Safety first

Cambodia should go ahead and allow GMO to be grown. So captions the Khmer Times (Sep. 8). It is a strange and let's say awkward article. 
The article is authored by Gabrielle Ward and John Humphreys both of the Professional Research Institute for Management and Economics (PRIME). Apparently a newcomer on the scene, the institute announces itself as:

'The Professional Research Institute for Management and Economics (PRIME) is an independent teaching and research institute that operates in Phnom Penh (Cambodia) and produces research reports, opinion polling, translation, commentary, events, and short courses on a range of topics'.

Their opinions that they want to share with us concerning GMO legislation in Cambodia:

'Unfortunately, despite growing food production, poverty and malnutrition persist among the rural population. One solution is the use of GMO crops, which have the potential to further boost food production. But, international pressure, scaremongering, and limited capital for investment, prevent the uptake of GMO crops in Cambodia. This holds back potential rice yields of farmers and the efficiency of production.

... 

The health and safety of GMOs has been extensively studied. In polls of scientists about the public safety of genetically modified foods, an overwhelming majority insist that GMOs are safe for human consumption. Most food consumed in OECD countries such as the United States and Australia is genetically modified.

...

There will inevitably remain a demand for non-GMO rice, especially for export, but that doesn’t justify the introduction of new regulation. The technology to increase production and lower food prices already exists, and it is incumbant on the Cambodian government to allow the industry to explore all new opportunities -- including GMO -- without the burden of government restrictions. Pandering to misguided and ill-informed anti-GMO protesters will hurt the Cambodian agriculture industry and punish the poorest 15 percent of Cambodia who continue to suffer from malnutrition'.   

Unfortunately the authors seem to be drawing lines between unrelated dots.
Introduction of GMO's has no impact (negative nor positive) on poverty and / or malnutrition among the rural poor. 
Rice yields can be easily boosted by higher prices, not by introducing GMO's.
Cambodia's rice industry is increasingly being dominated by being a niche player in rice with it's jasmine rice increasingly being sought after. 
Most food consumed has GMO's in OECD countries? Not so in Japan / Korea and Europe. 
Doing away with any regulation in the food industry is like opening up Pandora's box, once liberated there's no way of stepping back. 

Easy

No big export deals for Cambodia (Phnom Penh Post, Sep. 10) in the wanting, that's if the government can't make exports any cheaper ...:

'The Philippines’ National Food Authority (NFA) yesterday authorised the import of 750,000 tonnes of rice and has invited the governments of Cambodia, Thailand and Vietnam to join the bidding process to fill the quota, according to a report from Reuters.

But having already lost out twice in the past 12 months, Heang Vutha, director general of Green Trade, said the new tender, which has set a closing date on bids of September 17, is too soon to expect costs to have come down to the point where Cambodia can compete.

...

However, Song Saran, CEO of Amru Rice Company, said that Cambodia could still be competitive in the bidding process if the government was willing to share in some loses and offer incentives to private exporters, through tax cuts, low-interest loans, lower electricity fees or transportation cost reduction.

“It is a good opportunity for Cambodia to open the market there again, to show about our quality rice” he said'.

The Cambodian situation of growing many different rice varieties makes branding difficult, (Phnom Penh Post, Sep. 2): 

'The Agriculture Ministry and the Cambodia Rice Federation (CRF) are at odds over the branding of Cambodia’s premium jasmine rice that would help differentiate it from similar varieties sold by Thailand.

The CRF is working on a new brand name that it hopes will help distinguish Cambodian rice in the international market.

The national rice body wants to bring all varieties of jasmine rice under an umbrella brand name that it plans to announce at the Cambodia Rice Forum in November.

“We have set up the market promotion executive committee for naming the quality rice as the trademark, because so far our rice is just known as fragrant rice, because we do not have a specific name,” the CRF’s acting secretary-general Moul Sarith said.

Sarith said that inconsistent labelling of Cambodian rice among exporters was diminishing the collective strength of the rice sector.

Cambodia’s jasmine rice can be grown from multiple varieties of seeds, including Phka Romdeng, Phka Romeat, and the Kingdom’s distinguished variety, Phka Rumduol – a long-grain, aromatic type of rice and named after Cambodia’s national flower.

Phka Rumduol rice variety has been awarded the world’s best rice at the last three annual World Rice Conferences.

But the Ministry of Agriculture has already zeroed in on “Cambodia Jasmine Phka Rumduol” as the sole brand name for Cambodian rice.

“I would like to urge all rice exporters to use this name from now on,” said Hean Vanhorn, deputy director general at the General Department for Agriculture at the ministry.

“I know some rice exporters do not dare to use this name, but we need to change that.”

However, selecting a brand name based only on one variety of fragrant rice would confuse buyers, said Song Saran, CEO of Amru Rice and CRF member.

He added that when buyers would test the rice they would expect it to be Phka Rumduol, but in actuality it could be either of the other varieties used in Cambodian farming'.

The Khmer Times (Sep. 18) notes that exports of rice are up by just under 50% so far this year.

Phnom Penh Post (Sep. 4) notes that millers are asking for tax exemption:

'As Cambodia continues to struggle with its cost competitiveness in the rice sector, rice millers and exporters met with the General Department of Taxation on Wednesday asking for an exemption from paying the 10 per cent value added tax (VAT), saying that it will help ease prices in the sector'.

An article in the Phnom Penh Post (Sep. 12) discusses how the rise of Burma's economy may well spell problems for Cambodia as it seems Burma has more ability to offer lower prices for it's produce as well as better logistics.

Then in a more or less related issue, facing opposition from mostly Italian farmers, the EU's commissar for Trade defends the deals for zero duty from amongst others Cambodia and Burma (Oryza, Sep 1). 
And though the assurance went some way to addressing Italian concerns farmers groups still note that the exemption stimulates unfair competition and that the profits fall to multinationals rather than poorer farmers. But maybe it was intended to stimulate their economies ...?

