Tracey Shelton

Rice sellers at Kap Koh Market in Phnom Penh.

The government's two-month ban on international rice exports has been lifted although some restrictions will remain, Prime Minister Hun Sen announced May 26.

The Government will allow 1.6 million tons of milled rice to leave Cambodia from now until December 31, but the Ministry of Commerce has only given licenses for Green Trade -- a state-owned agriculture firm -- and the National Cambodian Rice Millers’ Association (NCRMA) to export more than 100 tons at a time.

Hun Sen has also pledged that farmers engaging in small-scale rice trade across the border can continue to do so tax-free, and without a Ministry of Commerce license.

"People who used to export via illegal checkpoints will return to trading through legal channels," Hun Sen said.

"It will now be easier for us to calculate the level of rice exports."

He assured the public that the country does not have a shortage of rice, adding that most families set aside rice stocks for their own consumption.

He said that 80 percent of farmers are happy with the high price of rice, which is currently trading at between 2,000 riels ($0.50) and 3,600 riels per kilogram.

The chairman of the NCRMA, Pu Puy, welcomed the government’s decision to lift the ban on rice exports, saying that the association plans to export 30,000 to 50,000 tons of milled rice this year to Vietnam, Thailand and Germany.

"Our aim is to export our product and bring capital into the country," he said.

Pu Puy added that the NCRMA is aiming to reduce unhusked paddy exports by seeking some $70 million in capital to buy paddy from farmers, process it within Cambodia and sell the milled rice on the international market.

He said that potential partners are arriving in Phnom Penh in early June to discuss the possible export of milled rice to Germany. So far, Cambodia has exported 200 tons to the European nation.

Y Vy, a rice vendor near the Central Train Station in Phnom Penh, said that she welcomed the decision to reopen rice exports, but was concerned that prices could again jump if too much of the precious grain is sold abroad.

"It is normal. Once there is a shortage of a product, its price will jump up," she said. "Poor people in Phnom Penh may soon be concerned again with the cost of rice."

The government will review its decision again at the end of the year.