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Agro sector on a growth path

Farm labourers process harvested cassava for drying in Tbong Khmum province earlier this year.
Farm labourers process harvested cassava for drying in Tbong Khmum province earlier this year. Heng Chivoan

Agro sector on a growth path

The tonnage of Cambodia’s agricultural exports increased by over 20 per cent last year, led by a surge in shipments of dried cassava chips, according to the latest Ministry of Agriculture data.

Total exports of 66 raw and semi-processed agricultural products – chiefly cassava, rice and rubber – amounted to 4.1 million tonnes in 2015, compared to 48 products with a total of 3.4 million tonnes a year earlier, the ministry said in its annual report on agricultural production.

The expanded list includes over a dozen agricultural products exported for the first time last year, though in small quantities.

Cassava, the Kingdom’s second most important agricultural crop after rice, recorded the strongest export growth among major crops and led all products in terms of tonnage.

Total exports of dried cassava chips surged 87 per cent to nearly 2.7 million tonnes in 2015, while shipments of fresh cassava remained steady at 570,000 tonnes.

Eang Sophallet, spokesman of the Ministry of Agriculture, said the demand and price for cassava softened toward the end of 2015 and much of the increase in exports was due to orders shipped early in the year.

“The price of cassava was decreasing at the end of the year because China has reduced its demand,” he said, adding that Thai and Vietnamese buyers were also cutting back orders and keeping prices low.

However, he expects price and demand to rise this year as a major Chinese buyer looks to purchase direct from Cambodian producers.

“Ultimately, China is the main destination for our cassava exports and the price stands to increase this year because a Chinese company will buy direct from us,” he said. “The company has completed a feasibility study on importing directly.”

Hun Ly Heu, director of cassava-exporting firm Drycorpkh Cambodia Co Ltd, said the fact that more farmers were selling their cassava despite falling prices was a sign of their desperation.

“Our market depends on orders from neighbouring countries and farmers could not wait for cassava prices to rebound due to their loan commitments,” he said, calling for the government to support farmers by setting a price floor on agricultural products.

Cambodia shipped agricultural products, excluding rice, to 35 countries last year with Vietnam, Thailand and China among the top destinations, according to the ministry’s report.

After cassava, the next biggest agricultural product by export tonnage was rice, with shipments increasing by 39 per cent in 2015 to 538,000 tonnes. Natural rubber shipments increased by 13.4 per cent to 152,000 tonnes, while sugarcane increased by 47.5 per cent to 111,000 tonnes.

Sophallet said that he expects further increases in export shipments this year as the government works closely with farmers to improve their skills and implements tighter phytosanitary controls.

“We will strengthen phytosanitary compliance to international standards to match those of importing countries in order to push our agricultural exports,” he said.

The Ministry of Agriculture inspected export shipments at border points, issuing over 18,000 phytosanitary certificates last year, according to the report.

Mey Kalyan, senior adviser to the Supreme National Economic Council, said the increasing tonnage of agricultural product exports was a positive for the country, but there was a risk of putting too much emphasis on numbers.

“This is a good sign for Cambodia, but no matter how much the export amount is, the most important thing is whether or not the agricultural sector can eliminate poverty in Cambodia,” he said.

Kalyan said the government often focuses too much on growth figures and not enough on how farmers are benefitting from the sector’s growth.

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