Tuesday, July 4, 2017

Double


The best news on rice production in Cambodia may well be from an official news source, the Agence Kampuchea Presse (Jun. 5):
'Demand for organic rice is on the upturn both in domestic and international markets, according to local media report.
The report examined the trend grounding on positive performance of a leading local non-governmental organisation known as CEDAC – Cambodian Centre for Study and Development in Agriculture – that promotes organic rice growing and exports.
CEDAC Executive Director Mr. Sam Vitou was quoted claiming that his organisation has so far purchased almost 5,000 tons of organic rice from farmers – the amount that doubles last year, thanks to the increasing demand for the product.
According to the executive director, the increase has been driven by both local and international markets; and the current biggest markets for the organic rice are the United States of America and Hong Kong of China.
Inspired by the trend, CEDAC is expected to encourage some 2,500 farmer households in ten provinces of Cambodia to produce 12,000 tons of organic rice for 2017-2018.
The exporting organic rice, emphasised the source, undergoes standardised technical testing for harmful chemical substances in order to guarantee the product quality among the customers'.
Meanwhile officialdom is still in a quandary as to what to call Cambodian rice. Or better said, how to market Cambodian rice produce. The Khmer Times (Jun. 5):
'Government task forces will meet this week to finalise a single brand under which Cambodian rice will be exported.
Those at the meeting will include the Cambodia Rice Federation, the Agriculture Ministry and the Commerce Ministry.
“We don’t know when the exact date for registration will be because they just applied for registration last week,” said Op Rady, director of the intellectual property rights department of the Ministry of Commerce.
“We have talked several times. The CRF wants to use the name Angkor Malis but the Agriculture Ministry suggested it reconsider the name.
Hean Vanhan, director-general the general directorate of agriculture, said registration of a single rice brand was the duty of the commerce ministry.
Agriculture officials said Cambodia had more than 10 varieties of fragrant rice, and should not single out one as a single brand.
...
He suggested that a non-specific ‘Angkor Rice,’ with the specific variety written underneath would help clear up the confusion and prevent people from thinking they were buying a specific rice variety when they might be buying a different premium rice'.
Rice storage means good. The Khmer Times (Jun. 7):
'Rice millers can expect a certain degree of price stability in their exports with the construction of a 200,000-tonne capacity rice warehouse and a 3,000-tonne silo facility in Battambang province'.
But is the following still good? The Phnom Penh Post (Jul. 3):
'A proposal for a massive warehouse and silo that has attracted two Chinese investors aims to fill the Kingdom’s conspicuous gap in paddy rice storage capacity, which still falls 60 percent short of the level needed for the country to achieve its goal of 1 million tonnes of annual rice exports.
Private Chinese firms Jilin Province Investment Group Co Ltd and Jilin Tianzhong Agriculture Development Co Ltd signed a memorandum of understanding on Thursday with local conglomerate Soma Group to build a “huge” storage facility to serve Cambodia’s rice producers.
According to Hun Lak, vice president of the Cambodia Rice Federation, the companies will conduct a feasibility study to determine the location and investment size of the initial storage complex, with Battambang and Takeo provinces favoured. Additional storage facilities could be developed in other areas, he said'.
And then some news on how international donors keep the ball rolling. The Cambodia Daily (Jun. 21):
'A World Bank subsidiary will soon start training 2,000 farmers contracted to supply a leading Cambodian rice exporter on how to meet an international farming standard.
The International Finance Corporation will work with Amru Rice over three years to implement the U.N.-led Sustainable Rice Platform (SRP) in Kompong Cham province, the two organizations announced on Tuesday in a statement.
Farmers will be scored on 46 criteria, including record keeping, seed variety, pesticide choice, water management and the use of child labor.
Hean Vanhorn, deputy director-general at the Agriculture Ministry, said it was the first time the standard was being introduced to the sector, and explained that the project could help contract farmers market their paddy rice'.
Bird conservation and dry season rice cropping. A very interesting article though the obvious outcome may well be depressing. Conservation.com (Jun. 20):
'I’d been in Cambodia six weeks, and this was one of the last villages left to survey. I was researching the impact of local communities’ livelihoods on a critically endangered bustard species; the Bengal florican (Houbaropsis bengalensis). Fewer than 1,500 florican remain globally, over 60% of which seasonally reside in the grasslands of Kampong Thom province, central Cambodia.
Male florican are distinctive. If you’re lucky, between February and April you may spy their beautiful black and white bodies leaping 30 metres into the air; performing to impress shy females. However, opportunities for encountering such moments are increasingly rare. In recent decades florican have undergone dramatic population declines, initially driven by over-hunting, but now by widespread habitat loss, primarily due to rice cultivation.
...
It was believed dry season rice was typically grown between December and March. However, my interviews revealed that nearly half of all dry season rice farmers now farm two crops of rice a year, extending the rice cultivation season into June. This is a relatively recent and previously undocumented trend, with significant implications for florican, who visit grasslands from February to July. Expansion of dry season rice not only means less habitat is available for floricans to forage and breed, but it also reduces the time for which it is available. Floricans return to the same large territories each year to mate. This means the miniscule populations that remain are likely returning to increasingly sub-optimal habitat.
In addition, around 95% of the dry season rice farmers I spoke to said that they use fertiliser or pesticides on their crop. Many have to borrow money in order to do so, and sometimes if their crops fail or the market collapses, they may find themselves indebted to credit lenders, forced to sell land to clear their debts. There are also considerable environmental and ecological implications. Agro-chemicals not only reduce food availability, but they typically include substances banned in the West, including DDT, a chemical known to cause egg thinning in birds'.
Peace
Thailand is in the throes of the aftermath of the democratically endorsed and highly popular rice pledging scheme, which current junta uses as a stick to thrash it's democratic predecessor. The Asian Correspondent (Jun. 28):
'IN an editorial this week, Bangkok-based daily The Nation issued a crucial reminder to the country – let cooler heads prevail when the curtains close on Yingluck Shinawatra’s rice subsidy case.
The popular English-language broadsheet’s editors said the outcome of the case, whichever way it goes, has the potential of turning what they described as a period of “suspenseful peace” into one of major uproar'.
Oddly it ends the article thus:
'The only way to avoid turmoil and this “vicious cycle” of unrest, they said, is by calmly looking at evidence from both sides with open minds before passing judgment'.
As if the Thai judiciary normally functions differently.

