Prime Minister Hun Sen is set to sign a memorandum of understanding (MoU) on increased rice quotas with China at the 2nd Belt and Road Forum for International Cooperation in Beijing, according to a statement on Wednesday from the Ministry of Commerce.
Minister of Commerce Pan Sorasak, through state-owned rice exporter Green Trade Company, discussed rice quotas with Chinese firm China National Cereals, Oils and Foodstuffs Corporation on April 12, the statement said.
The purpose of the talks was to promote Cambodian rice exports to the international market in line with government policies and strengthen bilateral trade cooperation between Cambodia and China.
The statement said the MoU, scheduled to be signed on Saturday, is set to outline that China has agreed to buy jasmine rice, fragrant rice, white rice and broken rice from the Kingdom at a 400,000-tonne quota starting August 2019 until the end of December 2020.
The Kingdom’s previous quota of 300,000 tonnes of rice exports to China will be completed by the end of this year, the statement added.
Cambodia Rice Federation vice-president Hun Lak told The Post on Thursday that the MoU is good news for the sector as Cambodian rice exports to the EU have become subject to tariffs this year.
“The additional quota provided by China will help balance Cambodian rice exports to the international market,” he said.
A Ministry of Agriculture, Forestry and Fisheries report shows that the Kingdom’s rice exports in the first quarter of this year was 170,821 tonnes, up six per cent compared to the same period last year.
Lak expects rice exports this year to be higher than last year due to two significant factors – the additional quota from China and an undeterred export volume to the EU despite the recently imposed taxes.
China has become a major market for Cambodian rice, made only more significant with the Kingdom losing its access to duty-free rice exports to the EU on January 17 for a three-year period following complaints from Italian and Spanish rice producers.
Ministry of Commerce spokesman Long Kemvichet said the new quota will only start once Cambodia has fulfilled the old quota.
“If we complete the existing [300,000-tonne quota] before schedule, the new [quota] will come into effect immediately without having to wait until the end of the year,” he said.
According to Kemvichet, China is currently the only country that the Kingdom can export rice to duty-free.
Cambodia only managed to export 170,154 tonnes of rice to China last year – just more than half of the 300,000-tonne quota – while it exported 269,127 tonnes to the EU.
The Kingdom’s total rice exports last year amounted to 626,225 tonnes, a slight decrease from 2017’s 635,679 tonnes.