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Rice sector continues its struggle in first half

A woman works in a rice field in Takeo province last year. Aim Valinda
A woman works in a rice field in Takeo province last year. Aim Valinda

Rice sector continues its struggle in first half

Cambodian rice exports decreased nearly 6 per cent year-on-year during the first semester, reinforcing concerns about the future of the rice industry, the Kingdom’s most important agricultural sector.

A report released yesterday by the Secretariat of One Window Service for Rice Export showed Cambodia exported a total of 268,190 tonnes during the first six months of 2016, down 5.8 per cent compared with the same period a year earlier.

Hean Vanhan, deputy director-general of the agriculture department of the Ministry of Agriculture, said that the decline may be a harbinger of what’s to come.

“Rice exports fell during four of the first six months of the year, which is a warning that we need to work together to solve the sector’s problems,” he said. “Rice millers don’t have enough rice in stock, and we recognise that they lack funds.”

The government agreed last week to provide up to $30 million in emergency loans to members of the Cambodian Rice Federation (CRF) to help buoy the struggling rice sector.

Vanhan said the financing package was good, but the funds should not be simply handed out to rice millers who request assistance.

“We need to look at the capacity of rice millers before we give them a loan as some millers are facing bankruptcy because they lack capacity,” he said. “If we simply give them the money, the money will be lost.”

Rice industry experts say the sector is suffering from a number of issues, including competition from low-cost Vietnamese imports, high production costs, and millers’ lack of finance.

According to CRF president Sok Puthyvuth, who was re-elected for a second term last Saturday, the issues have already resulted in between 10 and 20 per cent of the nation’s rice millers declaring bankruptcy.

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