Chip Mong Group is the latest conglomerate to invest into local production of animal feed, announcing this week that it will sink $60 million into building a large-scale feed mill and industrial piggery, a move that agricultural experts welcomed but said would still not be able to curtail the Kingdom’s dependence on imported feed.
Sen Sovann, director general of the Ministry of Agriculture’s animal production and health department, said Cambodia imported over half of its animal feed last year at a cost of $135 million. It spent another $100 million to import some 400,000 pigs from neighbouring countries to meet local demand for pork meat.
“We are still overly reliant on imports of both meat and feed,” he said yesterday. “Even though we have new feed mill factories coming soon, they will not be able to the fill the gap created by the demand from the local market, which is increasing 10 percent annually.”
According to Sovann, there are 10 local feed mills currently in operation providing feed for swine and other livestock. Their combined output covers about 40 percent to 50 percent of domestic demand.
Leang Khun, director of Chip Mong Group, said his company is sinking $60 million into a new feed mill and piggery that will help reduce this gap when it starts up in 2019. The facility will be capable of producing 200,000 tonnes of animal feed a year for pigs, of which 70 percent will be used for the company’s 280,000 pigs and the rest sold to the local market.
“We will use the latest technology from Europe for our feed mill production,” he said. “Through this we will reduce imports of feed and also supply fresh, high-quality meat at a fair price.”
Khun said developing local feed mill production was crucial to improving the production chain of the agricultural sector. However, further investment would be needed to fully meet local demand.
“Feed mill factories are an important part of the country’s agricultural production chain because we already have a lot of raw materials to supply the factories,” he said.
“Feed mill production will allow us to reduce the flow of imports and promote local agricultural products.”
Mong Reththy, CEO of agro-industrial conglomerate Mong Reththy Group, said feed mill factories offer a good opportunity for investors because the sector still has plenty of room to grow.
“Currently, because the market is dependent on imports, there is still a lot of room for investments in feed mills,” he said. “When we can produce good-quality feed products, we will be able to compete with meat importers.”
Mong Reththy Group, which inaugurated its own $10 million feed mill last December, has the capacity to produce 60,000 tonnes of animal feed a year from locally grown corn and paddy rice. The plant currently supplies the 100,000 pigs on its pig farm in Preah Sihanouk province, as well as 100 nearby family-owned farms.
Reththy said his company plans to add further production lines to increase its supply to the local market.