Luxury Food and Market Failure

An Interview with Inga Saffron

Inga Saffron is the author of Caviar: The Strange History and Uncertain Future of the World's Most Coveted Delicacy. She has been a reporter for the Philadelphia Inquirer for 16 years and served as the newspaper's Moscow correspondent from 1994 to 1998.

Multinational Monitor: What is caviar?

Inga Saffron: Caviar is salted sturgeon eggs. Sometimes the word caviar is used to describe the salted eggs of other fish, like salmon or trout. I think it is fair to use the term caviar for any salted sturgeon or paddlefish roe.

MM: Where does caviar come from?

Saffron: Sturgeon exist throughout the Northern hemisphere. Caviar is really part of Russian culture, and it was Russian culture that sent caviar around the world. Most of the caviar today comes from the Caspian or the Black Sea, or the Amur River. But that is changing, as fish in those bodies of water become more threatened.

Caviar now comes from other places. There is a lot of sturgeon and paddlefish in the United States, and the United States is becoming an increasingly large producer of caviar, as it was in the nineteenth century.

MM: What is the life cycle of sturgeon?

Saffron: Sturgeon are an anadromous fish, which means they live in the seas, and commute up freshwater rivers to spawn. Sturgeon are born in rivers - in the Volga River, or the Ural River, or the Delaware River or the Sacramento River. After the female lays her eggs, they are fertilized by the male sturgeon with milt. Tiny inch-long fingerlings are born within a few hours. Those fingerlings make their way down the river into the sea, where they live until they grow up. When the fish are mature - and it takes quite a while for them to mature - they start the whole trip back up the river. They are famous for trying to spawn in the spot where they were born, repeating the cycle of their parents.

One of the reason the sturgeon is in so much trouble now is, unlike most fish, they take quite a long time to mature. Beluga can take 20 years before sexual maturity. Even some of the smaller sturgeon take six to 10 years to reach adulthood and lay their eggs. When they finally mature, they go up the river.

MM: Historically, where were the large populations of sturgeon outside of the Caspian?

Saffron: The whole Northern hemisphere was full of sturgeon. There were sturgeon in China, Canada, Europe, every East Coast river of the United States, in U.S. West Coast rivers, the Great Lakes, the Yangtze River of China, the Rhone, the Elbe, the Adriatic Sea, the Mediterranean. They were just everywhere.

They are very old fish. They were around at the time of the dinosaurs. When the dinosaurs went extinct, the sturgeon survived, probably because they were under water and not affected by the same climatic change as the land animals. They just kept swimming around the seas, and up the rivers when it was time to spawn. Nobody bothered them for a long time.

MM: But then people came along.

Saffron: It is said that human beings learned to fish around 10,000 years ago, but sturgeon were one of the last kinds of fish they learned to catch, because it is a trickier to catch them. It is believed that people did not master the technique for catching sturgeon until about 4,000 years ago. That's because you don't just throw a hook and a line into the water and hope to catch them. They don't snap at hooks.

MM: How do you catch them?

Saffron: Nowadays, they are caught with big nets. In the Volga, fishermen have huge nets - several hundred yards wide and 22 feet deep, wrapped around a spool. The spool is set on a little tug boat. As it chugs across the river, the spool unwinds, and the net is dropped across the river, forming an underwater fence. All fish swimming up the river to spawn swim into the net. The same tugboat brings the net around into a kind of noose, pulling the net in, until it is tight in a big ball, full of fish.

There is another method, which poachers use in Russia and Kazakhstan. They run a line across the river, with hundreds of hooks dangling from the line. The sturgeon swimming up river get snagged on this curtain of hooks.

MM: What happened to the large sturgeon populations in North America?

Saffron: There were loads of sturgeon in North America when the first Europeans arrived. But the Europeans thought the sturgeon was a disgusting fish, and they wanted nothing to do with it. The Indians caught and ate the sturgeon and the eggs, but the Europeans refused to eat it.

If the Europeans did catch a sturgeon by accident when they were fishing for something else, they would feed it to their pigs, or use it as fertilizer; maybe they would feed it to their slaves or servants. But white people just didn't eat sturgeon or caviar. They didn't know how to make the caviar, they didn't know the technique of salting it.

In 1873, some Germans who had started a caviar business in Europe, and had gotten Europeans to like caviar, came to the United States. They said to the American fishermen, "Don't throw out your sturgeon, give them to us for a dollar a fish." That was a lot of money. The fishermen saw the Germans make caviar, and saw how much money they were making. They started to copy the Germans, or they sold the fish to the Germans or to other entrepreneurs who came here, and there began an incredible frenzy of fishing.

Between 1873 and the early 1900s, people made tons of money. The fishermen would start along the Savannah River - the fish start spawning earlier in the South - and they would just go river by river up to the Delaware. They would catch every sturgeon that was going up river to spawn. They really destroyed the East Coast population of sturgeon, and then they moved to the Great Lakes, and did the same thing.

