Caviar business is fishy

December 08, 1991|By New York Times News Service

NEW YORK -- The Cold War may be over but the annual caviar war is flaring up again. Macy's and Zabar's are sniping at each other's bottom lines on beluga. In the next few weeks, the price of a 14-ounce container of this most prized grade of sturgeon eggs is likely to fall well below last year's price of just under $400.

This year, there is also plenty of undercover maneuvering worthy of John le Carre. The breaking up of the Soviet Union has thrown a once orderly business into turmoil.

Lack of central government control there has opened the door for all kinds of entrepreneurs: on the fishing boats, in the processing plants and in the marketplace.

In this country, caviar peddlers, like mercenaries in a guerrilla skirmish, are out in force, circumventing the traditional tightly controlled avenues of caviar export. These are mostly Russians who have obtained tins of caviar in the Soviet Union and have gone into business for themselves.

A number of American and European importers and dealers have been approached about entering into joint ventures to produce caviar in Russia.

Mats and Dafne Engstrom, the owners of California Sunshine, a food importer and distributor in San Francisco, have already started one with a group of Russians to produce caviar in eastern Russia, not the Caspian Sea, the traditional source of sturgeon caviar.

Since 1965 most of the Russian caviar exported to Europe, the United States, Canada and Latin America has been bought through agencies in Hamburg, Germany, and in Switzerland.

"We have been paying in deutsche marks for caviar since 1965," said Gerald Stein, the president of Iron Gate, Macy's main supplier. "And until the shah of Iran was overthrown, the caviar business was pretty orderly. It gradually began to break apart in the 1980s and now it has become very factionalized."

For example, Murray Klein, one of the owners of Zabar's, at 80th Street and Broadway, and that store's caviar maven, said peddlers have been showing up on his doorstep regularly for the last year.

"But I won't buy from them," he said. "What they are bringing me is half the price, and I don't trust it."

But this "peddlers' caviar," which a number of importers say has been more available worldwide this year than ever before, amounts to a small fraction of the estimated 150 tons of caviar exported from Russia every year.

Total American consumption is estimated in the industry to be about 40 tons a year, as it has been for the last decade. About a thousand tons of Russian caviar is produced annually from the Caspian Sea.

The best caviar, usually reserved for export, is processed at sea on factory boats as soon as the fish are caught. The rest is sent to processing plants on shore to be tinned or jarred and, usually, pasteurized. Some dealers say that a small amount of Iranian caviar, which is allowed in Europe but not the United States, makes its way into the Russian caviar pipeline.

"A lot of caviar is laundered in Germany," Dafne Engstrom said. She suggested that counterfeit tins are being produced in Europe to be filled with lesser quality caviar and passed off as top quality Russian.

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