The Bangkok Post (Jul. 1) mentions on-subject:
'The Public Sector Anti-Corruption Commission (PACC) has pushed forward with its investigation into allegations of corruption in the rice-pledging scheme by inviting for questioning suspects in five cases, the PACC chief says'.
Meanwhile the old crop is getting sold. Bangkok Post (Jun. 7):
'The National Rice Policy Committee has approved the 16.56-billion-baht sale of 1.66 million tonnes of old rice to auction winners, leaving only 160,000 tonnes of edible rice in the stockpile.
...
Since the May 2014 coup, the military government has sold more than 14 million tonnes of old rice by auction, fetching about 130 billion baht. The Commerce Ministry plans to call for bids for old rice fit for animal feed this month, and for ethyl alcohol production next month'.
What this means for the market. The Bangkok Post (Jun 20):
'With state rice stockpiles nearly sold off and major rice-producing nations suffering bad weather, Thai rice exports are likely to hit a record high this year, say government and industry officials.
Thailand's 2017 rice exports are tipped to reach 11 million tonnes, the most ever, because of rising demand in rice-importing countries at a time that production in grower countries is falling.
...
But Thai rice supply is limited because of the 2016 drought and the government's policy to encourage farmers to switch to other lucrative crops such as sugar, which has substantially cut supply from the off-season crop dropped by more than 40% from 9-10 million tonnes on average over the past few years to just 5 million tonnes this year, according to data supplied by the Agriculture Ministry'.
So what does the current regime plan? The Bangkok Post (Jun. 28):
'The cabinet yesterday approved a rice insurance scheme for the first crop of the 2017 season, worth 2 billion baht.
...
The government expects the scheme to cover 25-30 million rai of rice farmland. The scheme covers six natural disasters: floods, drought, storms, cold, hail and fires'.
Foreign good
Over to Vietnam. Vietnam has it's own problems concerned with marketing their rice produce. Vietnamnet (Jun. 12):
'According to VIBIZ, the market research and analysis website owned by Global Yoilo JSC, 64 percent of rice in the domestic market is Vietnamese but is labeled as foreign rice so that sellers can make higher profits.
Meanwhile, 53 percent of consumers say they like foreign rice grown in Thailand, Cambodia and Japan.
A report of the company said of the 67 rice products in the domestic market, only 21 products are given Vietnamese names.
...
“Vietnamese prefer foreign rice because they hear Thai and Japanese farmers grow rice with high technologies,” he [Nguyen Van Nam, a renowned economist, and former head of the Trade Research Institute] explained. “They have no information about how rice is grown in Vietnam.”
“Therefore, merchants give foreign names to Vietnam’s rice to sell more products,” he said, adding that Vietnam only imports rice from Cambodia and Thailand in small quantities.
Tran Duy Quy, former head of the Institute of Agricultural Genetics of Vietnam, confirmed that Vietnam has been importing rice from Cambodia and Thailand, but in small quantities. As for the so called ‘Japanese rice’, this is Vietnam’s rice labeled as Japanese rice'.
Vietnam is trying to free up it's export process. Vietnamnet (Jun 21):
'The decree, replacing Decree 109/2010/NĐ-CP on rice export and business, is expected to take effect from January 1, 2018, after which businesses will be able to engage in the free trade of rice without quantitative restrictions.
The decree also removes regulations of criteria for businesses to be eligible to export rice, as well as the floor prices set for rice shipments.
...
Vo Minh Khai, director-general of Vien Phu Organic – Healthy Food Company from the southernmost province of Ca Mau, said that over the past years, rice enterprises that were small scale but produced high-quality rice had not been able to bring their products to the world market.
To export their rice, they had to depend on large companies as intermediaries. Therefore, revising the old decree would create a level-playing field for small rice export firms to proactively access the global market, Khai said.
The new document will also enable businesses to invest in producing high-quality products to compete with rivals from Thailand and Cambodia, he added'.
Likewise, the Hanoi Times (Jun. 24) reports on rice prices looking better:
'According to the Ministry of Industry and Trade, the demand for Vietnam’s 5 percent broken rice, has been rising, hitting 390 USD per tonne in the early days of June, against 360 USD per tonne to 380 USD per tonne in late May'.
Even without the dam future, Vietnam seems already to be vexed by Mekong upstream efforts which means less water in the delta. Vietnamnet (Jun. 20):
'According to Nguyen Nhan Quang, a river basin management expert, Thailand has had 990 more projects in the northeast on using Mekong’s water to serve irrigation in the area.
In Cambodia, the strategy on stepping up rice cultivation for export is being implemented, with the country seeking cooperation with foreign countries, mostly from China, to expand the irrigation network.In Laos, the current total irrigation area is 166,476 hectares, but the figure is expected to increase by 213,062 hectares by 2030.
As upstream countries try to expand water use, this will be a great challenge for Vietnam’s Mekong Delta'.
Into the deep
From the Phnom Penh Post (Jun. 21), an article about the downward trend for pepper growers:
'The rapid expansion of pepper cultivation in Cambodia coincides with the spice’s plummeting world prices, creating concerns that the glut of pepper ripening on vines across the Kingdom could further erode next season’s market prices and push the sector toward a collapse. Hean Vanhan, undersecretary of the Ministry of Agriculture, said large-scale planting in recent years, encouraged by the soaring prices, has significantly boosted Cambodia’s pepper production. He said total production doubled last year and has increased eight-fold since 2013, with the impact on supply magnified by similar output growth in other major pepper producing countries.
“According to our figures, the growth of pepper production has increased dramatically, but now the big concern for farmers is that the market has stagnated,” he said yesterday.
Ministry data show total pepper production rose to 20,054 tonnes this year, compared to 11,819 tonnes in 2016, and just 2,498 tonnes in 2013. More than 5,000 hectares are now cultivated with pepper, compared to just 400 hectares in 2013.
...
Rothsan [Var Rothsan, adviser to the Ministry of Commerce] added that the ministry was also working on developing a new collective trademark for Cambodian pepper aimed at raising the profile of locally produced, non-GI pepper in international markets – a move that could help reduce the reliance on Vietnamese brokers to access these markets.
...
