Maldives Industrial Fisheries Company (MIFCO) has said that the company was purchasing fish at a rate of MVR 16 per kilo at a loss and that the company cannot continue to permanently purchase at that rate without government subsidies.

In a statement sent to the media yesterday, MIFCO said it would have no choice but to reduce the price if the rates fall in the international market in the future. MIFCO said it would not be sustainable to change the price now.

MIFCO said the company tried to maintain the fish purchasing price at a minimum rate of MVR 16 although prices in the world market had declined since the price was set. But having a fixed rate of MVR 16 is not sustainable, MIFCO said.

MIFCO said the government had previously given the company a subsidy between MVR 20 million and MVR 25 million when the rate was fixed at 16 and that the government subsidy is still needed to keep a fixed rate.

"The company's cash flow is facing serious challenges due to the decline in fisheries and the cashflow shortage faced by the government," the statement read.

MIFCO said the fishing industry was facing a record low this year with only 26,000 tonnes of fish weighed by the company so far this year. An average of 67,000 tonnes of fish is sold to MIFCO every year with the figures at 72,000 tonnes last year alone.

The company has offered ice and fuel to encourage fishermen to go fishing. But a decline in fisheries as well as the low fish purchasing rate has pushed fishermen to avoid heading out to sea.

The fish purchasing price was decreased on June 30.