With prices determining rural development outcome, the prices for export of rice are continuing their downwards trend (Oryza, Sep. 3) despite USDA predicting lower production and year on year amounts of rice stocks declining by more than 10% on an annual basis in their recent Rice Outlook.

Quandary

More rice news, this time from the wider region.

More needs for focusing on niche markets for rice as this article from Vietnamnet (Sep. 11) shows:

'For Vietnamese rice, the situation is not better. Nguyen Duc Thanh, Director of the Institute for the Vietnam Economic Research and Policy (VERP), said the rice market of Vietnam is increasingly dependent on China.

Vietnam is losing its traditional markets. Meanwhile, Thailand is diversifying the market with quality products so it takes footsteps in every market, from picky ones like the US, Japan, Europe, and China to less choosy markets like Africa.

"The problems of the Vietnamese rice market are: difficulty seeking markets for high quality rice; unable to build rice brands for Vietnam; rice price in the domestic market dependent on export prices; and lack of cooperation among local rice traders and exporters,” Thanh said.

Professor Vo Tong Xuan, a senior expert in agriculture, said that while Vietnam’s rice exports fell in both volume and value, Cambodia's rice exports in the last eight months of 2015 increased by 50% compared to the same period of 2014. Cambodian rice is exported to picky markets like China, France and some European countries.

To promote its rice, Cambodia launched a large-scale marketing program. It participated in all international rice fairs held in Thailand while Vietnam was absent. They not only brought rice samples for customers to see and taste but also offered a price and signed contracts on the spot'.

Funny how they actually are envious of Cambodia. 

Continuing on this subject, Vietnamnet (Sep. 16) looks at the problems of it's domestic exporters and hopes to see a solution for this quandary:

'According to data from the World Food Organization (FAO) in 2015, the export prices of Pakistan’s Basmati rice and Thailand’s jasmine rice were above $1,000 per ton in 2012-2015.  At the same time, 5% broken rice of Vietnam has never reached the price of $500/ton'.

Solution:

'Therefore, the problem of building a Vietnamese rice brand is more urgent than ever'.

So more branding needs?

Ban
Meanwhile in Thailand ...

Desperate times require desperate measures? With lower than hoped for rains, Thailand has actually banned growing rice, so reports the Bangkok Post (Sep. 12).

'Ministries in charge of government projects must also be instructed to hire farmers so they have some income.

The ban means rice farmers would not be able to grow rice for most of the 2015 crop year.

This involves 870,000 rai that have not been farmed and the 15 million rai on which planting will be banned'.

The ban would come into place after November 1 so adds the Nation (Sep. 14), thus not affecting current plantings.

The practice (Nation, Sep. 17): 

'According to an informed source, the Agriculture Ministry was planning to ask the Cabinet to close down water gates and pump stations across the country to stop farmers from pumping water into their farms as soon as the dry season started on November 1'.

The above precedes to what Bangkok Post (Aug. 30) names a call to arms, but that seems to be farmers debt:

'Farmers’ debts have become so severe and chronic that every government in recent memory has been forced to make it a priority.

... farmers are often left not only at the mercy of the rain, or lack of it, but also at the whims of loan sharks.

...

Farmers might be happy to see a higher rice price, albeit unrealistically, but the scheme was a double-edged sword because it encouraged farmers to increase the quantity while placing a lower priority on the quality of their rice'.

Their answers: education, formation of cooperatives, creation of value addition and fairer input systems. Will it happen?

Sweet

A more scientific report on Indonesia's agriculture from the New Mandala website (Sep. 1). It notes that oil palm plantations are not really paying off in terms of rural development.

'Food policy is about much more than growing rice: it requires helping the poor access food'. the article looks in depth at how the policies encouraging large scale oil plantations are actually effecting poorer farmers negatively.
...

Plantations are yet to offer a pathway out of poverty on their own, and new programs need to help poor farmers upgrade into oil palm or other profitable crops.

...

Enabling vulnerable farmers stuck in rural poverty to use their own land more effectively continues to be critical.  Land may offer an essential safety net when no other is available – until effective social safety nets are rolled out and farmers can find well paid off farm work.

Food insecurity at the household level poses prickly land and livelihood dilemmas. Determined efforts to understand and to address such local dilemmas will provide hope to Indonesia’s rural poor'.

One reason why developing palm oil plantations is not paying off is the price of palm oil. These are in the doldrums. In Thailand (Bangkok Post, Sep. 15) notes that farmers want a fair price: one that meets their costs. The call came in response to the government lowering their intervention price as it was leading to an oversupply encouraging smuggling.

Other opportunities? One of those opportunities may well be sugar to China (Bangkok Post, Sep. 3), at least in the near future:

'Dry weather and a decline in sugarcane planting means China next season will produce its least amount of sweetener in a decade'.

And though prices are at a low at the moment the prospect is for more Thai sugar to hit the Chinese market at much better prices.

Policy

With drought conditions disappearing (and thus discussions on potential insurance), the focus of the regional rice industry is now well and truly on coping with floods. 

Burma, so notes the Bangkok Post (Aug. 14), will  discontinue exports of rice so as ensure domestic prices will remain affordable:

'Myanmar halted rice shipments after floods over the past month inundated farmland, raising the specter of supply disruptions in the sixth-biggest exporter.

...

Declining supply from Myanmar may help boost global rice prices by about $10 a tonne, said Kiattisak Kanlayasirivat, a Bangkok-based director at Ascend Commodities SA, which trades about 500,000 tonnes of rice annually. Any impact may be limited as other exporters such as Thailand can fill the market, said Samarendu Mohanty, head of the social sciences division at the Los Banos, Philippine-based International Rice Research Institute.

Thai 5% broken white rice, a regional benchmark, has dropped 9.8% this year to $377 a tonne'.

If anything the past has learnt that knee-jerk reactions to weather conditions is not the way to go. How come the Burmese government failed to take measures to store rice when the going was good?

The Vientiane Times (Aug. 17) notes that recent flooding will have some impact on harvests. And suggests the same measures as in Burma. Vientiane Times (Aug. 14) :

'Lao economists have warned the relevant sectors of the government to prepare measures for augmenting the rice supply next year after farmers around the country have been badly affected by drought and then flooding during this wet season.

