Logo of Phnom Penh Post newspaper Phnom Penh Post - Rubber sector slows

Rubber sector slows

Rubber sector slows

090420_13.jpg
090420_13.jpg

Falling international rubber prices are leading to a sharp drop in cultivation, putting govt production targets at risk

Photo by: Christopher Shay

Newly planted rubber trees in Mondulkiri province. Fewer trees are being planted as rubber prices fall.

Expansion of Cambodia's rubber cultivation will lose momentum by an estimated 61 percent in 2009 year-on-year, according to new government figures.

Ly Phalla, director general of the Rubber Plantation Department, told the Post Sunday that an additional 10,000 hectares of rubber trees would be planted in 2009 compared with an increase of 25,901 hectares in 2008.

"Looking at seedlings, I believe that plantations this year will not increase as much as last year," said Ly Phalla.

In 2008, Cambodia had 107,901 hectares under cultivation, up 31 percent on a total 82,000 hectares in 2007.

The expected decline comes as international rubber prices hit US$1,400 per tonne, down from $3,500 per tonne in 2008, according a report by the Ministry of Agriculture, Forestry and Fisheries.

Lower automobile sales and rising stockpiles in China have contributed to sinking global rubber prices.

Ly Phalla said that lower international rubber prices and the global financial crisis are putting pressure on Cambodian farmers but that the decrease had not affected the national plan to cultivate 150,000 hectares by 2015.

"I think that the cultivation of rubber trees will increase again in 2010 as more trees are planted in western and northern provinces," Ly Phalla said.

Hak Vantha, a farmer from Chamkar Leu district of Kampong Cham province, who owns 20 hectares of rubber, said the slowdown was causing him to reconsider plans to plant more trees.

"I have 11 hectares of banana farm land, but I cannot cut down the banana trees to grow rubber trees because the rubber price is still not good," Vantha said. "I may cut down the banana [trees] to grow rubber next year if prices increase," said Hak Vantha.

Ly Phalla said that the slowdown has put some rubber planting projects in doubt.

"What we can see now is that some companies are attempting to cancel their rubber plantation development plans because they have difficulty raising money from banks," he said.

Nationwide, 8,205 hectares of rubber are grown under land concessions.

Another 45,469 hectares are grown on state land cultivated by private companies, and 4,041 hectares are grown under international development projects.

The remaining 50,186 hectares are grown by families.

Despite the slowdown, a $100 million plantation deal was signed this month, between the Khaou Chuly Group and the French company Socfina, to plant 20,000 hectares of rubber trees by 2010.

MOST VIEWED

  • Diplomatic passports issued to foreigners to be annulled

    The Ministry of Foreign Affairs and International Cooperation will move to annul diplomatic passports issued to those not born in Cambodia. Analysts say the move may be in relation to reports that former Thai prime minister Yingluck Shinawatra used a Cambodian passport to register as

  • Hun Sen warns Irish MP of EBA ‘mistake’

    Prime Minister Hun Sen on Saturday told former Irish premier Enda Kenny, still a member of the EU nation’s parliament, that the 28-nation bloc should not make a “third mistake” regarding Cambodia by using the preferential Everything But Arms (EBA) agreement to “take 16 million

  • The hairy little heroes saving many lives in rural Cambodia

    IN RURAL Siem Reap province, rats dare to tread where no person will, as these hairy little heroes place their lives on the line each day for the good of the local community. The rodents are the most important members of a special team, leading

  • PM warns EU and opposition on 34th anniversary of his rule

    HUN Sen reached the milestone of 34 years as Cambodian prime minister on Monday and used the groundbreaking ceremony for a new ring road around Phnom Penh to tell the international community that putting sanctions on the Kingdom meant killing the opposition. “Please don’t forget