Environment
Ryan Schuessler

Battle over caviar production rages in Missouri, Oklahoma

Little-known fisheries in showdown with Oklahoma state program as paddlefish egg harvesting booms

OSAGE BEACH, Mo. — “Watch out, Pete!”

A golf ball zoomed by and splashed into the water about 10 feet away. Kendall Montavy waved his arms to the golfers in the distance, signaling that the shot didn’t make it to the green. He looked back down at the creature lying in front of him. They were kneeling in a pond tucked alongside a golf course just off a Missouri highway in the upper Ozarks.

“Here, this one’s a girl,” Kendall said before hoisting a nearly 5-foot-long paddlefish up from the water, handing it to Steve Kahrs, who passed it to another man standing next to the holding tank on the flatbed of a truck. The man slid the fish into the tank, where there were already a few others.

Steve’s brother Pete grabbed another paddlefish from the dozen or so floating in the net around him and Kendall. Another ball flew by and splashed into the water.

“Another boy,” Pete said before tossing the fish back into the pond.

It’s spawning season at Osage Catfisheries. On a Thursday late last month, the group was out looking for female paddlefish fat with eggs. Lurking beneath the course’s water traps is the lifeblood of this family business: fish. Massive fish of all kinds. They’re sold around the world to stock ponds and lakes, to be used for research, or to go on display at places like Bass Pro shops. 

But on that day, the paddlefish were being pulled out of this pond for a different, saltier reason — caviar.

In the 1980s, fishermen along American rivers found themselves being pulled into a lucrative market fueled by an international demand for fine caviar. Legal fishing flourished, as did large-scale poaching of paddlefish. Government agencies got involved in the caviar business as a result, which flooded the market with low-cost product. Prices bottomed out, leaving those like the Kahrses grasping for new buyers, an effort now complicated by the escalating political situation in Ukraine.

Yet it all comes back to the paddlefish.

Photos: Harvesting paddlefish

Half a world away

Decades ago, the international caviar market was on the verge of collapse. In the years leading up to and following the demise of the Soviet Union, beluga sturgeon in the Caspian Sea were overfished. By the late ’80s, they were on the verge of extinction and became a protected species. Demand for the delicacy remained high, supply plummeted and prices soared.

Half a world away in the Missouri Ozarks, Jim Kahrs, Steve and Pete’s father, saw that as an opportunity and became one of the early players in the American caviar market, turning his family-run fishery into an international caviar exporter. Paddlefish and sturgeon eggs quickly became an in-demand supplement for traditional caviar.

“This was my dad’s dream,” Steve said. “We’re trying to fulfill it.”

These days, you could say the Kahrs brothers are paddlefish ranchers. The paddlefish is a prehistoric species that was swimming in North America’s rivers long before people roamed the land. Also called “spoonbill,” it’s aptly named for the long, flat proboscis protruding out of its head.

Pete Kahrs pulls a paddlefish out of the water, demonstrating its size.
Pete Kahrs pulls a paddlefish out of the water, demonstrating its size.
Ryan Schuessler

“They are incredible fish,” Pete Kahrs said, looking down at the fish around his feet as one of the paddles splashed out of the water. “And God certainly has a sense of humor.”

The family raises its fish in private ponds and lakes around Missouri, promising a cut of the caviar revenue to the landowners. It takes about a decade to raise a fish before the eggs can be harvested, and the Kahrses have been waiting for thousands of pounds of eggs, potentially amounting to more than $1 million in caviar.

But even though those eggs have been ready for harvest for some time now, this is the first significant amount of caviar coming out of Osage Catfisheries for the past few years. Last year, the Kahrses weren’t sure if their caviar business — branded l’Osage Caviar — would last.

Ask why, and they’ll point to the neighboring state government of Oklahoma.

State-run operation

While the Kahrs brothers were busy collecting fish from a golf-course water hazard, operations at the Paddlefish Research Center in Miami, Oklahoma, were in full swing. The center is run by Brent Gordon out of the Oklahoma Department of Wildlife Conservation, who likes to tell the story of a bad date he once had, all because the girl said paddlefish were ugly.

“I looked at her and said, ‘I don’t think we’re going to get along,’” Gordon said, laughing.

Gordon’s job is all paddlefish, all the time. Northeastern Oklahoma, particularly Grand Lake, is probably the largest paddlefish fishery in the world, and that means Oklahoma has a lot of caviar potential. Starting in the late 1980s, it became illegal for individuals or organizations in Oklahoma to sell or transport paddlefish caviar. The state itself is now the only entity that can do so. 

Paddlefish brought to the center for processing. The bones provide data to the center, which monitors the paddlefish population in Oklahoma.
Paddlefish brought to the Paddlefish Research Center for processing. The bones provide data to the center, which monitors the paddlefish population in Oklahoma.
Ryan Schuessler

The Paddlefish Research Center is part office, part laboratory, part processing plant. Recreational anglers fishing for paddlefish — called “snagging” — can bring catch to the center on a voluntary basis. Gordon’s team will fillet the fish and package its meat for the anglers at no cost. In exchange, the center collects ecological and biological data from the fish, and, if it’s a female, they’ll take her eggs as well. On site, those eggs are processed into caviar, stored, and shipped around the world. The remaining carcasses are turned into dog and cat food. The entire process electronically tracks each piece of the fish and the angler it came from.

