Prime Minister Hun Sen on Wednesday appealed to rice millers and paddy buyers not to lower prices and to secure better rates for farmers facing difficulties in the early harvest season.
The Cambodian Rice Federation (CRF) said the low prices were due to an influx of poor quality paddy in some areas.
“I ask buyers of paddy from farmers for milling to sell in the market and for export, please do not to take any action that will depreciate harvested rice prices,” Hun Sen said at a Cambodia University of Specialties (CUS) graduation ceremony on Wednesday.
The CRF said in a press release that paddy prices had been dropping since last week due to poor quality, including many varieties of broken rice.
“The cheapest are sra nge paddy and mixed paddy that does not have an export market demand,” the CRF said.
The statement said that consumers had found aromatic phka malis and somaly paddy from some areas of Pursat province to be lacking in aroma and unacceptably hard.
There were also issues with broken paddy and brown spot disease in Banteay Meanchey and Siem Reap provinces.
However, some areas in Kampong Speu, Takeo, Kampot and Kandal provinces were producing good quality paddy that fetched high prices.
“The price of good quality paddy such as phka malis, phka romduol and sen kra op has dropped by 100 riel ($0.02) per kilogramme,” the statement said.
CRF secretary-general Lun Yeng told The Post on Wednesday that the drop in quality was due to drought.
“The price of the good quality crops – phka malis, phka romduol – is the same as last year, which is around 1,200 riel ($0.30) per kilogramme, while sen kra op paddy costs 1,000 riel ($0.24),” he said.
“Rice millers did not want to lower the price of paddy, but [they had no choice] because of the poor quality of the crop,” he said.
Heng Pheng, the CEO of Thmor Korl Rice Import Export Co Ltd, a Battambang-based rice exporter, said the price of sen kra op paddy has risen from 950 riel ($0.23) to 1,012 riel ($0.25) per kilogramme.
“The decline in paddy prices resulted from most rice millers having bought only good quality paddy, phka romduol, so the price of sen kra op paddy dropped slightly, but it has recovered,” he said.
Centre for Policy Studies director Chan Sophal said the prime minister’s call would not affect the free market due to it being only an appeal and not a regulation.
“The appeal is to give comfort to the farmers, but it is now down to the big buyers who depend on the international market,” he said.
The Rural Development Bank last week loaned $50 million to the Cambodian rice industry to address capital shortages to buy paddy and stabilise prices.
The CRF said $50 million will buy nearly 300,000 tonnes of paddy for stockpiling.
According to an official report, in the first 11 months of this year, rice exports to the international market totalled 514,149 tonnes. This was a 3.4 per cent increase compared to the same period last year.