Then they moved to the West Coast. By that time, people understood the effect of this type of fishing. In the early part of the twentieth century, California enacted the first curbs on fishing. Eventually, the state banned fishing of sturgeon. It is still forbidden to catch sturgeon today, except for sport fishing.

The sturgeon are particularly vulnerable. When you catch a sturgeon migrating up river, you are not just catching that fish, you are preventing future fish from being born. You are catching them in their reproductive process. It is doubly harmful.

MM: What happened in California?

Saffron: The California Fish and Wildlife Service had seen what had happened on the East Coast and in the Great Lakes. There was also quite a bit of fishing in California and Washington and Oregon in the late nineteenth century. The California legislature recognized that if they had unchecked sturgeon fishing, they would have none left. They began introducing controls by around 1901, and made them stricter as time went on. There is a pretty decent population of white sturgeon in the Pacific - though not as great as it once was - because of those laws.

MM: When did the caviar industry start in Russia?

Saffron: It is hard to say exactly when. We know that in the eleventh century, the Russian Orthodox Church listed caviar as one of the foods that Russian Orthodox Christians could eat on days when they were not allowed to eat meat - which was something like 200 days a year. Caviar became one of the foods that Russians ate a lot. It was plentiful, it was religiously legal to eat on fast days, and so it became very much ingrained in Russian culture.

That was the eleventh century. I'm sure local people ate it before the eleventh century.

By the thirteenth century, Tatars, who lived in the South of Russia, were trading with the Venetians, and trying to sell them caviar.

The thing that kept caviar from becoming an international commodity was poor transportation. Until there were railroads, steam engines and ice for preservation, it was really hard to transport caviar over long distances. It would just spoil. If it took six months to get from the Crimea to Venice, it was very likely the caviar would not survive that trip, especially if the weather was hot.

MM: When did the modern industry start?

Saffron: It really was in the mid-nineteenth century. By the 1820s, the steamship was coming into use, and railroads were being extended. In 1856, there was a railroad built from Volgagrad across to the Don. You could take the caviar on a boat up the Volga, and maybe another river and transfer it to a railroad; it made for easy transportation to Europe. That was one aspect of it; because of improved transportation, manufactured ice and an understanding of preservation, caviar could be brought fresh to Europe.

In addition, the Industrial Revolution created a middle class, which had disposable income. They hungered after things which were new and exotic.

Trends intersected - better transportation and fresher product, and disposable income to spend on luxury goods. By the 1860s and 1870s, caviar was a craze in Europe, particularly in Germany.

At that time, the Germans were importing it from Russia. Then they realized they had sturgeon in their own rivers, and could make their own caviar. They made so much of it, they destroyed their population of sturgeon. That is what caused the German merchants to go to the United States, to seek new sources of caviar.

MM: How did the establishment of the Soviet Union affect the industry?

Saffron: There was the whole caviar craze that began in the mid nineteenth century, and grew and grew. The populations of sturgeon all over were crashing around the time of World War I. With World War I, everybody stopped fishing, because they went off to fight. That gave the sturgeon a break.

When the Soviets came to power, things were pretty disorganized, so the sturgeon recovered a little bit during that time.

The Soviets then realized they could make a lot of money if they controlled the caviar market. They began organizing the industry in a centralized way, like they did with a lot of industries. They wanted to export it, because they needed the hard currency. But they intentionally controlled the exports to make the caviar more valuable, and to increase its allure.

During a good part of the Soviet Union's existence, they limited the amount of fishing that could be done in the Caspian and the Black Sea, and they limited the amount of caviar that would be made and exported.

I don't want to say that they have a great environmental record, because they don't. But they did act as a brake on fishing because they limited caviar exports.

The Soviets built a series of dams on the Volga in the 1950s and 1960s, cutting off the sturgeon's spawning grounds. The sturgeon population started to crash again. The Soviets realized what was happening, and they began building hatcheries.

By the time the Soviet Union fell apart in 1991, a very large percentage of sturgeon was being born in hatcheries.

When the Soviet Union collapsed, so did that hatchery system. The hatcheries became much less efficient, they put back many fewer fish than they had before. That is part of the reason that there is a crisis today.

MM: Why did the hatchery system fall apart?

Saffron: When the Soviet Union collapsed, people stopped getting paid. The government had no money to pay them; everything was very disorganized and chaotic. Not only weren't the people who ran the hatcheries getting paid, but the hatcheries had no money to buy feed for the fish. They had no money to pay their electric bills, and service was cut off.

Russia was just in total collapse after 1991. Factories all across the country were used to getting their money for operating costs from the government, and they just shut down when the government stopped sending money. Suddenly there was no more government to pay their bills, and plenty of the factories went bankrupt. Hatcheries were just one type of factory that had no money to operate.

That is not the only cause of the current crisis in the Caspian.

At the same time, many of the people who had been thrown out of work began to fish illegally. They began to poach for sturgeon and make caviar in their kitchens, because that is the only way they could make money. It was the one resource in Southern Russia. That had a tremendous impact on the sturgeon as well.

