Logo of Phnom Penh Post newspaper Phnom Penh Post - RDB loans $30M to boost rice purchases

RDB loans $30M to boost rice purchases

A woman harvests her rice crop at a paddy field in Phnom Penh’s Dangkor district in 2016.
A woman harvests her rice crop at a paddy field in Phnom Penh’s Dangkor district in 2016. Heng Chivoan

RDB loans $30M to boost rice purchases

The government has provided $30 million in loans to rice millers since September to facilitate the purchase of paddy rice, with the head of a state-run bank saying more money was available if necessary.

The loans were issued to 38 rice millers by the state-owned Rural Development Bank (RDB) following September’s rice harvest, and would need to be paid back by April this year, according to RDB’s CEO Kao Thach.

“Demand for loans keeps increasing, however it still has not met what the government has provided,” Thach said. “We still hope the need for loans will increase by next harvest season, as capacity of storage and drying will be ready.”

Over the past two years, the RDB has focused on beefing up millers’ storage and drying capacity to improve processing and enable the staggered purchase of paddy rice, which could raise paddy rice prices and help farmers.

That effort has proved moderately successful, though some farmers have said that other issues, such as lack of access to water and pests, have eaten into any profits that higher prices might have brought.

Rice miller Khmer Food group, which received about $10 million loan from the RDB last year to expand drying and storage facilities, has received about $1 million this season from the RDB to buy paddy rice, according to CEO Kim Savuth.

“The demand of the international rice market has increased, and rice millers saw the opportunity for profit, so they applied for loans to buy the paddy rice,” Savuth said. He also predicted the demand for loans would increase as the expanded storage and drying facilities came online in the coming months.

The emergency rice fund was launched with $27 million in September 2016, following large protests from rice farmers in Battambang province. The government injected another $23 million in August last year.

Savuth, who is also the vice-president of the Cambodia Rice Federation, said that while the ADB’s actions had provided relief for the rice sector, persistent problems – such as high logistical costs and bloated energy prices – were still threats to the industry.

MOST VIEWED

  • US to ramp up sanctions after ‘flawed’ national polls

    At a press conference on Wednesday, the US State Department announced that it would expand visa sanctions on the Cambodian officials and individuals it deems responsible for “undermining democracy” in Cambodia. At the briefing, spokesperson Heather Nauert reiterated that the department regarded the July 29 elections

  • Final poll results confirm first single-party Assembly

    IN an unprecedented situation in Cambodian politics, the official results of the July 29 national elections have declared that the Cambodian People’s Party (CPP) will take all 125 seats in the National Assembly on the back of it receiving 76 per cent of the votes. The National

  • Chinese influence to sweep Kingdom?

    Growing Cambodia-China ties have seen the latter’s influence sweep across the Kingdom through increased investments and tourism. The Asian giant has become the leading source of foreign funds in Cambodia, fuelling the construction sector with huge casino and hotel projects. Much of the growth

  • PM's Bodyguard commander hits back at US

    The commander of Prime Minister Hun Sen’s Bodyguard Unit (BGU) Hing Bun Heang on Sunday dismissed a short video clip that went viral on social media in which he says he is preparing for a war with the United States over its aggressiveness towards