Aiming to boost Cambodia’s agriculture sector, the government rolled out the Promotion of Paddy Rice Production and Export policy at the end of 2010 and set the target of one million tonnes of milled rice to be exported by the end of 2015. Half way through this year and it looks as though the ambitious goal is likely to fall short. The Post’s Chan Muyhong sat down with Hean Vann Horn, the Chief of the Secretariat of One Window Service for Rice Export Formality, an institution that works with the Ministry of Agriculture, to discuss the sectors achievements, challenges and the future of Cambodia’s rice industry.
Since the establishment of the policy in 2010 what have been the major achievements of the industry?
From 2010 to 2014, Cambodia has changed to become one of the top ten rice exporting countries. Our rice exports have kept increasing every year from around 200,000 tonnes in 2011 to more than 387,000 tonnes last year.
Our rice has won the World’s Best Rice Award for three years in a row and is becoming well-known in international market. There is also increase of rice exporters since then. The market has been expanded to countries in the EU and recently China.
How much has been achieved towards meeting the goal over these years?
Cambodia’s government set out the policy in late 2010. The implementation of the policy started in around 2011. There are two main goals we want to achieve. First, to have paddy rice surplus at more than 4 million tonnes.
Second, is to export at least one million tonnes of milled rice to international market. Cambodia paddy rice production has increased from 8.7 million tonnes in 2011 to around 9.4 million tonnes last year. Surplus of paddy stood at 4.3 million tonnes in 2011 to 4.8 million last year.
The export this year has also increased sharply. From January to May this year, Cambodia has already exported 234,025 tonnes of rice, up by 64 per cent compared to the same period last year. Just in May alone, the export figure has doubled compared to May last year thanks to the rice quota from China that we have successfully negotiated. This shows a significant progress of our rice industry.
The government has also launched many other policies and facilities to help the private sector. For example, the establishment of this Secretariat of One Window Service for Rice Export Formality to simplify the process of exports, a working group between government and private sector to solve the challenges and holding government and there is a private sector forum once a year.
Do you think Cambodia will be able to reach its goal of one million tones exported by the end of this year?
Nothing can be said on this for now. But for me, I think if nothing changes, by the end of this year, I expect the export figure to stand at least more than 500,000 tonnes.
But if there is a new quota from China, which for now we are not sure yet, I think we can reach the goal of one million tonnes. But actually according to international records [of formal and informal exports], Cambodia has already achieved the export of one million tonne of rice.
If we cannot reach our goal to export one million tonne of rice this year, it is not because Cambodia does not have modern milling facility, but it is because Cambodia do not have rice to export. We have surplus of paddy, but the paddy is all being exported the neighbouring countries. Millers do not have enough capacity, both drying facility and financial, to stock paddy rice. Farmers now have also changed. Farmers in the past have paddy stock at their house, but now it is rarely to see this happen. They need money fast to pay back loans, so they sell it quickly to middlemen. It is a challenge for now.
What needs to be done in the industry?
It is true that production costs in Cambodia are higher when compared to other countries. Our productivity remains lower compared to neighbouring countries. Electricity, transportation and access to finance are still challenges that the industry needs to overcome to increase competitiveness. The government has been working to solve the challenges through policy and facilitations.
Out of the four strategic plans set out in the Promotion of Paddy Rice Production and Export policy – increase rice production, collection and process, export, and diversify markets – the first action plan has been achieved with good results. The last three strategies need to be reviewed more as the results have been very limited. Cambodia, by the end of this year, will need to review and make changes to the Promotion of Paddy Rice Production and Export policy to improve it.
Edited for length and clarity.