Yin Sopha, executive director for Memot Dar Pepper Agriculture Development Cooperative, said the domestic farm-gate price of black pepper had fallen to $3.5 per kilo, well below the 2014 high tide mark of $10.5 per kilo. He added that the decline was driving farmers deep into debt'.
Cassava has also all the entrapment's associated with lower prices. The Phnom Penh Post (Jun. 27):
'Cassava prices in Cambodia experienced a sharp drop this month leading to heavy losses for smallholder farmers unable to quickly switch to more profitable crops and recoup their mounting losses, a provincial agriculture official said yesterday.
Faced with low prices of around 144 riel ($0.035) per kilo of fresh cassava at the beginning of the harvest season, which runs from December to April, farmers decided to delay collecting the starchy tuber, only to see prices plummet to a historical low of 108 riel ($0.026) per kilo earlier this month, explained Soy Sopath, agricultural director for Pailin province at the Ministry of Agriculture.
With a breakeven point of 180 riel ($0.044) for fresh cassava, the farmer’s fate went from bad to worse as they are now forced to sell their products at a large loss, he said.
...
Cassava, which is considered to be a cash crop in Cambodia as it is rarely consumed by locals, is popular to grow as it requires less water and fertilisers, and is less prone to disease than other crops, Sopath explained. The government has made numerous attempts to wean Cambodian farmers away from cassava, yet its cultivation continues to expand.
“Farmers keep harvesting cassava because it is not a complicated crop to grow, and its price might increase next season,” he said.
However, falling prices have seen a decline in cultivation in Pailin province, the heartland of cassava cultivation where 90 percent of farmers are involved in the sector. Total cultivation in the province decreased 20 percent this season compared to last, according to Sopath, who said he expected further decline as farmers look to other more profitable crops.
...
However, Soeng Sophary, spokesperson for the Ministry of Commerce, explained that the Ministry of Agriculture and farmers needed to work together to collect and share information in order to better understand price trends in foreign markets so that farmers could time cassava cultivation to satisfy external demand.
“If farmers and agriculture officials cooperate and work smartly to find the right time for cultivation then they would not suffer from such heavy losses,” she said. “In order to add value to cassava, we need to have better quality standards and more technical expertise for processing it in factories.”
But not all alternatives are in the doldrums. The Phnom Penh Post (Jun. 7) reports on coconut oil.
'The Kingdom’s nascent coconut oil industry is facing a shortage of raw materials as local farmers look to make a quick profit by selling young coconuts to drink vendors rather than letting them mature and sell them to health care and cosmetics producers.
Khdib Sreymich, general manager of Coco Khmer, a Cambodia-based producer of virgin coconut oil, which also manufactures a line of coconut-based health and beauty products, said her company is forced to import coconuts from Vietnamese suppliers to meet consumer demand for the company’s products. She explained that the farmers preferred to sell the coconuts when they were young, though mature fruits, which can be sold for higher prices, are needed for coconut oil production.
According to Sreymich, domestic production can only satisfy 10 percent of the company’s demand for mature coconuts. The remaining 90 percent must be imported from Vietnam'.
And then corn. The Phnom Penh Post (Jun. 22):
'Growing demand for animal feed is driving up both the demand and price of corn, with smallholder farmers claiming the field crop offers a more stable market than cassava.
“If we look at the trends in farming, this sector [corn] has a lot more options than other crops, and is less challenging,” said Lor Reaksmey, spokesman of the Ministry of Agriculture. He added that corn, also known as maize, is needed for food consumption and animal feed mills, with high demand both in the domestic and international markets.
Corn is grown on more than 140,000 hectares in Cambodia and can be harvested twice a year, with the main areas of cultivation being Battambang, Preah Vihear and Kandal provinces. Each hectare yields about 4.5 tonnes, putting Cambodia’s total production at around 640,000 tonnes last year.
Reaksmey explained that over 60 percent of domestically produced corn is earmarked for export, with most of these shipments destined for feed mills in Thailand and Vietnam. The remainder is sold to the Kingdom’s feed mills, with a small amount purchased by local food-processing plants and retailers.
...
Ministry of Agriculture data shows total corn exports reached 70,487 tonnes last year, a 25 percent increase over 2015.
Despite this rise, local production cannot satisfy the voracious appetite of the Kingdom’s 15 feed mills, said Hort Pheng, director of the Industrial Affairs Department at the Ministry of Industry and Handicrafts'.
A Chinese agrofair in Phnom Penh. Phnom Penh Post (Jun. 29):
'A major international agricultural fair that brought over 800 Chinese companies to the capital wrapped up yesterday with none of the expected investment agreements signed as Chinese investors appeared cautious about setting up agro-processing facilities in the Kingdom, organisers said.
The inaugural International Agriculture Products and Expository kicked off on June 25, drawing some 800 investors from China and 200 local firms to a four-day expo aimed at showcasing the investment potential of Cambodia’s agricultural sector.
Chea Heng, president of the Cambodia-China Development Friendship Alliance (CCDFA), one the expo’s local organisers, said several major memoranda of understanding (MoUs) had been expected during the fair, but none materialised'.
Expiration date
We've focused earlier on the banana growing rage from China which has set up shop in Laos and northern Thailand. The Vientiane Times (Jun. 10) notes that banana growing is going out of fashion as the land leasers are being held to account:
'A number of banana farms in Oudomxay province have ceased operations after their contracts expired following numerous complaints from local residents that their operations were negatively affecting the environment.
The farms are operated by 11 concession holders. Seven companies are still continuing their operations but four companies’ contracts have expired and the authorities will not renew them.
A provincial Agriculture and Forestry Department official, Mr Bounyeun Xayyaven told Vientiane Times yesterday the 11 companies had concessions and rented the land of local residents to operate their banana farms, but four of those companies had ended their work after their contracts expired.
...
According to a National Assembly report in October last year, some provinces are using too many insecticides, pesticides and chemical fertilisers, but this issue did not feature in reports submitted to the Assembly.
Some people became ill and some allegedly died after pesticide was sprayed on farms, but the reports did not say where this had occurred'.

