Misguidance

It's been a while since I've highlighted hybrid rice as such, let alone the possibility of this growing in Cambodia. However it's the Asia Sentinel (Apr. 5) which tears into Cambodia's lack of political will to push the sector further:

'It may be only a matter of time before Cambodia’s rice industry disintegrates, partly as a result of a weak Cambodian Rice Federation and partly because of misguided government policies'.

It seems a pretty harsh critique, but the author of the article does seem to know what he's talking about. He then gives the following as evidence:

'The industry’s main players from the private sector must stand up to play a role in improving the industry in the face of a new problem. It has been reported that the Ministry of Agriculture has been testing a strain of low-quality but high-yield hybrid rice for export.  

...

There are two dangers in the government’s experience through the Ministry of Agriculture. As the industry runs through the testing process, without strict controls –which the government appears incapable of – hybrid pollens are certain to be spread rapidly kilometers away from the test zones, carried by the wind and insects or rodents.  Hybrid cultivation would very likely eradicate Cambodia’s high-quality Rumdoul and Sen Kra Ob varieties for good. Destruction of the native species from hybrids is likely.

Low-end hybrids recommended by the government would put Cambodia at a disadvantage to Vietnam. Our market positioning should be at the high end. Going along the hybrid route would simply spell disaster and if such news is true, it shows that our Agriculture Ministry policymakers do not fully comprehend the implications of such a policy blunder. Recommending the use of hybrid rice for Cambodia is wrong'.

Wrong it may be, but that's never stopped the establishment from pushing their own agenda.

Take for instance the Green Revolution which is yet to be continued and some would argue that this (the second Green Revolution staying away) is a plus for the globe's many small farmers.
However that's not going to stop the ambitions of for instance the IRRI. It has now (Apr. 7) got Green Super Rice (GSR) in the pipeline to address the future. The news item has suspicious little on detail. If one clicks on, one would discover that

'GSR varieties are a mix of more than 500 promising rice varieties and hybrids'.

Hmmm, there seems no stopping hybrid rice advocates.

Strengthening the struggle

One can't fail the Cambodian government for tinkering it's policies here and there. The Phnom Penh Post (Mar. 31):

'The government has decided to strengthen entry points along Cambodia’s borders to block illegal rice imports, while promising to dissolve any company’s certificate of origin that is caught mixing contraband rice for export, Cambodian Rice Federation (CRF) president Sok Puthyvuth announced following a meeting yesterday with Deputy Prime Minister Kheat Chhon.

Additionally, the government will scrap the value added tax (VAT) on imports of rice milling machinery – a move aimed at reducing millers’ high capital costs'.

The Cambodia Daily reports on the same but focuses more on the role of the VAT waiver. From Mekongoryza:

'The government decided to drop a 10 percent value added-tax (VAT) for rice products during a meeting on Wednesday between representatives of the rice sector and government officials at the Council for the Development of Cambodia in Phnom Penh, officials said.

...

Sam Arth Veasna, vice president of Federation of Cambodian Rice Farmer Organizations for Development, welcomed the government’s decision.

“Even though it is not a big offer, I think it would make farmers and rice millers feel better,” he said. “However, I cannot assess how much better.”

However bad news was on it's way, despite these measures being announced. The Phnom Penh Post (Apr. 6):

'After two promising months, Cambodia’s rice exports fell by 14 per cent year-on-year in March, according to new data by Ministry of Agriculture, sparking fears amongst rice millers that export shipments would further decline without adequate financial backing.

....

Rice millers said yesterday that the drop was evidence that the industry is struggling with the cost of production, high electricity bills and a lack of finance to purchase and store paddy rice.

...

While last Thursday the government agreed to cut the value added tax (VAT) on imports of rice milling machinery and step up border patrols to crack down on illegal rice imports, there has been no agreement on the facilitation of $250 million in soft loans to proposed by the CRISIS group to ease the financial burden on millers'.

Plans

The Bangkok Post (Mar. 31) reports on expectations that Thailand will be able export 9,5 million tonnes this year. Despite writing the government is upbeat, this target would represent less tonnage than last year and at a much lower value, at least so it looks like.

What's wisdom? The Thai government has announced a 60 day rice sell-off blitz? The Bangkok Post (Apr. 26):

'The government plans to sell all 11.4 million tonnes of rice in government stockpiles within two months for 100 billion baht, the country's rice management board, starting next week. The plan announced Monday is unprecedented in Thai export history - selling off more rice in two months than the country usually sells in a year. Average rice sales over the past couple of decades have been about 10 million tonnes. 

.... 

Traders were sceptical Monday about the government's ability to sell off remaining stocks in just two months. Supachai Vorraapinyaporn, president of Tanasan Rice Group, the third largest rice exporter, said the government's target of offloading the rice within two months was not possible. "This is a million percent impossible, considering that previous auctions were monthly, and only around 400,000 tonnes," said Mr Supachai. "Perhaps they meant two years, not two months," he added'.

Does the Thai government know something we don't? Surely prices are low. But what with El Niño in full swing one might expect less output from Southeast Asia and India, thus higher prices .... 

It does spell lower prices in the short term if it does indeed succeed in selling off virtually all their stock.

One to suffer will be Cambodia. The Khmer Times (Apr. 24):

'Cambodia Rice Federation (CRF) vice-president Hun Lak told Khmer Times yesterday the pledge by the Thai government to release so much milled stock so quickly would push the global price lower and have an indirect impact on Cambodian exports'.