The late arrival of the rains this year forced some farmers, especially those without access to irrigation systems, to delay the planting of their rice crop and this was followed by thousands of hectares of planted rice being destroyed by flooding from the frequent heavy rains in the last few weeks.

This could lead to a shortage of rice in the country next year and a rise in pricing, a senior economist from the National Economic Research Institute, Dr Leeber Leebouapao, has said.

...

The cost of rice in Vientiane markets is currently showing a slight rise of 2-3 percent over normal levels the Vientiane Foodstuff state enterprise Director, Mr Khamla Saengdara, told Vientiane Times yesterday.

The current rice price is around 70,000-90,000 kip per 12 kg bag, which is considered a stable price.

“We still have a surplus of rice for consumption and sufficient to supply market demand for the present because a lot of farmers have stored their paddy rice after harvesting last time,” he said.

Different rice traders are also bringing polished rice for sale after they bought it for stockpiling when the price was low at the beginning of the year.

Mr Khamla commented that he would be happy if a price increase meant that the farmers benefited because that would help to promote more rice growing but the main beneficiaries are the middlemen or rice traders who take any opportunity to raise pricing by themselves when there is a shortage of supply'.

It's not often that this insight is voiced ...

In Cambodia the impact of flooding on potential rice harvests is yet to be assessed. The Phnom Penh Post (Aug. 6):

'On Tuesday, the Ministry of Water Resources and Meteorology called on several provinces, including Stung Treng, Kratie and Kampong Cham, to harvest crops quickly as increased rainfall causes levels to rise dangerously high along many of the country’s main waterways'.

But

The national positives are that exports from Cambodia are way up. The Khmer Times (Aug. 8):

'For the first seven months of 2015, Cambodia has exported some 312,317 tons of milled rice to international markets, up 53.1 percent if compared with the same period last year, pointed out a report of the Secretariat of One Window Service for Rice Export Formality'.

Then some cash is thrown at the problems. Cambodian Daily (Jul. 28):

'The Cambodian Rice Federation (CRF) signed a memorandum of understanding with the Ministry of Commerce on Thursday to receive $450,000 in financial support from the government to increase Cambodia’s rice exports, according to a federation official'.

The negatives are that not all what's planned is not going as expected. The Phnom Penh Post (Jul. 29):

'A project to build 10 warehouses to store rice paddy using Chinese funding has hit a roadblock, as the Cambodian government has been unable to meet criteria set by the Chinese for the project, according to an official associated with the project'.

And more bad news from China. Khmer Times (Aug. 13):

'Cambodia’s need to secure China as a rice export destination is becoming increasingly urgent, with China’s multiple pending agreements with other countries in Southeast and South Asia, said industry insider David Van. 

China recently signed a deal with Thailand for 1 million tons of rice, with another million in a pending agreement before the end of the year, according to Mr. Van, a senior advisor with the Bower Group. He added China would also sign a deal with Laos for 300,000 tons. It also plans to import more non-Basmati rice from India. 

“We have tougher competition for the China market,” Mr. Van told Khmer Times. “As the Chinese vice president stated candidly earlier this year at the last China-GMS meeting, Cambodian rice is too expensive and still relatively ‘unknown.’”

And finally the EU are dealing trade issues with Vietnam. Possible outcome may be that EU entry for Vietnamese rice will become easier. This may well mean bad news for Cambodia. The Phnom Penh Post (Jul. 27):

'Under the proposed EU-Vietnam Bilateral Free Trade Agreement (EU-V BFTA), the EU may import around 76,000 tonnes of rice, mostly husked and milled, from Vietnam at zero per cent duty, according to Oryza, an industry publication.

...

Currently, the European Union (EU) imports rice and other products duty-free from least developed countries under the Everything But Arms policy.

Of the rice exports to the EU under this policy, Cambodia accounts for 22 per cent and Myanmar three per cent.

If Cambodia needs to maintain or increase the 250,000 tonnes its exports to the EU, Saran [president of Amru Rice] said it will have to improve its production capacity and logistical services to remain competitive.

...

Independent economist Srey Chanthy said that despite tough competition from Vietnam, Cambodia could increase focus on the niche market of fragrant rice – a variety that is not grown in Vietnam currently'.

Credible

Despite in the past having undertaken thorough inspections of the various standards of the rice pledging scheme of the previous Thai government, an upcoming auction of sub-standard rice (The Nation, Jul. 27) was annulled:

'Commerce Ministry has delayed the auction date for inferior rice in its stockpile, from the end of this month to next month, allowing more time for officials to conduct a thorough survey and separate quality grains from inferior ones'.

Meanwhile, some sales are ongoing. The Bangkok Post (Aug. 12):

'The government has sold 426,977 tonnes of rice worth 6.29 billion baht in its latest auction.

...

Since Prime Minister Prayut Chan-o-cha took office, the Commerce Ministry has held nine auctions including five this year in order to speed up disposal of 18 million tonnes of state stocks accumulated from rice-pledging schemes. It has sold 4.4 million tonnes for 48.6 billion baht.

However, the government has fetched an average of only 10,000 baht per tonne of milled rice from the auctions, far below the 24,000 baht a tonne spent by the previous government for pledging excluding management costs and interest rates'.

Though that may be the case, one has to see where the losses went, for a large part in the pockets of farmers ...

Answers to  possible loss of markets?  Bangkok Post (Aug. 7):

'Thailand Development Research Institute (TDRI) fellows are urging the government to establish a Rice Market Development Institute to enhance scientific research, disseminate credible information to farmers and entrepreneurs and improve the competitiveness of Thai rice cultivation'.

Then in Laos they are looking to change rice growing altogether. The Vientiane Times (Aug. 13):

'The Naphok Agricultural Research Centre is seeking to produce early maturing varieties of rice seed for Lao farmers to plant in the coming years, as part of efforts to reduce the disaster related impacts of climate change.