“It really is down to the egg,” Gordon said.

The data gathered from the fish are invaluable in determining the health of the fishery, he said, and directly affect how it is managed each year. Since they’re an internationally protected endangered species, paddlefish snagging is highly regulated in most states where they are found.

“Keeping a paddlefish is a privilege in many states,” said Jason Schooley, a paddlefish biologist at the center. “Oklahoma has liberal regulations.”

The money the state makes doesn’t hurt, either, especially when combating illegal poaching of paddlefish, which is a common problem in many states. The revenues from the caviar sales, which go back to the Oklahoma Department of Wildlife Conservation, have paid for law enforcement tools such as new boats and night-vision goggles, as well as the state-of-the-art processing facility in Miami (the program was once run out of a few trailers).

Last year, the center produced and sold approximately 15,000 pounds of paddlefish caviar; it can bring in up to $2 million annually, depending on the price. It’s an entirely self-sufficient operation that employs a couple of dozen people each year.

It’s the program’s success that producers like Pete and Steve Kahrs say hurts their business. But beyond the economics, what frustrates them the most is that their biggest competitor is a government agency.

“A government agency is depressing the market,” Steve Kahrs said. “That’s our biggest issue with Oklahoma.”

Uneven competition?

Fish farmers like the Kahrses and commercial fishermen, such as Cliff Rost, who produces paddlefish caviar out of a fish house he runs with his wife in Morrison, Missouri, say the state’s ability to harvest fish without having to raise or catch them — and in quantities of 10,000 to 20,000 pounds a year, sometimes half of all the paddlefish caviar produced in the U.S. — creates a competitive imbalance.

“How am I, as a small business, supposed to compete?” Rost said. 

The center usually produces between 15,000 and 20,000 pounds of paddlefish caviar each year, but is cutting back starting this year.
The center usually produces between 15,000 and 20,000 pounds of paddlefish caviar each year, but is cutting back starting this year.
Ryan Schuessler

In the end, the retail prices are different because of that fact. Without the same production costs, Oklahoma can sell its caviar for anywhere between $50 and $150 per pound, while the Kahrses said they have to sell at $300 per pound to turn a profit. And given its massive presence in the industry, Oklahoma sets the market.

“They really screwed everybody,” Steve Kahrs said. “We’ve had interested buyers waiting for Oklahoma to set the price before they’ll buy from us.”

Gordon refuted those claims and said the program he manages has had little effect on the international caviar market and exists primarily to protect Oklahoma’s paddlefish.

“I understand where they’re coming from,” Gordon said. “But this thing was never set up to make money.”

Rost disagrees.

“I see a bunch of caviar being sold to build a brand-new facility,” he said. “That’s what I see.”

Commercial fishermen and paddlefish caviar producers in Missouri, Arkansas, Indiana and other states who, like the Kahrses and Rost, have pointed to Oklahoma as the biggest problem in their market are getting a break this year — albeit a small one.

Oklahoma restricted the number of fish that anglers are allowed to keep to two — in the past there was no limit. The data indicated that a large part of the population of adult paddlefish in Grand Lake was nearing the end of its natural life span, and long-term management of the fishery required a decreased harvest. This means there is less caviar for Oklahoma to sell.

“The population [of fish] needed it,” Gordon said. “And I hate to cut the anglers, but this population needed it. And I think that proves we’re not in it for the money.”

‘Looking up’ and abroad

Gordon expects that the center will end up producing 9,000 to 10,000 pounds of caviar, down about one-third from its usual output. This is opening up room for other producers like Rost and the Kahrs brothers. Kahrs said prices have already gone up a little.

“But we’re still not where I want us to be,” Steve Kahrs said.

“In general, things are looking up,” Rost said. “Naturally, when you have Oklahoma cutting their production in half, things will be looking up.”

The Kahrses have a vision for what might finally allow them to sell the thousands of pounds of eggs sitting in their fish: the Russian palate.

Steve said he has a buyer interested in moving thousands of pounds of paddlefish caviar into Russia, and Osage Catfisheries has enough eggs to make that happen. However, shipping to Russia already creates another maze of government regulations that Steve and his brother are begrudgingly trying to navigate. And the situation in Ukraine hasn’t helped, Steve said.

“There was already friction,” he said, “but now this is making it worse.”

They tried to send a test shipment to St. Petersburg recently. It made it across the Atlantic, overnighted in Stockholm, but was immediately confiscated by customs agents once landing in Russia. To date, they don’t know what happened to it, but they expect it has disappeared into the black market.

“The Russian market is where we need to be,” Steve said. “But it’s a hell of a time to be getting into the Russian market.”

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