Cambodia's main rice related news concerns the governments' emergency loan, which (it seems) is not so urgently required. Or are we missing something? The Phnom Penh Post (Feb. 17):
'With the Kingdom’s main rice harvesting season wrapping up, just a fraction of a government emergency loan package that aimed at giving millers the liquidity they needed to purchase rice paddy during the harvest cycle has been disbursed, leaving the government and private sector divided on why.Kao Thach, chief executive of the Rural Development Bank (RDB), the government-owned bank that was entrusted last September with disbursing $27 million in low-interest loans to millers, said only five loans were issued due to a lack of demand. He said that despite rice millers claiming to be suffering financial difficulties, few seemed genuinely interested in obtaining the bank’s low-interest credit lines....Hun Lak, president of the Cambodia Rice Federation (CRF), said the loans given to the millers, though small, were helpful to those who requested them. He added that it will be necessary to have similar packages available every harvesting season if Cambodia is to reach its target of exporting 1 million tonnes of rice annually.The problem, he declared, was that the loans arrived too late in the season for millers to fully utilise them.“The emergency loan was not made available at the right time to be best used by the whole rice sector as currently millers face low prices and smaller demand,” Lak said. “If millers cannot find buyers, they will not be able to borrow the money, which requires interest payments.”
'Why have millers who called for emergency loans not used the funds the government made available through the RDB?Some millers have already accessed the $27 million in loans to buy paddy from farmers, but a lot have not been able to apply for loans because they have not had the storage facilities to qualify. Because the rice loans are linked to storage collateral, they have been really slow to be used, because everybody has the same constraints'.
Likewise from the region there's not so much to mention.
As always Thailand is concerned about their position as top rice exporter. The Bangkok Post (Mar. 3):
'Thailand continued to lag behind India in terms of rice exports in January due to long holidays during the month. Charoen Laothamatas, president of the Thai Rice Exporters Association, said Thai rice shipments totalled 823,401 tonnes worth 12.3 billion baht (US$346 million) in January, down 19.7% by volume and 20.7% by value year-on-year, he said'.
'In order to compete with the Thais, Vietnamese exporters have had to lower the selling prices. However, they would incur losses because the domestic price is on the rise.This means that low prices won’t be the ‘weapon’ for Vietnam to compete with Thailand in the world market, especially in Africa and China, which favor low-cost products.Huynh The Nang, chair of the Vietnam Food Association (VFA), commented that Vietnam has to cede its market share to Thailand in some markets which have demand for white rice because it cannot compete with Thailand in prices....In the context of slow sales, experts believe that Vietnam would rather gather strength to compete with rivals in the high-end market segment. China, South Korea, Singapore and the EU have high demand for high-end products'.
'The Ministry of Agriculture and Forestry has set this year's target for dry season rice production lower after the country's rice farmers failed to meet last year's mark.
Large numbers of rice farmers, especially those in the northern parts of the country, have shifted to growing small commercial crops and their export as they can spend less initial investment capital and get higher yields which lead to better profits and requires less water as well.
Rice planting requires higher capital initially and can have large water requirements but also receives lower production on average than most other commercial crops.
However, the ministry can not confirm why rice farmers' output in Laos has tended to trend downwards as the ministry says that it has not yet studied the issue in detail.
Authorities have also deemed rice fields in the northern provinces unsuitable for expansion of irrigation systems as the yield is lower and, therefore, so is the return on investment'.
'The Legal Execution Department can now seize assets worth 20 billion baht from former commerce minister Boonsong Teriyapirom and five others in the allegedly bogus rice sale scheme during the Yingluck Shinawatra government, says permanent secretary for commerce'.