Monday, June 5, 2017

Drenching

A short article to set us off. Previously highlighted here, it appears the EU are abating there strictness. Phnom Penh Post (May 31):
'Producers of white rice will have until September to meet the revised threshold level of 0.01 milligrams of Tricyclazole residue per kilo of rice, far below the current limit of 1 milligram per kilo, it said.
The previous deadline for white rice exports was June, while the December deadline for jasmine rice exports remains unchanged'.
It coincides with a recent article in Le Monde (May 29), which highlights how another chemical, atrazine, forbidden in the EU since 2004, still sees substantial production in the same EU with exports heading for countries with less scruples / less legislation. It cites the Swiss organisation Public Eye which in a recent report highlighted exports from Switzerland, France and Italy. On Switzerland: 
'Switzerland is exporting atrazine and paraquat to developing countries. The use of these herbicides, made by the Swiss-based Syngenta, has been banned in Switzerland due to their extreme toxicity'.
And though we're drifting off-topic, I would add the following article on banana growing in Laos. Often quoted, Reuters decided to make a write up. Excerptions of which are from VOA (May 11):
'Experts say the Chinese have brought jobs and higher wages to northern Laos, but have also drenched plantations with pesticides and other chemicals.
...
Under the "Belt and Road" plan, China has sought to persuade neighbors to open their markets to Chinese investors. For villagers like Kongkaew, that meant a trade-off.
"Chinese investment has given us a better quality of life. We eat better, we live better," Kongkaew said.
But neither he nor his neighbors will work on the plantations, or venture near them during spraying. They have stopped fishing in the nearby river, fearing it is polluted by chemical run-off from the nearby banana plantation.
...
Several Chinese plantation owners and managers expressed frustration at the government ban, which forbids them from growing bananas after their leases expire.
They said the use of chemicals was necessary, and disagreed that workers were falling ill because of them.
"If you want to farm, you have to use fertilizers and pesticides," said Wu Yaqiang, a site manager at a plantation owned by Jiangong Agriculture, one of the largest Chinese banana growers in Laos.
...
Hmong and Khmu workers douse the growing plants with pesticides and kill weeds with herbicides such as paraquat. Paraquat is banned by the European Union and other countries including Laos, and it has been phased out in China.
The bananas are also dunked in fungicides to preserve them for their journey to China'.
It just shows hoe the lack of a conscience is the underlying business rule with the large-scale agrochemical industry.

Stealth
With a slight upswing in the rice market, it comes as no surprise that the Phnom Penh Post (May 18) reports that big brother may well be interested in a bigger part of Cambodia's rice pie:
'China has agreed to increase its import quota for Cambodian rice to 300,000 tonnes by next year, Prime Minister Hun Sen announced yesterday following his return from Beijing where he attended the Belt and Road initiative summit'.
However the Khmer Times (Jun. 2) reports on the downsides on neighbouring actions:
'Cambodian rice millers and exporters are strongly concerned that Thailand’s plan to release 4.32 million tonnes of state rice stocks by September, driven by a sharp surge in global rice demand, could depress prices of the vital grain on commodity markets. “When Thailand sells such a large part of its stockpile on the open market it will have a knock-on effect on prices and in turn also affect the price of Cambodian milled rice exports,” Hun Lak, vice president of the Cambodia Rice Federation, told Khmer Times'.
The same source (Khmer Times, Jun. 5) also delves the depths of the marketing strategy of Cambodia's rice future:
'Government task forces will meet this week to finalise a single brand under which Cambodian rice will be exported.
...
Hean Vanhan, director-general of the general directorate of agriculture, said registration of a single rice brand was the duty of the commerce ministry. Agriculture officials said Cambodia had more than 10 varieties of fragrant rice, and should not single out one as a single brand.
“The CRF selected ‘Angkor Malis’ as the brand, but this is not right because there is already a rice seed called malis,” Mr Vanhan said.
“What the private sector wants to do is to steal foreign branding to make the rice similar to Thailand, since the Thai Hom Mali is already famous.
“If we use ‘Angkor Malis,’ which is specific only to Cambodian premium rice ‘malis,’ it has a different taste to Cambodian fragrant rice such as phka romduol, phka chansensor and phka khnei.
“If customers buy Angkor Malis one day, it may have a different taste when they buy it in the future, even though it carries the same brand,” Mr Vanhan said.
He suggested that a non-specific ‘Angkor Rice,’ with the specific variety written underneath would help clear up the confusion and prevent people from thinking they were buying a specific rice variety when they might be buying a different premium rice'.
Thai-tening
Regionally it's the Thai who are mostly optimistic. From the Bangkok Post (May 30): 
'World rice prices are expected to rise by US$20 (682 baht) a tonne over the next three months, driven by a sharp surge in global rice demand, according to experts. Global rice supply is now quite tight, while Thailand's previously hefty state rice stocks have eased, releasing pressure on global rice prices, Jeremy Zwinger, chief executive of the Rice Trader, said at the "World Rice Trade Outlook" seminar of Thailand Rice Convention 2017, held in Bangkok yesterday. 
...
Chookiat Ophaswongse, honorary president of the Thai Rice Exporter Association, said lower-than-expected rice production in Vietnam accounts in part for the lower global supply, while Thailand's good-quality rice stocks are about to be depleted.
 