Researchers at the centre are currently conducting ongoing research into some 400-500 lines of rice varieties in order to produce the earlier maturing varieties, according to Mr Nikhom Chantheva, one of the rice researchers.

The rice seeds which are currently being produced by Lao farmers take about 120-130 days before harvesting is possible, while with the new rice seeds, harvesting will be possible after only 90-95 days, he said'.

However as there is still a lot of subsistence rice been grown in Laos, there might just be little takers.

Unmatched

Most of the forthcoming stems from Laos, a country with more diverse agriculture? 

The Vientiane Times reports (Aug. 19) on environmental issues taken in the province of Oudomxay directed at banana growers. It notes that so far no studies have been undertaken so there's no complete picture of what environmental harm is done. But nonetheless the measures will be put into place in order to improve the supposed damage. It also notes:

'There are more than 600 hectares of banana plantations within the province, most of the crop being exported to China, while Luang Namtha and Bokeo provinces are also affected by the same problem.

Last year, Laos exported over 260,000 tonnes of bananas and received payment of about US$45 million according to the Ministry of Agriculture and Forestry.

China offers a large market for the northern provinces so provincial authorities have agreed to allow Chinese companies to invest in various crops for sale to China, including cassava, watermelons, pumpkins and chillies'.

Vientiane Times (Aug. 10) notes the slump in rubber prices.

'Speaking to Vientiane Times last week, a senior analyst in the agriculture and forestry sector, Dr Palikone Thalongsengchanh, said the drop in price will have a lesser impact on companies and investors who planted a large number of rubber trees as they operate with a view to the long term.

They are more likely to survive the slump as they have sufficient capital to tide them over a temporary drop in the market price. They also have more markets available to them.

The greatest impact will be on small growers who planted just a few hectares on their farms and have limited financial resources, Dr Palikone said'.

That seems to contradict reality, where it's often small holders who have a diverse crop production who will wait for prices to rise warranty sufficient returns for labour required solely for harvest. It's often the larger scale of often not well thought through investors who will step out of the industry altogether.

Desperate times ahead? Lao authorities are mulling a cashew plantation. With cashew growing mostly tied up by the Vietnamese and prices often under opportunity costs it beats me why they would they be contemplating 10,000 ha cashew plantation? As reported by Vientiane Times (Aug. 14):

'Champassak province is aiming to plant 10,000 hectares of cashew trees from now until 2020 to ensure an adequate supply for domestic sale and export'.

It's a strange article implying that on the one hand Laos exports to Vietnam but at the same time there seems to be imports of cashew required. Maybe processing is the better way to move forward?

An insight to growing coffee in Laos. Vientiane Times (Aug. 10):

'The Lao Coffee Association has called for the government to provide better promotional policies so that Lao products are more widely recognised in international markets.

The Lao government is currently preparing growers and producers for membership in the International Coffee Organisation (ICO) but there are still many conditions to be met.

...

Coffee exports generated more than US$70 million last year along with indirect income generated by tourism in coffee growing areas.

According to a report from the Ministry of Agriculture and Forestry, the total coffee growing area in Laos is about 83,495 hectares while the area harvested last year was more than 60,000 hectares.

Total coffee output last year was 98,200 tonnes, an increase of 8 percent compared to the plan for the year.

....

“If we are accepted as an ICO member, we must also provide monthly reports of coffee exports to ICO and address the fact that the current export figures recorded by various government ministries do not match each other,” he [Lao coffee Association President Mr Sinouk Sisombat] added'. 

Dead Wood

Ambitions

Lagging world market upward price moves have stalled the ambitions of Cambodian rice exporters, so it seems. At least for the mean time. 

The Khmertimes (Jun. 28) notes how all the goals for massive exports of rice from Cambodia have not and / or will not be achieved.

'Cambodia’s ambitious goal of exporting one million tons of rice this year has been quietly dropped. A follow-up export goal of 600,000 tons also is falling by the wayside.

Undermining these goals is the reality of the rice paddies: labor emigration to Thailand, high costs for milling, and spreading bankruptcies among small rice farmers. This is the view of two experts affiliated with the Cambodia Rice Federation, the leading industry group'.

One tell-tale sign is the inability of Cambodia to compete. Phnom Penh Post (Jun. 23):

'Following Cambodia’s loss of a hefty Filipino rice tender to Vietnam last week, industry insiders say logistics and production costs are hampering the competitiveness of the Kingdom’s rice exports.

Cambodia lost a 100,000-tonne tender for the fourth time running after its final price of $455.50 per tonne came in way higher than the Vietnamese company’s final $416.85 per tonne deal, itself only marginally lower than Thailand’s $417'.

How does the government take the news?

'Mey Kalyan, senior adviser to the Supreme National Economic Council, said the government was working on improving transport and further “rationalising” the rice sector by focusing on higher-margin varieties, such as jasmine rice.

Although agreeing that export costs were high compared to region, Kalyan said the loss of the Filipino rice tender was in large part due to the Phillippine’s traditional reliance on Vietnam for large quantities of cheap rice.

Kalyan added that stubborn global rice prices – which have not budged significantly since the global commodity boom ended in 2008 – further held back profitability.

“The prices are stable, but the cost is higher.”

In fact rice exports from Cambodia to Europe are stable at least based on annual figures. The Phnom Penh Post (Jun. 20) compares these with those from Burma which seems to see surges in exports to the EU. Their exports are now just 10% behind those of Cambodia.

Briefed

The Phnom Penh Post reports (May 28) on unethical rice trading and how the Cambodian government is seeking to crack down on these practices.

'The Ministry of Commerce (MoC) is ramping up its efforts to stamp out “unethical” rice exporters mixing their produce with rice from neighbouring countries, as the European Union becomes increasingly concerned about rice tampering.

In an open letter issued on May 11 the ministry said it will stop issuing Certificates of Origin to exporters found to be using non-Cambodian rice, as this could lead to the European Union withdrawing its duty-free trade preferences that Cambodia enjoys under the Everything But Arms agreement.

...

“MOC will have a group of inspectors who will launch surprise inspections in rice exporting companies and rice millers to investigate the issue,” the letter added'.

