Logo of Phnom Penh Post newspaper Phnom Penh Post - Feast or famine for rice farmers?




Feast or famine for rice farmers?

Feast or famine for rice farmers?

5-story-1-.jpg
5-story-1-.jpg

Despite requesting a $38 million emergency food aid package, the government is confident it will meet its rice export quotas as the global price of the commodity continues to rise

HENG CHIVOAN

Yen Bunlung, 10, stands in his parents’ parched rice field in Takeo province.

WELL before rainfall shortages struck this year, the Kingdom was preparing to reap the windfall of sky-high global rice prices through lucrative export deals with foreign governments. 

But as harvest time draws near, the government is sending mixed messages about the country's anticipated food stocks - or lack thereof.

Despite last week's request for a US$38 million food security aid package from the Asian Development Bank, the government maintains it has the food security situation under control and will go ahead with its rice export plans.

Even as drought grips large swaths of the country, the Agriculture Ministry optimistically expects nationwide rice production to reach seven million tonnes this year, a slight increase from the 6.7 million tonnes it reported last year.

"Some areas are facing drought, but we are optimistic that our export deals signed by the government will not affect our ability to meet local demand," Agriculture Minister Chan Sarun told the Post.

"I am not concerned about having a food shortage this coming year even if the government increases its volume of rice exports because these contracts are signed only after a thorough evaluation of domestic surplus."

This year's harvest is expected to yield a surplus of one million tonnes, according to Phou Puy, president of the Cambodian Rice Millers Association.

With such overflowing stores, the government's request to the ADB for emergency food assistance served only to secure a safeguard against sudden, unexpected shocks, such as those brought about by natural disaster, Chan Sarun said.  

We are optimistic that our export deals ... will not affect our ability to meet local demand.

Blame the futures market

The global commodities crisis that has lifted the price of everything from petrol to gold didn't spare rice - the staple food for half of the world - and has created new opportunities and problems related to the grain's trade.
Rising rice prices create a potential boon for farmers and investors, and have attracted nontraditional players, such as hedge funds, into the market.

But they have also raised humanitarian concern over the diminished purchasing power of poor consumers.

Cambodia has gained a host of new suitors this year eyeing the fruits of its fertile farmland.

The Gulf states Kuwait and Qatar initiated plans to lease Cambodian farmland to secure rights to its produce, while the government inked a deal to export 120,000 tonnes of rice to Guinea. Other West African countries have followed suit, with Senegal, for example, ordering 6,000 tonnes of broken rice, the low-quality residue from successive sortings between broken and intact rice grains.

Mao Thara, undersecretary of state at the Ministry of Commerce, told the Post that the government has not yet calculated its anticipated volumes of rice exports. He said contracts were still being negotiated, adding that a team was headed to Senegal on October 20 to discuss a new deal with the West African country.

A contradiction in terms?

The government stands by its plan to ink major agriculture export deals with foreign governments, despite the ADB's announcement last week of a proposed US$38 emergency food assistance project to address what its country manager described as "an unprecedented emergency" in Cambodia's food security.

"The food security concern in Cambodia is not whether the country is capable of producing sufficient food to feed its own population, which it is capable of for many years already, but whether basic food commodities would remain accessible to the rural and urban poor under the current environment of unprecedented global increase of food and fuel prices,"   Arjun Goswami, the bank's country director, told the Post.

Worldwide price hikes for food and fuel have pushed traders to sell their rice to neighbouring countries, thus driving supply down and prices up, he explained. 

Long Vou Piseth, the ADB officer in charge of the food project's implementation, said it would address the needs of both suppliers and consumers, distributing food rations to those most in need and selling seeds and fertilisers to farmers at a subsidised rate.

According to Kang Chandararot, head economist at the research institute Cambodia Institute of Development Study, the price of rice at markets in Phnom Penh has risen by around 50 percent since the beginning of the year, a dramatic price hike that he attribute largely to inflationary pressures caused by rising world demand and higher input costs.

"Helping out Cambodia's farmers to boost their output could stabilise the supply and price of rice in the region," he said, referring to why the ABD would want to plough millions of dollars of food aid into a country that is exporting rice commercially. 

MOST VIEWED

  • Vietnam: Tougher sentences for child abusers

    Several National Assembly (NA) deputies in Vietnam are calling for tougher penalties to be handed down to child abusers. They hope stricter punishments will act as a strong deterrent to prevent offenders committing further offences in the future. Extreme measures such as chemical castration were

  • Central bank to shun small US banknotes

    The National Bank of Cambodia (NBC) is considering not accepting smaller denominated US dollar banknotes – $1, $2 and $5 – from banks and microfinance institutions (MFIs) which it said are flooding its stockpile as the demand for those notes is low. While some banking insiders welcomed the move as

  • PM lauded in Covid-19 fight

    World Health Organisation (WHO) director-general Tedros Adhanom Ghebreyesus sent a letter to Prime Minister Hun Sen thanking him for following the WHO’s guidance and commending Cambodia’s efforts in the fight against Covid-19. In his letter made public by the Ministry of Foreign Affairs

  • Workers return, hope for salaries

    More than 600 factory workers in the capital’s Chaom Chao commune in Por Sen Chey district returned to work after the factory’s owner promised to pay their salaries in instalments until the middle of next month. On Tuesday and Wednesday, more than 600 workers gathered

  • Women detained for forcing kids to beg

    Two women were sent to Phnom Penh Municipal Court on Thursday for forcing six children to beg for money for several months at the Chhouk Meas market in Krang Thnong commune in the capital’s Sen Sok district. Phnom Penh Department of Anti-human Trafficking and

  • Vietnamese tents baffle border guards

    Kandal and Takeo provincial authorities bordering Vietnam have expressed concern after witnessing irregularities by the Vietnamese authorities, including the deployment of soldiers to erect 114 camps just 30m from the border. Takeo provincial governor Ouch Phea told The Post on Thursday that Vietnamese soldiers had erected 83