From Vietnam a similar sentiment, though more cautious. The VNexpress (May 12):
'China and several African countries have returned to Vietnam seeking fragrant and white rice, and the demand has helped stabilize export prices even though supply has risen at the end of a major harvest, traders said on Friday'.
The Vientiane Times (May 5) notes that the Lao dry season rice crop may well disappoint slightly.
'This dry season, the department set a target of 95,000 hectares but until now only about 90,000 hectares have been planted out.
Department officials said a large number of farmers were now growing other crops instead, which earned them more money and required less water. The lack of irrigation occurred because provinces did not have sufficient funds to pay for the repair of irrigation systems, according to the Department of Irrigation'.
Thailand is looking to getting rid of the last of it's inventory. The Bangkok Post (May 16):
'The government yesterday called the second auction for 1.82 million tonnes of state-held rice that is fit for human consumption.
...
The government is estimated to hold about 4.82 million tonnes of rice stocks, a sharp drop from the 18.7 million tonnes accumulated during 2011-14. 
... From Jan 1 to May 9, Thailand exported 4.1 million tonnes, up 9% from the same period last year, worth US$1.74 billion (60.1 billion baht), up 6% in value'.
An article from Vietnam.net (May 30) which looks at an interesting study:
'A study conducted by the Institute of Policy and Strategy for Agricultural and Rural Development shows there are nine million rice farming households nationwide, but around 300,000 of them account for the bulk of Vietnam’s rice export volume.
Meanwhile, the nation has over 300,000 rice milling facilities, but a majority of them are small. But in Thailand, there are a mere 1,000 rice milling plants. Besides, Vietnam has around 100 rice exporters, but a mere 22 of them focus on China, one of Vietnam’s largest rice buyers.
Industry experts said these two hindrances had led to the global market share of Vietnamese rice shrinking. Statistics of the Ministry of Agriculture and Rural Development show the country’s rice shipments last year dropped 27% in volume and 23% in value against 2015'.
Meanwhile, a new weapon in the armory of Italy's rice industry hoping to target cheaper rice imports from Cambodia, Burma and potentially Vietnam. From Lexology.com (May 31):
'The Italian government has submitted to Brussels the draft decrees for the introduction of an obligation to indicate the origin of certain the raw materials.16 For rice, the place of cultivation, processing and packaging must be indicated, while for wheat, the place of wheat cultivation and the sowing of the seeds must be indicated. 
...
To try and counter the imports producers have been calling for better labelling of foodstuffs containing rice so as to indicate to consumers the true origin of the raw materials.
The producers hope that consumers will tend to purchase products with Italian rice rather than imported rice'.
It seems more as a message for domestic markets.

Measuring
Organics in Cambodia are poised to be government ruled. The Cambodia Daily (Jun. 1):
'The Agriculture Ministry will soon adopt a national standard for organic vegetable production to create product consistency and a single yardstick for farmers to work toward, according to officials.
A logo that will mark the products as government-approved organics has been designed, and a draft law by which the produce quality will be measured is nearly complete, said Kean Sophea, deputy director of the ministry’s department of horticulture'.
How will this work in practice? I doubt that this label would result in better trust by consumers than any other current logo.

Having access to the world market doesn't necessarily mean a positive. Hard work still needs to be done. The Vientiane Times (May 22):
'Although Laos is enjoying Generalised System of Preferences (GSP) exemption from over 50 nations around the world, the country is still unable to fully benefit from the special treatment.
The Ministry of Industry and Commerce recently described a number of challenges Laos is facing in order to fully benefit from trade privileges.
One of the most important points is that Lao businesses don’t fully understand the true benefits and the various procedures of the scheme.
In the meantime, product quality sometimes does not meet the standard requirements as specified by countries at the final destination. 
In addition, Lao businesses produce agricultural goods in small volumes as they are often family concerns and have not done any market research or studied the GSP'.  
More policy talk. The Phnom Penh Post (May 11):
'Cambodia's agricultural sector must improve post-harvest processing to increase the value of its products, while increased knowledge sharing could help farmers better understand the different value chains and identify opportunities, agricultural experts participating in the Grow Asia Forum said yesterday.
Panellists at the event, hosted by Grow Asia and held on the sidelines of the World Economic Forum (WEF) in Phnom Penh, also said improving farmers’ access to better seeds and inputs, as well as training, would help them to be more productive'.
More policy talk. I think. Phnom Penh Post (Jun. 2):
'Implementation of a previously announced three-year $20 million programme to increase local vegetable and fragrant rice production will begin next month to help boost domestic supply and reduce imports, an agriculture official said yesterday.
The goal of the project is to increase local production of vegetables by 160 tonnes per day and production of 500,000 tonnes of paddy rice a year, Kean Sophea, deputy director of the Department of Horticulture and Subsidiary Crops at the Agricultural Ministry, said'.
And then an article from the Phnom Penh Post (May 19) highlighting how agricultural policy can develop without government fiddling:
'The Kingdom’s leading palm oil producer has projected revenues of $20 million this year as it targets another record-setting year for crude palm oil exports.
“We plan to export over 30,000 metric tonnes of crude palm oil this year, with revenue of approximately $20 million,” Prachak Kongtanomtham, vice president of Mong Reththy Investment Cambodia Oil Palm Co Ltd (MRIC), said yesterday.
MRIC, a joint venture subsidiary of local agro-industrial conglomerate Mong Reththy Group and Thailand’s TCC Group, exported a record 21,450 metric tonnes of crude palm oil in 2016, generating over $13.3 million in revenue, according to Prachak. 
...
About 17,000 hectares of MRIC’s palm oil plantations are harvestable. Two other companies operate commercial palm oil plantations in Cambodia, though only one has matured to harvest.
Malaysian-owned Virtus Green Plantations (Cambodia) operates a palm oil plantation on a portion of its 6,700-hectare economic land concession in Kampot province. 
...
The Kingdom’s other major palm oil plantation is located in Ratanakkiri province, where subsidiaries of Vietnam’s Hoang Anh Gia Lai have planted oil palms on 18,000 hectares. The first harvest is expected by next year'.
Sweetener
The  Bangkok Post (May 24) reports of how Thailand seeks to meet free trade requirements while at the same time manipulating the domestic market:
'Thailand, the world's second-largest sugar exporter, is introducing regulations to govern its sugar trading system for the 2017-18 crop, which commences in November, to bring the system in line with World Trade Organization (WTO) rules.
...
Brazil says Thailand's subsidies for sugar producers had dragged down global prices and allowed Thailand to win a larger market share at the expense of Brazilian producers, conduct that is not in line with international trade agreements.
...