A big surprise (Phnom Penh Post, May 29):

'The long-awaited Agricultural Extension Policy, rolled out yesterday by the Agriculture Ministry, will focus on making up-to-date knowledge and technology accessible to farming communities and increase efficiency and productivity in the sector'.

Going by evidence of other countries in the region having no extension service means savings in national expenditure while the perceived public goods supposed to be dispensed are all too often seriously lacking. Or the extension service itself is a government run business preying on farmers ...

'At least 2,000 additional agricultural-extension specialists will be needed to fill the gaps in human capital. Currently, there are only 70 agricultural-extension officers at the national level and less than 1,000 at the provincial level, Soeun said'.

Creating another base for bureaucracy, cleptocracy and vote buying. Cambodia is better off without a formal extension service.

Mekong Oryzae has an opinion article on their website. The May 25 published piece is from Riza Bernabe who is the policy coordinator and Maya Quirino, the media, advocacy and communications lead, both of Oxfam’s GROW campaign in East Asia. 

In the article they argue that climate change is undermining the viability of the current agricultural system which they say depends to a large amount on small scale farmers often reliant on small areas of riceland for their survival. It then notes evidence of the change and it's possible effects. What to do?

'ASEAN must duplicate sustainable agriculture and agro-ecology practices across the region. One such program is Systems of Rice Intensification (SRI), which optimizes harvests without depleting soil nutrients, and uses rice varieties that can withstand floods or droughts. SRI is already gaining ground in Cambodia, Vietnam and the Philippines. Women, who are also food producers, must be included in these programs. Women are often mistakenly not counted as economic actors, and are therefore left out of development projects'.

Pity that not more is made of possibilities to adapt to changing climate. Floods seem fine enough, certainly as they come with increased fertility afterwards. Droughts though call for different directions. Water storage? Irrigation? No mention is made of either ... 

The current El Niño weather patterns will contribute to more drought conditions, certainly in the upcoming rice season. However the rice industry seems to think that expected lower production will not make much difference in the short term for prices (Bangkok Post, May 27):

'The "price is weak short term, in three to six months, because of Thai stocks and competition among major exporters," The Rice Trader's Mr Zwinger said in an interview on May 21. "The market today is more concerned on Thai stocks than El Nino."

The weather spells more problems as farmers expect assistance in face of adversity. Bangkok Post (Jun. 29):

'Farmer leaders have slammed the government for not doing enough to help farmers as the drought crisis continues to hit several provinces nationwide, increasing pressure on the "backbone of the country"already struggling with debt'.

Meanwhile Thai authorities are hoping to sell a fair share of their stocks of rice. The Bangkok Post (Jun. 6):

'The government plans to call bids for another 2.6 million tonnes of high-quality rice from state stocks between now and August while transferring low-quality and substandard grains to the industrial sector'. 

They also note that exports are down by nearly 10% this year ...

On the 5th of June (Bangkok Post) the Thai government (slash army) decided how to rid itself of unwanted grain:

'The Thai government may sell most of its stockpiled rice to ethanol and animal-feed producers because it's no longer fit for human consumption'.

Basically it means going to the dogs ...

More losses

In the roundup of Cambodia's other agricultural news we first start with looking at turning cassava into electricity. I doubt whether with current energy prices this makes sense, but obviously investors are making different calculations. Phnom Penh Post (Jun. 3):

'A planned biomass plant run on cassava in Battambang province looks ever more likely after a trial period with 100 farmers was successfully completed.

Idemitsu Oil and Gas signed a memorandum of understanding (MoU) with the Ministry of Agriculture, Forestry and Fisheries and the Cambodia Mine Action Centre (CMAC) in 2012 to explore the development of biofuels in Cambodia'.

They seemed to have done their homework.

Other investor news (Phnom Penh Post, Jun. 1):

'Tokyo-based conglomerate All Nippon Airways Trading (ANA) is in talks with the Mong Reththy Group (MRG), to establish a banana plantation with plans to export to Japan, the Cambodian agriculture tycoon said on Friday'.

A great alternative (Phnom Penh Post, Jun. 25):

'Exports of Kampong Speu palm sugar with geographical indication status increased sharply this year thanks to growing demand from South Korea and France, according to a representative of the Kampong Speu Palm Sugar Promotion Association’s (KSPSPA).

According to KSPSPA president Sam Saroeun, exports of Kampong Speu palm sugar reached 75 tonnes this year, an increase of 50 per cent compared to the same period last year'.

In other developments blame biofuel growing for power politics resulting in loss of access to agricultural land. The Phnom Penh Post (Jun. 6):

'Houy Mai has lost everything to the global demand for cheap sugar and biofuel. The 54-year-old mother-of-eight has fought a years-long battle with Mitr Phol, Asia’s biggest sugar producer and one of three major suppliers to Coca-Cola.

... 

In March, the government issued a decree that cancelled Mitr Phol’s concessions, covering about 20,000 hectares – almost two times the legal limit.

...

But the area now swarms with soldiers who have taken over numerous sawmills

...

Three of these large sawmills were operating last week, with soldiers lounging in hammocks aside towering piles of sawn lumber, waiting for military trucks to arrive at night and cart the precious wood to a drop-off point near the border, from where NGOs Action Aid and Oxfam allege it is smuggled into Thailand and processed into sleepers for railroad construction'.

The article tells the familiar tales of woes of how farmers are left (literally) in the gutter. Not even hope. A very insightful article.

Going analog

And then this to worry about.

Basically it's going to the dogs as they say ...

 

It looks like rice but it's not. Jakarta Post (May 31):

'... analog rice was a food commodity that looked like normal rice but was made from all kinds of tubers, making it suitable and safe for consumption

...

The INDEF economist said a number of parties had reportedly attempted to hamper the development of analog rice as they were concerned the newly discovered staple food would disrupt consumers’ dependence on rice.

“Once analog rice enters markets, people’s dependency on rice will be disrupted. This poses a challenge to certain parties. With the current synthetic rice issue, people are really worried. What happens now is that people cannot differentiate between synthetic rice and analog rice,” said Enny.

