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Rice exports down 5%

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A worker looks at a bag of rice inside a rice mill in Phnom Penh. Hong Menea

Rice exports down 5%

Rice exports last month were five per cent lower than in January last year, after a full year of decline in 2018. However, a sector insider said it is not a major concern because it is only the beginning of 2019.

A report from the Secretariat of One Window Service for Rice Export Formality showed on Tuesday that Cambodia exported 59,625 tonnes of rice in January – down five per cent compared to the same period in 2018 when 62,623 tonnes of rice were exported.

The report said 23,899 tonnes of rice, equivalent to 40.7 per cent of the total export volume, were sent to EU markets. China imported 18,671 tonnes, Asean member states got 9,226 tonnes, while other destinations received 7,839 tonnes.

Sectoral challenges

Last year, Cambodia exported 626,225 tonnes of rice – down slightly from 635,679 tonnes in 2017.

The Cambodian rice export sector is currently is facing challenges. On January 18, the EU decided to re-impose duties, for the next three years, on rice exported from Cambodia.

In the first year, a tax of $200 per tonne will be levied. This will reduce to $170 per tonne the following year and in the third year, it will be cut further to $142 per tonne.

The sector is likely to face more problems exporting to the EU market if the Everything But Arms (EBA) preferential trade agreement is suspended.

‘Not worrying’

Hun Lak, the vice-president of the Cambodian Rice Federation and Chairman of Mekong Oryza Trading Co Ltd, said the decline of rice exports in January is not a worrying problem because it is only a month-long figure, and the drop was not severe.

“We cannot evaluate anything now. We need to wait and see in two or three more months,” he said.

Lak said he didn’t think that imposing tariffs on Cambodian rice exported to the European market would hurt much because the price of rice after tax has only increased slightly.

“I think those who like the taste of Cambodian rice will continue to eat it because prices have only risen a few cents per kilogram,” he said.

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