'Cambodian farmers continue to expand cassava cultivation despite falling commercial prices for the crop and low international trade volumes, new data from the Ministry of Agriculture show.The total area of cassava cultivation grew 34 percent last year, with the starchy tuber planted on 771,000 hectares nationwide, compared to 574,000 hectares the year before.Sok Vanna, deputy director of the department of industrial crops in the Ministry of Agriculture, said it was a bit of a mystery as to why farmers continue to expand cassava cultivation while complaining that it is an unprofitable crop....Farmers have long complained of the crop’s price volatility and a general decline in international market prices. The price of dried cassava has fallen about 50 percent over the last two years to around 400 riel per kilo.Yang Phirom, a business adviser for Cambodian Centre for Study and Development in Agriculture (CEDAC), said that efforts to shift farmers away from cassava have been hindered by their lack of confidence in viable alternative crops. However, he said farmers could secure better prices for their crops if they received support to help them avoid dealing with middlemen.“Cassava cultivation has become habitual even if there is not a good market because farmers do not see that they have any other option,” he said'.
'Orange farmer Say Samoeurth has been battling an invisible foe. He rarely sees his adversary, a tiny insect known as the Asian citrus psyllid, but wherever it goes this winged pest leaves behind a trail of destruction.Most of the 1,000 orange trees that Samoeurth planted on his 2-hectare farm have been affected, with a bacteria transmitted by the sap-sucking insect stunting their growth and causing their leaves to turn colour and fall off. Some of defoliated trees still bear fruit, but its green, mottled appearance and bitter flavour prevents its sale in the market.Samoeurth, who has been growing oranges on his land since 1996, said he first learned of the link between the psyllid and “citrus greening disease” from government agriculture officials. But no solutions were offered, and their advice was simply to cut down the orchard and plant something else....Sovanmony [director of Battambang’s provincial agriculture department]said some small farmers had given up on oranges and switched to other fruit cash crops, such as mangoes and longans. But the high profit potential of oranges – with farmers able to rake in over $20,000 from the harvest of one hectare of healthy trees – had tempted many farmers whose fields were ravaged by citrus greening disease to re-plant oranges.“We know that it is profitable, but it is not a long-term investment and farmers will face high risk as the disease continues to spread,” he said'.
'The government is seeking intrepid smallholder farmers to pilot a project that would transform 6,000 hectares of cropland in two provinces into a patchwork of small rubber plantations.The Ministry of Agriculture is eyeing 5,000 hectares of land in Ratanakkiri and 1,000 hectares in Battambang for the project, and has already secured interest from thousands of smallholder farmers, according to Pol Sopha, general director of the ministry’s rubber development department.“In the first step, we identified 2,500 farming families in two provinces, Battambang, Ratanakkiri, who were willing to invest in growing rubber and ready to convert their land from crop farms to rubber plantations,” he said yesterday.The ministry is currently preparing a feasibility study on the substitute crop project....The government’s push for smallholder rubber plantations comes as rubber prices show a bounce after a five-year global supply glut that depressed prices. The price for natural rubber recently topped $2,400 per tonne, making the cash crop profitable once again, according to Sopha [Pol Sopha, general director of the ministry’s rubber development department].Cambodia currently has more than 430,000 hectares of rubber plantations, the majority of which are large-scale projects on economic land concessions (ELCs). Smallholder farms cultivate rubber on about 150,000 hectares.Sopha estimates that another 300,000 hectares could be brought under cultivation.Heng Sreng, director of Cambodian rubber producer Long Sreng International, which has over 5,000 hectares of rubber under cultivation in Kampong Cham province, cast doubt on the wisdom of the project, arguing that rubber was a cash crop better suited for large producers that can leverage economies of scale. He said smallholder farmers would be better off investing in crops such as mango or longan, which offer higher returns.He said a farmer could earn $10,000 profit per year from a hectare of mangoes, compared to $4,500 per year from rubber and with far less risk.“Rubber is not a priority for smallholder farmers as its market is volatile and producers remains dependant on other countries because there are no rubber factories here,” he added'.
More agricultural notes from the region, starting off with northern neighbour, Laos.
The Vientiane Times (Feb. 11) has some trade news which seems to be more an intention: there are no certifications of origin, probably meant to ease Vietnamese investment in agricultural processing in the country or better said making Laos a cheap source of agricultural profit for their eastern neighbor.