She said once the synthetic rice issue contaminated the mindset of consumers, it would be difficult for researchers or any parties supporting the development of analog rice to introduce their discovery to the people.

“In such situations, people will just keep it in their minds that analog rice is not ‘original’ rice. They will not pay attention to whether or not analog rice is suitable and safe for consumption,” said Enny'.

It seems to be a very Indonesian issue, little is known beyond the archipelago.

Hypocritical

I could spend a huge amount of this blog on the on-goings in Thailand: rational analysis, past present and future. But I am not.

Much of what has played out in the last few weeks in Thailand concerning rice pledging and political scheming was to be expected. Government is weak and has problems continuing programme: the dèja vu! It's all great when you start the rice pledge programme, but it's like a drug: there's no way you can stop. without tears that is.

So yesterday, Thai farmers were in arms, today it's believed they might get their pay, so they are back on the land. Thai government corrupt? Oh no! Not again!

Despite the good years, it's odd to see how fast some farmers are to switch their allegiance ...

Well what else is there to report about?

Rules, my a**?

We could start off by looking at how Cambodia is struggling to market it's rice. The Phnom Penh Post (Feb. 17) reports on stringent rules concerning providence of it's rice export so as to prove to Europe that yes indeed it is Cambodia produce.

'Exporters requesting a certificate of origin from the Ministry of Commerce will be required to show proof through invoices and receipts that the rice is local.

An audit committee consisting of both industry and non-industry representatives is tasked with investigating claims of fraud.

Penalties include the permanent revocation of an exporter’s certificate of origin, which strips the business of duty-free access to Cambodia’s largest market'. 

If this were to happen, the cost of exporting Cambodian rice just got more expensive and wrought with administration, yea! Note that David Van in a comment says it's bollocks, there is no need for a certificate. So article wrong?

Earlier this month (Feb. 4) the Phnom Penh Post had a re-cap / re-hash on the story. 

Italy seems to be lobbying for denying no-tariff imports for Cambodian rice. It's unfair to Italian farmers. This despite the fact that Italy produces different rice and hardly any note-worthy exports from Cambodia. Reaction:

'David Van [there he is], deputy-secretary general for the Alliance of Rice Producers and Exporters of Cambodia, said in an email yesterday that it was hypocritical of the Italian government to claim developing countries were receiving unfair subsidies, as European countries have long benefited from similar EU deals'. 

Trouble is that the importing country sets the rules ....

Lower market prices for Thai rice result in poor conditions for Cambodian rice exports, (Phnom Penh Post, 20 Feb.):

'Stockpiles accumulating since the [Thai rice pledging] scheme was introduced in 2011 have risen to record levels [in Thailand], and an anticipated fire sale has buyers holding out in anticipation of cheap rice flooding the market. Cambodia and other countries are taking the hit'.

Exporters must decide: to move their stock or to accept lower prices. 

Elsewhere, the importance of rice and rice exports to Cambodia was highlighted through a World Bank assessment which highlighted how the number of poor in Cambodia had halved since 2004. Main reasons were increasing prices for rice and higher productivity. 

Especially higher prices seems to contradict common logic which says that low prices are good for the poor. They're not.

The article in the Cambodian Daily (Feb. 21) also highlights that though the poor has halved, most now languish in the near-poor category!

Resistance

Or we could note that Burma exports are increasing to Japan (Nation, Feb. 7). As well as smuggling to Thailand. Britain's Telegraph (Feb. 4) has a first-hand report from Burma, opposite Mae Sot, where large scale smuggling is taking place.

Meanwhile in Laos, farmers are apparently defying private armies trying to rob them of their lands (Radio Free Asia, Jan. 22), now why is this not a headline? 

'In a rare act of resistance, dozens of rice farmers in northern Laos have defied armed police orders to vacate land seized by a Chinese company wanting to build an airport as part of a casino-driven special economic zone, according to villagers.
The 50-odd farmers refused to budge when policemen, armed with AK-47 assault rifles, moved on Friday to enforce an order by the King Romans (Dok Ngiew Kham) Group for the farmers to leave their rice fields to make way for the construction of the airport in Tonpheung district in Bokeo province'.

Then in the Philippines where rice smuggling, or rice importing at inflated prices is all the rage. But those pinpointed alleged receivers are suddenly not fit to face a Filipino Senate committee (Oryza, Feb. 24).

Up your street

Or we could note that Thai research has found out that their farmers are a lot worse off than Vietnamese and Burmese farmers (despite the higher prices?). Thai farmers are hampered by the high cost of inputs so concludes the article on the research by University of the Thai Chamber of Commerce (Bangkok Post, Feb. 26).

But a quick flick through the article learns that the low productivity is the crux of the discussion and probably the high cost of labour, it's not clear.

Even worse is the conclusion, that it in part is due to the governments rice-pledging scheme. That seems to be the world upside down. But yes, that's how it is seen. The backers are requesting the government (which one?) to use subsidies to drive down production costs. 

But how? Will they want to lower labour wages? Give hand-outs to fertlizer and chemical producers? 

If you believe rice-pledging was hampered by graft and accountability, then why would you propose even less accountable alternatives?

One mistake (besides graft and accountability; no matter what you do these will always remain a problem in the Thai context) the government made was to think that the rice pledging programme would be self-sufficient: hoarding would lead to higher world prices. Market conditions were not so and the government failed to act.

And now I still being sucked into the discussion ....

Anyway, Siam Kubota's profits will drop so reports the Bangkok Post (Feb. 25 ) mainly due to lower purchasing power of farmers because the price for rice is lower. So, obviously the reverse is true, the rice-pledge has lead to increased investment. Or not?

And the Bangkok Post (Feb. 24) has a rather lengthy exposé in which they calculate that organic rice growing is as profitable as for non-organic. So if their consequence support for lowering input prices (above) is thought through, this would be distorted and yes the subsidies would mean more chemicals on the farms, good to see Bangkok Post jumping on this bandwagon!