Traders and industry officials said freeing up domestic retail sugar prices could lead to possible sugar shortages, particularly when global sugar prices rise. Traders said sugar production costs in Thailand should be slightly lower than for net sugar importing countries. This could encourage profiteers to smuggle sugar from Thailand to be resold in the neighbouring CLMV countries (Cambodia, Laos,
Myanmar and Vietnam), where sugar prices are around 40% higher than domestic retail prices'.
Also hoping to dampen the local market the Bangkok Post (May 27) reports how stricter food rules will ensure that the domestic consumption will sky-rocket:
'A new bill imposing a maximum of 10% sugar or sweetener content in food products is expected to be passed and come into effect within this year, said the Food and Drug Administration (FDA) yesterday'.
The article also quotes EU regulation of the same subject. Though I doubt whether or not the EU has legislation on the subject, it's  certainly  clear that the EU sugar industry is very much opposed to any levels. Kudos to the Thai on this subject, let's hope it's an effective policy.

Then what an opener market means. The Phnom Penh Post (May 23):
'Cambodia's biggest sugar mill has finished its two-month production run, producing half a million tonnes of refined white sugar, nearly five times what the company predicted at the beginning of the harvest season, a company representative said yesterday.
Kuy Yoeurn, an administrative manager for Rui Feng (Cambodia) International Co Ltd, said the second harvest season of its $360 million sugar plant in Preah Vihear province greatly exceeded the company’s expectations. He said the mill produced 500,000 tonnes of refined sugar from an undisclosed amount of raw sugarcane this season.
...
The Cambodian government granted Rui Feng Cambodia an 8,841-hectare economic land concession (ELC) in 2011. However, the Chinese-owned company and its four sister companies collectively hold five separate ELC licences covering 40,000 hectares.
Rui Feng has faced accusations of land-grabbing and using its partner firms to circumvent restrictions on the maximum legal size of land a company can hold as an ELC.
Nevertheless, Yoeurn said Rui Feng has requested that the Ministry of Agriculture provide the company with more land to expand its cultivation of sugarcane.
“We need to increase our sugarcane cultivation,” he said. “So far, we have already farmed all of our land and it is still not enough. The ministry should provide us with more land for cultivation.”

Thursday, May 4, 2017

Not fit

GRAIN has an important feature on Golden rice, a genetically modified organism which has great institutional support as a variety of rice that through the provision of vitamin A can reach many of those facing a dietary shortage of said vitamin (Wikipedia). 
At the same time it seems claims that this is the golden bullet to vitamin A deficiency seem far-fetched and it can't be discounted that the mass of support received, is tied in with companies seeing that acceptance of Golden rice will open the floodgates to more GMO and hybrids being allowed for consumption.
From GRAIN (Apr. 20):
'Applications for the field testing and direct use of Golden Rice, a genetically modified crop touted as the solution to Vitamin A deficiency, is presently filed and awaiting approval from the Department of Agriculture – Bureau of Plant Industry in the Philippines
Asian peoples’ organizations coming from India, Vietnam, Thailand, Indonesia and the Philippines express deep concern regarding the imminent commercialization of the Golden Rice and other GM crops and its effect to their country’s food security, farmers’ livelihood and environmental health.
...
A recent study made by scientist in India showed that the derived lines of Golden Rice produced phenotypic abnormality and poor agronomic performance making it unfit for commercial cultivation'.
What follows are statements from the many regional partners of GRAIN all equally opposed.

