After 34 years of operations, B.E.V Processors Inc will be closing the doors to its Fish and Shrimp Processing Plant at Houston next month and owner Bruce Vieira has cited market challenges, including the implementation of more rigorous certification requirements, as the major factors for his decision.
Vieira said while he has been in the fishing industry for more than 40 years, B.E.V began shrimp processing in 1984 and the first batch was shipped to the United States of America on October 31st the same year.
After shipping millions of pounds of processed shrimp every year since then, Vieira said that shuttering his business has been on his mind for more than three years.
However, he said he finally came to the decision due to the various challenges that lie ahead for the industry.
“Well, I basically see a lot of challenges ahead. One of the challenges is that there is a certification process called the MSC [Marine Stewardship Council] that requires the country to put a whole set of stuff in place, including the depth that they are fishing as it affects the habitat and other species. It requires a lot of documentation, a whole host of changes in the way the fishermen do things, so that when the certifiers come, they are satisfied that Guyana is practising sustainable fishing methods,” Vieira said, while noting that there is a lot of ground work that needs to be done countrywide and the certification process takes some 18 months to be completed.
With the additional certification required, Vieira said that most of his customers have indicated that by the end of next year they will only be purchasing shrimp that has been caught via sustainable fishing methods and an eco-label from the MSC will be required to prove that they have complied with all the requirements and methods.
“These customers have an obligation to their customers that they are buying MSC shrimp and I don’t think, unless a lot of changes are made or unless people make an extra effort, that we may meet the deadline,” Vieira noted.
In addition to the new requirements, he also explained that there is a problem with the US market – their largest market – where prices have started to drop significantly along with the demand because of cheaper shrimp available from around the world.
“…We probably get a very good price more than other countries but at the same time the people will divert to the cheapest,” Vieira noted, while pointing out that currently they have a surplus of over 600,000 pounds of “broken shrimp.”
With the mounting challenges and market issues, Vieira said that he wants to exit the industry before he incurs a significant amount of debt and loss.
“If the market continues to go down, we stand to lose money quickly and I don’t want to end up eventually closing with a whole set of debts that I have to end up giving up my property to pay off,” Vieira explained.
When questioned about whether he was approach-ed by any companies to sell the property housing the plant at Houston, Vieira said he was not and emphasised that he is only selling the processing equipment and trawlers and will make a decision on what other business he will delve into.
“I haven’t had any dialogue with anyone. When I close off and I am approached by people, if it’s a good deal I will look at it but I haven’t spoken to anyone,” he affirmed.
Vieira also denied claims that high taxation was one of the reasons that influenced his decision to pull out of the industry and highlighted that the business enjoys “exceptional incentives from the government” and had never had any complaints over taxes.
With over 380 employees expected to be without jobs by July 15th, Vieira noted that he has a verbal agreement with Noble House Seafoods for the purchasing of the shrimp processing equipment. As a result, Vieira explained that a large amount of the workers, including the captains of the trawlers, will most likely be retained.
Noble House is also interested in purchasing the trawlers currently supplying B.E.V.
“These people have been performing well and catching good quantities of shrimp, so I would be surprised if they don’t take the same captains and crews. In terms of our staff, once they take that amount of equipment that we have to process the shrimp from those trawlers, they will need staff to man the equipment, so I would say a minimum of 125 or more,” Vieira pointed out.
While the staff was informed last Friday of his intended move to close the operations, Vieira said that he would hold another meeting with them later this week.
“I promised to speak to them again today with a more detailed explanation later in this week but this doesn’t change my decision. They fully understand that by July 15th we intend to stop processing and I’ve given them more than one month’s notice,” he added.