Abbreviated

An interesting article throwing up SOME NEW quandaries was to be found in the NZ Herald (Nov. 2). 

Focusing on pine it raises the question, when is GM GM? discussing new technologies:

'They are novel DNA-changing techniques that blur the lines around what is and what isn't genetic engineering. Their names alone are fuse blowing: zinc-finger nuclease (ZFN), TALENs (transcription activator-like effector nucleases), cisgenics, oligo-directed mutagenesis (ODM) and others.
These molecular technologies, which target specific genes, offer potential to breed crops, trees and animals with desirable traits and block out less desired aspects more accurately and efficiently than traditional GM and non-GM techniques'.

And though the at the heart of this New Zealand discussion is pine, it also notes that it could erode NZ's green food image:

'It sets up the potential for exporters to inadvertently send traces of a ZFN organism to Europe and potentially trigger market objections," Terry says.
He cites kiwifruit as an example of a crop that could be inadvertently contaminated through the spread of pollen from pines with ZFN-altered DNA'.

At stake of course is what is what. If GMO is to be avoided, what is ZFN? And what lies ahead? Does anyone have an answer? Or are we to leave the dicussion for scientists (= trustworthy?), activists, businesses or lawyers   ....?

Thai state of affairs

While Thailand sees yet a implosion, it's rice pledge scheme is at the heart of not only it's critiques but also in the center of the political struggle. Despite all it's misgivings the largely rural electorate sees rice-pledging as it's return on investment.

It's thus funny to see the opposition trying to make hay out of the scheme (Nation, 28). As if they have a ready answer for the non-urban electorate. And as the PM says, we know what the shortcomings are, no news there.


In the past month the IMF waded into the Thai debate slash quagmire (Bangkok Post, Nov. 13). 
It urges a rethink. 
Because it is eroding public confidence in Thailand's finances. 
Well, so may be, but confidence in the country has long ago ebbed away and the constant cycle of protest / counter protest / election landslides and mini-coups has a lot more to do with that ....

The Thai government though, believe they are in the good. According to the Nation (Nov. 13): 

'This helps boost the economy, as farmers’ income will rise and their debt will decline. As such, their purchasing power is increasing ...'. 

There's no counter-argument? 
Well, the cost of the scheme may not reflect well on the benefits, the potential for financial ruin remains. Debt may well go up. Too much middle man involvement (reading skimming). And graft possibilities.

So it's not so strange to hear of delayed payments to farmers. Where is all the money coming from? And how to pay for the rice buying? The answer are bonds. 
The Bangkok Post (Nov. 20) notes that the government will put a 3-year bond on the market to finance further purchases. Will it be succesful? It might as it provides higher returns for investors. And more debt for the government ...

However, despite this cash infusion (and delay in payments), liquidity of Thailand's agricultural bank (BAAC) seems to be ok (Bangkok Post, Nov. 23).

'Previously, the Public Debt Management Office (PDMO) disclosed a plan to raise funds of 140 billion baht for the 2013-14 main crop, with 75 billion baht to be raised through government bonds to finance the scheme and borrowing in the form of term loans. "Part of the proceeds from the PDMO will be used to repay the bank for the accrued debt from the subsidy where it is supposed to be cleared by thefiscal-2014 budget. The bank's liquidity crunch is an immediate crisis, so we need to use the budget to handle this first," said Mr Tanusak. He insisted that by doing so, the government's paddy scheme is financially manageable'.

That's why there is no need for the sale of bonds? That might contradict earlier plans, so lets assume they are still on the rails. The rice pledge scheme will receive a new infusion of cash (Bangkok Post, Oct. 30), that's all. And so will others ...

How much is lost is a big question mark.

The so-called Post Audit Committee has been doing some calculations and puts the loss at 330 milllion baht (just 10 billion $US!) or nearly 60% of what was paid in by the government (Nation, Nov. 6).

Bailouts if not coming from the financial sector have to be seen overseas.

Hope is still pinned on China. More rumours of possible deals in the pipeline. The Bangkok Post (Nov. 21) describes claims of a government to government deal between Thailand and the state enterprise of Heilongjiang. 1.2 million ton apparently sold based on global prices. Probably meaning another heavy write-off. One snag, as I see it, the rice will be partially be used as cheap hand-out to 

'poverty stricken nations'.

Which means that these nations won't buy any rice anymore ... Oh and the deal is ex-warehouse revealing that the Chinese might have some issues with quality. Or lack of ...

It's also noted by the same newspaper, the same day that there are questions to be asked. The above. And:

'Nipon Poapongsakorn, a former president of the Thailand Development Research Institute and now a fellow at the TDRI, also questioned the validity and viability of the contract, noting that China's state state enterprises are allowed to import only half the yearly total, with the balance to be handled by private Chinese firms'.

The best way to get your money back is to sell. This from Reuters (Nov. 13):

'The results of the earlier tenders were disappointing. The government sold just 240,000 tonnes of rice in three tenders in July and August out of the 660,000 tonnes offered and another 53,000 tonnes out of the 300,339 tonnes offered in October.

Buyers would prefer to obtain fresh rice from the current harvest than buy from the stocks, traders said'.

No silver lining.

Others seek to address how much rice is stocked and hanging above the market.

Oryzae.com (Nov. 21) mentions stocks taken by USDA are near to 15 million tonnes, excluding the 2 million recently pledged. 

The Bangkok Post (Nov. 21) has it's own take on the stocks of rice in Thailand:

'The Thai holdings will surge 18% to 14.9 million tonnes in 2013 and 2014, the International Grains Council forecasts.

...

Bad weather that hurt crops in the Philippines as well as in India will provide price support in the near term, said Samarendu Mohanty, senior economist at the International Rice Research Institute, based in Los Banos, the Philippines. Output in India may drop as much as five million tonnes to about 100 million to 105 million tonnes in 2013 and 2014, Mohanty said.

"With these Philippines and India cases, and China importing more, I don't think the price will go down any more," said Mohanty, forecasting a gain of as much as $30 a tonne by the end of March. "The upside is limited by ample supply in the market and stockpiles in Thailand."'