Vetting
Cambodia's rice market is in the doldrums as exports are not adding up. And  the culprit is China, so it seems.  The Phnom Penh Post (Apr. 5):
'Amid concerns that the European Union could reject shipments of Cambodian rice, exporters are pushing for more access to China as an alternative market for the Kingdom’s principal agricultural commodity.
Hun Lak, vice president of the Cambodia Rice Federation (CRF), said just 26 Cambodian millers have satisfied China’s sanitary and phytosanitary (SPS) standards, making them eligible to export rice to the Chinese market.
However, another 55 millers “have the quality and capacity to export to China” and have requested an inspection by China’s AQSIQ (General Administration of Quality Supervision, Inspection and Quarantine) to approve their shipments for export'.
Then the Phnom Penh Post (Apr. 19) drops a hint between the conditions set by China and slowing exports of rice:
'Cambodian rice exports declined dramatically in March, causing the average export growth of the Kingdom’s dominant cash crop to increase by only 3 percent during the first quarter of this year, nearly wiping out the double-digit growth seen in January and February.
According to rice export data released by the Ministry of Agriculture yesterday, Cambodia exported a total of 166,678 tonnes in the first quarter this year, up from 162,220 tonnes during the same period last year. While growth in January and February accelerated greatly by 11 percent and 17 percent respectively, the weighted average was bogged down by a 16 percent year-on-year decline for March exports.
Hun Lak, vice president of the Cambodia Rice Federation (CRF), said yesterday that the March declines can be attributed to stricter sanitary and phytosanitary (SPS) standards being imposed on shipments to China, Cambodia’s second largest market after the European Union.
He added that only 26 Cambodian millers have been granted official approval to export to China with another 55 waiting to be vetted by China’s General Administration of Quality Supervision, Inspection and Quarantine.
“A large amount of the millers that used to export to China in the past are no longer able to export there now,” he said. “If the issue over SPS standards cannot be resolved soon, our export figures will continue to decline and this year will not be good.”
According to Lak, despite CRF lobbying Cambodian authorities to fast-track negotiations with China to allow increased market access, the body has yet to produce tangible results for its members.
...
Song Saran, CEO of Amru Rice, one of the country’s biggest exporters, raised similar concerns about Chinese market access but noted that the Ministry of Commerce (MoC) preemptively submitted a list of only 18 millers, instead of the allotted 26, to China for the current harvest season.
He added that while Amru used to export 7,000 to 8,000 tonnes of rice to China annually in the past, it has yet to be included by the MoC for Chinese clearance.
“Now, we are trying to get into the Chinese market to accelerate our rice exports,” he said, adding that reliance on the EU market had reached a saturation point at about 300,000 tonnes exported annually'.
Cambodia's government's answer from the Cambodia Daily (Apr. 21):
'The Agriculture Ministry is working to have more Cambodian rice exporters permitted to sell in China, as exports to the country have almost doubled in a year, according to government reports.
A statement by the ministry’s general department of agriculture said 26 Cambodian rice companies had so far received permission to export to China, but there were eight others seeking permission who had been denied because they did not mill their own rice. The statement, released on Wednesday, said the ministry’s Chinese counterparts had not responded to requests for increased access'.
The Phnom Penh Post (Apr. 21) reports on the same:
'After Cambodian rice exports declined dramatically in March, caused by what millers claimed was a stricter enforcement of sanitary and phytosanitary (SPS) measures by the Chinese government, the Ministry of Agriculture announced yesterday that it would lobby on the sector’s behalf to allow more millers to be eligible for export.
According to a Facebook post by Hean Vanhan, undersecretary at the Ministry of Agriculture, officials sent a letter to the Chinese government asking for the country to accept rice imports from more than the current 26 that have already been approved. This is the second such letter sent to Chinese officials, according to the ministry.
Vanhan in his post asked millers to understand the difficulties the ministry was facing in reaching an agreement for exports'.
As if this is the only problem faced by rice exports, the other main market for Cambodia's rice, the EU, has also set up a target to be met. The Khmer Times (Apr. 10):
'A senior economist from the Asia Development Bank has warned the EU’s ban of Tricyclazole could damage Cambodia's agriculture sector, as farmers rush to eradicate the use of the fungicide by June.
The strict new limits on pesticides will mean rice exported to the EU must not contain more than 0.01 milligram of the chemical per kilogram of the grain'.
Tricyclazole, a fungicide, is 
'Toxic to aquatic life with long lasting effects'.source
Used to contain rice blast, Cambodia's government is hoping that wishful thinking will contain the residues and will not affect the export of rice to the EU. In all honesty, it has also put some policy in place (Xinhua.net, 28-3) but policy execution remains weak within the Kingdom:
'Cambodia has banned the import of fungicide Tricyclazole after the European Commission required the country's milled rice industry to eradicate the use of the pesticide by June'. 
Verge 
Earlier in the month, the Philippines had been called upon as a potential market. The Cambodia Daily (Apr. 11):
'Prime Minister Hun Sen said on Monday he had urged Philippine President Rodrigo Duterte to invest more heavily in Cambodia’s rice sector, while also acknowledging the need to lower rice processing costs and find new export markets to boost the competitiveness of Cambodia’s most important crop.
 ...
"So I request our farmers to produce good rice seeds and to not use any toxins or poisonous substances that can cause damage and loss of market [access],” Mr. Hun Sen said'.
More from the sidelines. The Phnom Penh Post (Apr. 25):
'Thaneakea Srov (Kampuchea) Plc, the recipient of a low-interest $15 million loan from the state-run Rural Development Bank, inked contracts yesterday with three companies to build and outfit its massive 200,000-tonne capacity silo and warehouse facility in Battambang province.
The facility, which will have an attached mill capable of processing 3,000 tonnes of paddy rice a day, signed a construction agreement with the Cambodian company NGY Investment. It will also purchase machinery from Taiwan’s Agrosun Co Ltd, and Thailand’s International Rice Engineering Co Ltd, according to an announcement by the Rural Development Bank (RDB) yesterday.
Phou Puy, CEO of Thaneakea Srov, said the construction of the facility would begin shortly, with the silo portion expected to be completed by August while the rice mill should be fully operational for the 2018 harvest season.'
And then to wrap up the Cambodian rice news, the consequences of the failing market conditions. The Phnom Penh Post (May 3):
'Numerous members of the Cambodia Rice Federation (CRF), the body tasked with lobbying on the sectors behalf, have stopped paying membership dues and export fees, claiming that they cannot afford to as the industry continues to struggle with high production costs and regional export competition.
According to the terms of CRF membership, each miller is required to pay $200 annually and an export fee of $0.50 per tonne on white rice and $1 per tonne on fragrant rice.
Chray Son, deputy director of Capital Food Cambodia, said that despite the CRF’s efforts to provide relief to its members, the body had achieved little in lobbying the government and instead praised emergency assistance provided by the state-owned Rural Development Bank.
Nevertheless, he added that with monthly losses during the current harvest season amounting to $10,000 to $15,000, CRF fees were exorbitant and exploited millers that were on the verge of bankruptcy'.
Purity
The ongoing discussion of Vietnam's rice export strategy continues. From Vietstock (Apr. 25):
'Vietnam may itself be a major rice producer in the 10-member Asean group but the country also has a taste for the Lao grain.
In 2013, the value of rice exported from Laos to Vietnam reached over US$5.8 million and increased to US$15.5 million by last year, according to the Ministry of Industry and Commerce.
...
In addition, Laos plans to produce about five million tonnes of rice by 2020 to ensure food security in the country.
However, the country is importing rice from Thailand for trading.
The Ministry of Agriculture and Forestry this year expects to export about 400,000 tonnes of rice and hopes the figure will climb to one million tonnes by 2020.
The focus will be on specialty varieties including black rice, kaynoi rice, and hom rice.
New and improved varieties such as thadokkham, thasano, phonngam and hom are also in demand across the region.
The ministry plans to increase yields so that white rice accounts for about 30 percent of the total rice crop and is certified with the Good Agriculture Practice (GAP) standard for export.
...
This year, Xuanye (Lao) Co., Ltd is targeting the export of 20,000 tonnes of rice to China.
In 2015, Xuanye (Lao) Co., Ltd was approved by China’s National Development and Reform Commission to be as yet the sole exporter of rice from Laos to China with a quota of 8,000 tonnes.
Laos was unable to meet the deal and was only able to export some 4,000 tonnes of rice including sticky rice and non-glutinous rice.
The Chinese company also ordered 7,200 tonnes of rice last year but producers were unable to supply this amount.
In 2015 and 2016, the country could supply only 5,000 tonnes of rice to China.
This was because the standard required by the Chinese buyers was really high, the Ministry of Industry and Commerce reported'.
The same, more or less from Vietnamnetbridge (Apr. 2):
'Nguyen Do Anh Tuan, director of the Institute for Policy and Strategy for Agriculture and Rural Development, commented that many Vietnamese now don’t eat Vietnam-made rice, priced at just VND10,000 per kilo. The rice products are just for export, not for domestic consumption.
..
While Vietnam focuses on making high-yield and low-cost rice, more and more Vietnamese only want high-quality products. The choosy consumers accept to pay higher prices to buy delicious rice from Thailand, Japan and Cambodia.
An analyst said Vietnamese people’s income has improved, so they have become choosier about rice price.
“They don’t need much rice; they need high-quality rice,” he commented'.
It's therefore surprising that Bayer are launching hybrid rice with the export market as it's focus. On their own website they report (Apr. 15) on
'... a special event to celebrate the launch of its revolutionary hybrid rice seed variety - Arize Tej Vang'.
It claims:
'“Vietnam is currently the world’s No.2 country in rice export, and there is a continuing need to sustainably increase the nation’s production capacity with better rice seeds so that the country can maintain and even improve its export position in the market. By using Arize Tej Vang, Vietnamese rice farmers can look to achieve higher yields and better grain quality with 7.1mm grain length, and this is proven especially when compared to open-pollinated varieties. Arize Tej Vang will contribute to better yield security and enhanced productivity, which will in turn help to secure the incomes of smallholder farmers in Vietnam,” added Sakata [Kohei Sakata, Managing Director of Bayer Vietnam].
With a grain length of 7.1mm, with a grain of rice when processing fragrant, soft and disease resistance BLB, Arize Tej Vang has the potential to compete with the current high quality purebred rice varieties and to improve the quality of Vietnamese rice exports'.
So the argument is for more quality whereas what Bayer-VN have on offer is more lower quality grain. It's claim that it has better quality than open-pollinated varieties seems shaky; as hybrid rice in the past has often been of much lower quality. 
What is very disturbing is the suggestion that exporting hybrid rice is the way forward. With consumers worldwide being sceptic towards hybrid rice the possibility of hybrid rice getting mixed with other rice varieties may well cost Vietnam dear.
 