'Unprocessed Lao farm products raised and grown by farmers and Vietnamese investors in the 10 Lao provinces that share a border with Vietnam will enjoy tariff and value-added tax exemptions when exported to Vietnam.The Lao Ministry of Agriculture and Forestry recently issued an announcement detailing the new policy under the Border Trade Agreement, which the Lao and Vietnamese governments have signed in a move to increase the volume of border trade'.
'Five companies with banana plantations in Xayaboury province have been ordered to stop growing the fruit, but can still plant other replacement crops in compliance with regulations.Four of the companies affected are Chinese backed with banana farms located around the villages of Phonthong, Namtuan, Naluam and Nalae, with one Lao farm located at Vangkham village, all in Phieng and Xayaboury districts, Xayaboury province.Some companies are now being instructed to remove banana trees from the farms after authorities ordered a suspension of operations after inspections revealed they were not complying with regulations.Head of Xayaboury Agricultural and Cooperative Promotion Sector, MsSengthongPhengdee told Vientiane Times yesterday local authorities have ordered the five target companies to stop planting banana trees and remove them on more than 600 hectares in Phieng and Xayaboury districts. This follows an executive order from the Prime Minister's Office issued at the end of last year....Bokeo authorities also plan to suspend the operations of 18 companies who have invested in banana plantations. The cultivation of about 6,000 hectares of banana trees by 23 companies in Oudomxay province will also be suspended.According to investment statistics, Chinese companies have invested in more than 764 projects in Laos at a cost of more than US$7 billion in areas such as mineral products, agriculture, electricity, artefacts, and tourism. Of these projects, 552 were funded by Chinese companies, while Laos and China jointly invested in 212 projects. China is Laos' top source of foreign investment. The total value of imports and exports from Laos to China exceeded US$1.5 billion over the last nine months of 2015-16. Of this figure, the export value totalled US$950 million, while imports were valued at US$570 million'.
'Some Chinese investors plan to shutter their banana farms in Laos and relocate to other countries while others plan to replace the yellow herbaceous fruit with other agricultural crops after sustaining losses.It seems that if Laos labour is too expensive at a few dollars a day, then labourers elsewhere in Southeast Asia are even being handed a more harsher deal ... Kudos to authorities taking action, even a little late.
Technical adviser to Chinese banana farms in Bokeo province, Mr Ruan Shui Jin spoke to Vientiane Times on the occasion of the China Chamber of Commerce Fujian Branch in Laos meeting in the Golden Triangle Special Economic Zone recently.
Mr Ruan said operators were attracted to Laos because it is proximity to China.
Available land in Laos was suitable in terms of size, quality and value for money.
However, many have not been able to turn a suitable profit due to labour supply and related cost issues.
According to a Bokeo provincial authority report issued recently, Chinese investors have been operating banana farms in the province for more than five years.
In 2015 about 11,000 hectares were under cultivation for bananas. Currently just over 8,000 hectares are under cultivation by 43 companies, mainly in Huayxai and Tonpheung districts.
The area has been reduced because the operations of some banana farms have been suspended with some now growing oranges, pumpkins and mangoes instead.
More than 500 hectares of such land is now using fertiliser made from natural ingredients.
However, Bokeo provincial authorities plan to suspend the operations of 18 companies who have invested in banana plantations after inspections revealed they were not complying with the regulations agreed to.
According to the regulations and policy on banana farming investment in Bokeo province, the crop may not be grown in rice fields or close to schools or communities.
Its cultivation is prohibited in areas that are adjacent to the source of waterways, while the use of chemicals is also limited.
Last year, the Prime Minister's Office ordered farms that were preparing to cultivate banana trees to cease work.
Companies that own thousands of hectares of banana plantations where trees have already been planted will not be allowed to plant any more suckers after harvesting the current crop'.
More control. According to Bangkok Post (Feb. 17):
Oddly though, much of the chemicals banned are not imports ...'The Department of Agriculture wants to control the use of agricultural chemicals, including those on its watch list, raising hopes of increased food safety....The law also limits imports of harmful chemicals or allows for the import of safer substitutes'.