Bigger is better so it seems and no guessing that Thailand wants to become the worlds no. 1 rice exporter.

'Thailand is maintaining its original projection to export seven million tonnes of rice this year and is set to reclaim its previous role as world’s top rice exporter next year, according to the Commerce Ministry'. 

So reports the MCOT English News (Nov. 20).

Away from the serious business (or not?), the Not the Nation (Nov. 20) announces that the rice stacks will be transformed:

'Attempting to counter accusations of economic mismanagement, the government unveiled today a bold proposal to turn all of its unsold rice stocks into a “world-class tourist attraction and sports destination” by creating the world’s largest artificial ski mountain.

At a joint press conference with the Tourism Authority of Thailand, prime minister Yingluck Shinawatra revealed images of the proposed 340-meter high hill, complete with five automated chairlifts and a 200-room ski lodge and hotel at the base'.

!!!

Time for something different?

Well If the government doesn't know what policy to follow, why not ask businessmen themselves? 
Charoen Pokprahand (CP) chairperson Dhanin Chearavanont explains (Bangkok Post, Oct. 27) that the way forward is to cut rice production by a third!

'He suggested the government urge farmers to cut down their rice planting and grow other crops by offering a subsidy of 1,500 baht per rai. Supply would shrink and that should drive up prices'. 

One of the current weaknesses of the rice-pledging is government graft, surely that will not go away with this! Whatsmore, how do you stimulate farmers to not produce rice if data concerning farmers and farms is inadequate?

The same article also reveals that losses can never be as high as some claim as the newly appointed permanent secretary at the Finance Ministry is

 'experienced'. 

That he claims, despite not having seen the figures themself!

The remedy, IMF suggests, is to cut the rice subsidies and distribute the savings in other subsidies? So where does the public confidence erosion stop?

What is the reaction by the Thai government?  Take a hike! Predictable.
  

Bloomberg.com (Nov. 13):

'Thailand said that it will press on with a $21 billion rice-purchase program, spurning a call from the International Monetary Fund to end the loss-making intervention and telling the lender its approach is better'.

A potential idea. Even though rice pledge prices are above market prices, farmers should focus on niche markets. The Bangkok Post (Nov. 12) mentions

'experts' 

suggesting farmers to switch to rice seed production or to higher value rice varieties such as:

'Khao Leum Pua black glutinous rice and Rice Berry, two highly nutritious grains with strong demand'.

Price implications

With stocks increasing in thailand what are the implications for the wider global market?

Malaysian Insider (Oct. 30) notes that export prices for Thai riceare at a 3 year low ... Outlook is for prices to drop further ...

Bloomberg (Nov. 21) has another take on Thailands rice pledging. Not that revealing though. The stocking and non-selling is driving prices down, even though the Philippines may import more.

On the other hand, in a sign of changing market conditions, Thai rice exporters are also moving away from their grumpy stand (Bangkok Post, Nov. 25). Or is the simply no more way down ...?

Varia

Bangkok Post (Nov. 5) notices that the Philippines will have it's first genetically modified rice in 2-3 years. It weighs the pro's and con's but has little to add.

Arsenic and rice. A major news item (Nov. 19) in the past weeks has been a study in Bangladesh which links arsenic in groundwater with higher levels in rice.

'Even small amounts of arsenic, over a long time, can cause cancer of the bladder, kidney, lung or skin, previous research has found'. 

No real solutions other than diversifying palate. Might have some implications for bangladeshi exports. And Cambodia might well have similar problems.

Reeling in non-partizanship. Previously stated here, German official aid is teaming up with private funding from Bayer. signalling hybrid rice as avenue of the near future, opposition to the is wastage of public funds is increasing. CTA (Nov. 28):

'In fact, Oxfam and numerous other NGOs oppose the GFP in its entirety. It "threatens to turn small farmers into mere appendages of the business and agriculture models of agro-business", according to the Environment and Development Forum, a broad alliance including Oxfam, the Friedrich-Ebert Foundation, Brot für die Welt (Bread for the World) and the human rights organisation FIAN'.

Regional news

The Irrawaddy (Oct. 30) has a nice piece on Burma's emerging rice export industry:

'Domestic media reported last week that Burma’s export earnings have already slumped about US$100 million so far in this financial year because of weaker harvests caused by poor weather. But a bigger problem is an export market bloated with better-quality rice than Burmese growers can produce, said Samarendu Mohanty, an economist with the International Rice Research Institute (IRRI)'.

Bloomberg (Nov. 27) also picks up on this story and mentions that Burma wants to export near to 5 million tonnes in a year or 5. There are quite a few problems ahead, but the Burmese are brimming with confidence. What might not help are prices dropping ...

Another country affected by the less than optimal export market for rice is of course Vietnam. Export projections have been revised downward so says Vietnam News (Nov. 11):

'The Vietnam Food Association (VFA) readjusted the rice export target for 2013 from 7.5 million tons to 6.7 million, reflecting four months of decreased exports.

...

Deputy Minister of Industry and Trade Tran Tuan Anh told Vietnam News Agency that the country's low rice export turnover was due to competition from India and Pakistan in the African market.

The two countries' favorable geographical locations made their transport fees more competitive, while difficulties in payment and transport forced Vietnam's exporters to rely mostly on intermediaries, he said'. 

Strange as China is one of the biggest importers ...

On the other side like the Burmese there is another sign of hope for Thailand. Why? The sell-off in Vietnam has finished. Apparently nothing is left! Vietnam.news (Nov. 25): 

'“The rice volume in stock is modest, which may be not enough to fulfill the signed contracts. Meanwhile, the sale on the domestic market goes well,” Tuan [Le Thanh Tung, a senior official of the Ministry of Agriculture and Rural Development (MARD)]said.

“We fear that we may miss the opportunity to export rice to the Philippines, when the country needs more rice to relive the people in the typhoon stricken areas,” he added'.

Big news: The Nation (Nov. 22) reports that Cambodian jasmine rice has been awarded the accolade of world's best rice. For a second year running ...