Break
Surprisingly the tightening of the rubber market is continuing, partially due to Southeast Asian countries willing to step into the market. From the Bangkok Post (Apr. 23):
'Thailand, Malaysia and Indonesia are cooperating to ensure stability of world rubber prices, which continue to fluctuate after signs of recovery. 
... 
They agreed that rubber prices will continue to rise because of several factors, including lower supply due to heavy rainfall and flooding in the South of Thailand. However, the big players in the natural rubber industry see prices as still volatile'. 
Naturally this has also resulted in an upswing for rubber in Cambodia (Phnom Penh Post, Apr. 27)
'Cambodian rubber exports increased 32 percent during the first three months of the year compared with the same period last year, while prices grew 132 percent during the first quarter, an agriculture official said yesterday.
The Kingdom exported 32,000 tonnes of rubber in the first quarter of 2017 with average prices reaching $2,032 per tonne, compared to $890 in the first quarter of 2016, according to Pol Sopha, general director of the General Directorate for rubber at the Ministry of Agriculture.
“We already surpassed the break-even point for rubber and I think that rubber producers will be able to accumulate profit and increase their yields for the next production cycle,” he said. “We project that rubber prices will continue to increase this year due to the increasing demand from the international market.”
...
Heng Sreng, director of local rubber firm Long Sreng International, said the industry also faced the challenge of high logistic costs for transportation and electricity costs for production.
“We are faced with the high cost of production, and that is our biggest challenge,” he said. “Compared to neighbouring countries, they provide better tax incentives to allow the sector to survive.”'
More good news for farmers in Cambodia, cashew prices are also on the up. The Phnom Penh Post (May 4):
'International commodity prices for cashew nuts are rapidly increasing due to lower supply from Cambodia and Vietnam which is driving up profits for the Kingdom’s farmers, according to industry stakeholders.
The shortfalls of cashew supply into the global market have decreased by around 40 percent this quarter due to lower production in Cambodia and Vietnam, although demand has not diminished. 
...
Chhiv Ngy, director of the Cashew Nut Association of Kampong Thom, said that the current market for cashew nuts greatly benefited the country’s farmers, pushing their revenues to $10,000 per hectare.
“The cashew nut market is doing great and we have a lot of buyers coming to buy directly from us,” he said, adding that the association was comprised of around 4,000 farmers'.
Blooming
Wrapping up, two linkages to articles touching on rural development in the region.
In Lao, there's some sound bytes on organics. The Vientiane Times (Apr. 21):
'Expanding clean agriculture production to supply market demands together with improved international market access can serve to catalyse growth in the Lao organic produce sector, an audience including the Minister of Agriculture and Forestry was told yesterday.
...
Mr Vilaysouk [Director General of Department of Agriculture, Ministry of Agriculture and Forestry] noted registration of 39 companies and farmer groups with 2,785 families under the relevant organic agricultural registration scheme.
The current area dedicated to growing the organic agricultural is around 7,984 hectares, covering the capital and the provinces of Vientiane, Luang Prabang, Xieng Khuang, Oudomxay, Savannakhet, Champassak and Xayaboury, with yield estimated at 3,375 tonnes per year.
Meanwhile, the members of the Lao GAP now number some 15 farmer groups with more than 500 families, and area for GAP is around 1,400 hectares, in the capital and the provinces of Vientiane, Khammuan, Savannakhet and Champassak.
Vientiane organic agriculture group has several distribution venues across the city.
That Luang village in Xaysettha district hosts organic markets Wednesday and Saturday mornings weekly.
A similar range of produce can be found at Fa Ngum Park in Sikhottabong district, every Monday and Thursday afternoons and at Huayhong Market in Chanthabouly district every Saturday morning'. 
While in Cambodia, fish deaths close to a sugar mill are left un-explained. The
Phnom Penh Post (Apr. 7):
'Experts from the Institute of Standards of Cambodia (ISC) inspected Chinese-owned Rui Feng sugar company’s factory this week after suspicions that its runoff had caused last month’s mass fish deaths in Preah Vihear.
ISC director Chan Borin said yesterday that their team launched an investigation that lasted for two days as the factory was suspected by the local community of releasing waste into the Stung Sen River.
The factory, however, was found to have its own reservoir for waste storage, so the team went to the river for further investigation.
“We measured and tested the oxygen at the site and we figured that the water lacks oxygen, [so] the fish could not breathe and died . . . The level of oxygen is very low,” Borin said.
He added that the sugarcane waste would not have caused oxygen shortage as the “fish in the [waste] reservoir were alive”.
He suspected that plant decay had led to algal blooms, which deprive the river of oxygen'.