​Jute: an increasingly obscure industry | Phnom Penh Post

Jute: an increasingly obscure industry


Publication date
22 November 2002 | 07:00 ICT

Reporter : Robert Carmichael and Lon Nara

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It was an industry that once gave employment to thousands in Battambang's Ek Phnom

district, but the growing use of plastic sacks means the region's jute farmers now

face an uncertain future. Their situation has not been helped by the closure four

years ago of the country's only jute factory, which now sits idle in Battambang.

Nhiek Doeun guards an empty factory and a clutch of SOC-era patriotic statues.

When it was in business the people of Ek Phnom grew around 4,500 hectares of jute

- or krachao - along the flood plain of the Sangke river, selling most to the factory.

That figure has fallen dramatically - today only 200 hectares is used to cultivate

the plant.

"It is a sharp decrease," admits Chui Chheang, director of Battambang's

Department of Industry, Mines and Energy (DoIME). "The reason is that rice sacks

made of jute are no longer wanted that much. People tend to use plastic bags rather

than jute ones."

Others familiar with the defunct small industry give different stories, including

local political interference in necessary reforms at the factory, and a lack of sufficient

raw jute for processing.

Whatever the real reasons - and it is likely a combination rather than one explanation

- the people of Ek Phnom say they are now considering abandoning the crop altogether.

Len Sarom, 23, grows less than a hectare of jute. Four years ago, demand from the

Daun Teav factory meant a crop five times that, all of which he sold. Now he is pessimistic

about selling any.

"I want to stop growing it because there is no longer a market," says Sarom.

"It is a risk growing jute, because we don't know whether any businessmen will

come here to buy it. We just plant it, dry it and store it."

Last year the few traders who came to buy his harvest - which is now used mainly

for handicrafts made in the province but sold in Thailand - offered only 4 baht per

kilogram. That's around half what the farmers used to get.

Neighbor Chhan Than, 27, echoes Sarom's worries. Stand-ing beside his jute field,

Than says he has gradually reduced the amount under cultivation. He still fears he

will be left with a useless crop.

"This year I don't know if people will buy jute or not," he says. "There

has been no news about any businessmen coming to the village to buy jute. It is risky

to plant the stuff now.

"If the price continues to drop people will stop growing it. I want the government

to find a market, otherwise I don't know where I'll be able to sell my crop."

In the past jute has proved vital for these farmers living on the flood plain. Other

produce such as watermelons and beans can be grown in the fields in the dry season,

but only jute will survive the extensive flooding of the rainy season. Without a

wet season crop the farmers face a difficult future in an area that is already poor.

Kong Srey Touch, a member of the Prek Norin commune council, says living standards

are falling and people have been forced to seek work elsewhere. Not that conditions

in earlier years were much easier, she says: until 1997 the Khmer Rouge used to raid

the villages and steal their belongings.

Commune councilor Kong Srey Touch: falling living standards.

"But since the factory closed many people have left their homes in the villages

and gone to Poipet to look for work," she says. "The other activities here

are farming and fishing, but for some reason even the fish are scarce this year."

Thierry de Roland Peel managed the Daun Teav factory for its last owner, British

Anglo Cambodian Holdings Ltd. In 1995 his company signed a 30-year contract with

the government to take over the factory.

He says $1.2 million was spent to replace spare parts just to get the factory up

and running. But the operation only lasted five years, and ran up losses of around

$1 million. The result was that the factory was forced to close.

"The reason was simply that there were no raw materials," he says, adding

that the farmers sold their product to Thai businessmen "at a competitive price".

While he offered them between $90 and $150 per ton, the Thais would pay one dollar


"The farmers were not prepared to supply the factory even if they knew that

the factory wanted the raw materials," he says. "And the provincial authorities

were [of no use] in talking to the people."

The lack of raw jute meant the factory functioned for only four months a year. Its

560 workers - government staff who were paid a monthly wage of $40 - produced 130,000

jute bags each month.

He is not interested in re-opening the factory, saying only that "enough is


"Daun Teav factory is like a 'peanut' if compared to Indian jute factories,"

says Roland de Peel. "[Indian investors] should take over the factory."

Yin Thavy, a former administrator at the plant, says a lack of raw materials was

not the only problem. Politics played a part too - the company wanted to institute

reforms, but was unable to do so.

"We wanted to develop the factory, but someone always came up against us,"

he says. "We wanted to cut some of the old staff, but were refused because they

were government employees."

For his part, Chui Chheang at the provincial DoIME blames the company. He says it

encouraged local farmers to plant jute to ensure a reliable supply, but then purchased

only small amounts. Instead, he says, it should have deposited money as a guarantee

to cover the farmers' costs in planting the crop.

However Chheang is optimistic, and feels the local jute industry could yet have a

future. He is hopeful that foreign investors will one day re-open the factory.

In fact, he says, there was some interest shown earlier this year when businessmen

from India, Russia and Japan visited the plant looking at ways to make it viable.

He is not sure whether they will come back, since to get the factory working again

will require expensive refurbishment.

"Around 30 percent of the machinery still functions," says Chheang, "so

if they invest they will need to overhaul the engines, which will cost at least $2

million. But if new equipment is needed, it could cost even more."

For the jute farmers of Battambang, though, such sums are academic. Their decisions

are of a more immediate nature - whether or not to give up on the crop altogether.

They have families to feed, and the drought that afflicted them earlier this year

has pushed them to the brink.

Chhan Than, beside his jute field, worries about the future.

And it's not only the farmers who have suffered - the factory's former staff have

also lost out. Fifty-five-year-old Nhiek Doeun started working at Daun Teav in 1968

as a weaver. He kept his job there through the Khmer Rouge period until the factory

was finally shut in the late 1990s. He is now employed as a security guard on the

factory gate.

"If the factory was to re-open, the farmers could get work again," he says.

"Since it closed the people have encountered many difficulties - not just farmers

but workers too."

Doeun has heard that several investors were interested in the factory, but so far

has seen no results. What he does know is that there is still demand for jute bags,

rather than their plastic equivalent, in the local market.

Whether that demand exists in Cambodia and beyond will determine just how interested

the investors truly are. And that in turn will decide whether Len Sarom, Chhan Than

and their neighbors along the Sangke River outside Battambang will be able to re-plant

their abandoned fields.

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