All the rules that the Soviet Union had about when to fish were ignored, and people just fished all the time. They had no limits. That put a lot of pressure on the sturgeon population.

MM: Did Russia and the other former Soviet states make any effort to control the poaching?

Saffron: Their efforts were very nominal.

In Russia, the government knew that people were poaching, but it also knew that it couldn't pay people's salaries and that they would starve if it didn't let them poach. So the government looked the other way, because they thought they had no other choice.

Also, Russia was an incredibly corrupt place after the collapse of the Soviet Union. Caviar gangs - organized crime gangs - sprang up. They would bribe various enforcement officials. There was a famous incident where Russian federal police boarded a ship that had been poaching in the sea, and the local Daghestani police arrived, and they fought it out. The Daghestani police had been bribed, and they were protecting these poachers.

MM: Iran is a counter example to all of this?

Saffron: Iran is sort of like the Soviet Union used to be. It maintains centralized control, and operates very efficiently. The Iranians have hatcheries. They tag every fish they release into the sea. They have very strict controls over how many they catch. Because the fish are tagged, they know where they came from, how old they are. Because it is run by the state, and it is very lucrative, they don't permit any freelance fishing.

That has been good for their part of the Caspian. It is interesting that the Southern Caspian, where Iran is located, is not the best place for sturgeon. It is the Northern Caspian - the Russian and Kazakhstan portions - where there were once the greatest concentration of sturgeon. It is shallower and warmer, and was the real fertile area for sturgeon in the Caspian.

MM: Are there international efforts to save the sturgeon?

Saffron: In late 1997 and 1998, the Convention on International Trade in Endangered Species (CITES) began to implement controls on exports of caviar, basically limiting what could be exported from Russia, Iran or China. That has been modestly successful in controlling the exports and to a certain extent reducing the smuggling that was going on.

The U.S. Fish and Wildlife Service, which is the U.S. partner of CITES, has worked really hard to reduce smuggling into the United States. There was a New York dealer who was recently convicted in New York; and my suspicion is that he is going to be the last really big caviar criminal caught. That is not to say that people aren't going to smuggle a suitcase full of caviar, but it is becoming harder to run a really big systematic smuggling operation.

I think Europe has been less successful, because there you can bring caviar in overland, whereas in the United States customs can control the airports and thereby control smuggling.

The problem is that CITES does not control what is going on domestically in Russia and Kazakhstan. Although it is harder for Russians to export caviar than it was in 1997, it is no harder to fish for sturgeon than it was five years ago, because the Russian government does not enforce its own fishing laws. You can go to Moscow and find caviar selling incredibly cheaply - more cheaply today than 10 years ago.

MM: To what extent is pollution a part of the story of the decline of sturgeon in the Caspian?

Saffron: I think pollution is a big part of it. A couple years ago, a Russian scientist did an analysis of sturgeon eggs, and found that every single egg had some kind of deformity, which was probably the result of pollution. It makes the sturgeon less fertile, and the fingerling's survival rate is lower because of the pollution.

MM: To what extent are Russians writing caviar off in favor of oil?

Saffron: I think they have written off caviar. They believe the big money is in oil now. I don't think they are committed to saving the sturgeon. All of the effort at control has come from the outside, with the exception of individual Russian scientists. There are plenty of individual Russian scientists who are very committed and extremely worried, but they don't have the power.

MM: Is there any prospect of controls being put in place to save the sturgeon population?

Saffron: The United States is going to ban beluga by the end of the year, because it is the most vulnerable Caspian sturgeon species. So there will be no more beluga exports to the United States, which has been the largest consumer of beluga caviar. I don't know if other markets are going to take the catch that would normally go to the United States. I'm not very hopeful about the Caspian.

We've seen this pattern repeated over and over again. The Germans destroyed their population of sturgeon, the French destroyed theirs, the United States destroyed its population of sturgeon, always in a very short period of time. I don't see the Russians or the Kazakhs getting really serious.

There was a recent story about the Kazakhs starting a beluga farm, which I suppose is a good thing. They are going to farm beluga on land, which could give them an incentive to protect the fish remaining in the sea. I do think that, more and more, caviar farms will supply most of the delicacy in the future, though farming is still an experimental thing.

MM: If there was political will, what should be done?

Saffron: They could stop all beluga fishing. They could reduce the catches for sevruga and kaluga.

One really effective thing they could do is shorten the fishing season. The sturgeon swim up river at known times of year, the beluga in February, the ossetra in late April/May/June, the sevruga around the same time. What is happening now is the fishermen are fishing almost the whole time the sturgeon are swimming up river to spawn. If you cut that time in half, you'd give some a chance to spawn.

That would be really effective, perhaps along with some encouragement to the hatcheries, either with Russian government or international support, and more funding for scientists. I interviewed one of the most renowned sturgeon scientists in Russia; she didn't even have a computer to track the number of fish caught in different places.

I think the international community has to lay down the law to Russia, and say, "This is really important. You have this environmental resource, this strange prehistoric creature, and you shouldn't be squandering it." I don't know if they can be convinced, but I think it is worth a try.

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