But the junta has more bad news for it's farmers. The Bangkok Post reports (Apr. 22) on a communist approach by the junta to rice growing. 

'Commerce permanent secretary Chutima Bunyapraphasara said the area to be cultivated was set by a meeting of the committee planning for integrated rice cultivation.  

The Agriculture Ministry would announce the target zones for rice growing next week, along with planting dates'. 

It's unclear whether or not the junta will dictate the rains. But I assume that these will be just as difficult to line up, as will I believe the rice growing farmers. Will they outlaw rice growing outside these target areas? 

Another plan to show how incompetent the junta is.

Rebound

Another victim of El Niño is Thai sugar production. The Bangkok Post (Apr. 1):

'The El Nino weather phenomenon has played havoc with crops across Southeast Asia and beyond. Thailand, the world's second-largest sugar exporter, will ship 20% less of the sweetener to international markets this year than last, and farmers fear the damage already inflicted on young cane plants could make next year worse.

...

They are part of a growing number of rural Thais struggling with debt. Most are rice farmers, who were hit hard when the military seized power in 2014 and ended generous subsidies. The irony for some in Ratchaburi is that they have taken a double hit: They were encouraged to convert to sugar from rice as the government sought to cut subsidy reliance and reduce massive rice stocks. As epected prices will rise so not all bad news'.

Interestingly from Cambodia the report that palm sugar is going strong. The Phnom Penh Post (Apr. 1):

'Demand for Kampong Speu palm sugar has surged, with orders already up 70 per cent this year, as appetite for the premium organic sugar product grows, boosting its price.

Orders for 260 tonnes of the palm sugar have been placed this year, compared with 150 tonnes in all of last year, and despite its market price climbing to $1,400 per tonne, about $50 more than in 2015, Sam Saroeun, president of Kampong Speu Palm Sugar Promotion Association (KSPSPA), said yesterday.

The Lao authorities report on opportunities for cardamom growing. The Vientiane Times (Apr. 4):

'Many local farmers in Phongsaly province are shifting to plant cardamom after earning lucrative income from growing this crop and selling it to Chinese traders.

...

However most villagers are very concerned about the fluctuation of the cardamom market, particularly when more people move to grow this crop as the prices might go down.

A painful lesson has been learned by farmers who grew rubber and falling princes of rubber led farmers in many provinces of Laos to lose profits while some had to resort to destroying their trees to grow other crops instead'.

Meanwhile banana farmers are fearing worse. Vientiane Times (Apr. 20):

'According to a recent report in the Chiang Rai Times , workers at Hongta International, a Chinese-owned banana plantation in Chiang Rai province's Phraya MengRai district, have been tested and found to have unusually high levels of chemicals in their blood.

The Chinese firm leased about 440 hectares of land in Phraya MengRai district to grow Cavendish bananas before the PhayaMengRai Hospital was assigned to conduct blood tests on 43 of the plantation's 200 workers.

The test results showed the health of 10 of the workers' was at risk, while 13 already had unsafe contamination levels. 

...

A survey undertaken by NAFRI [National Agriculture and Forestry Research Institute] and unveiled on March 31 noted there were several reasons why Chinese companies wanted to establish banana plantations in Laos. One was the low cost of land leases, the second was low labour costs, and the third was the lax control of chemical use'. 

More positive news this time for rubber growers. The Phnom Penh Post (Apr. 29):

'A sharp rebound in international rubber prices has put workers at plantations in Cambodian back to work, and has infused the sector with a rare sense of optimism.

International rubber prices began rising in March from seven-year lows and have seen an upswing of 16 per cent since the start of April on concerns over output and expected pickup in demand from China'.

Finally, a short note from Thailand as to what they think about the possible TPP. The  Bangkok Post (Apr. 28):

'Farmers nationwide have threatened to organise protests against the government if it decides Thailand should take part in the Trans-Pacific Partnership (TPP) agreement'.

Voices

It's funny how relevant issues are not receiving the importance they deserve. One such issue are the new trade deals drawn up by the USA.

Relevant for the region is the Trans-Pacific Partnership (TPP) trade initiative which has recently been concluded; a new trade deal between 12 Pacific Rim countries. Regional signatories in this are Vietnam and Malaysia.

Problems are that it's not (yet?) clear what has been achieved (discussions were secret), though it seems to be a win for big corporations. This may well pave the way for hybrid rice production and trade to increase. 

For non-hybrid rice trade, it's expected that Vietnam will gain more favourable access to the U.S., while Japan manages to keep imports largely at bay albeit for some token imports.

Cambodia is not part of the TPP, though may well be affected especially where it comes to competing with Vietnam. The Phnom Penh Post (Oct. 7) looks at possible developments:

'Some exporters of Cambodia’s biggest agricultural crop also voiced concern over the new trade pact, suggesting it would limit their expansion into the US market.
Song Saran, CEO of Amru Rice, one of the Kingdom’s largest rice exporters, said Cambodian rice accounted for about 2 to 3 per cent of the US market last year. He said that while this represents only a small share of the market, the TPP would restrict any future growth.
“We are not affected by the signing of the TPP, as rice exports to the US are not big as compared to garments,” said Saran. “But it will be challenging to expand our market share in the US.”

Aggressive

Though there seems to be a slight hiccup, rice exports from Cambodia are on the up. Phnom Penh Post (Oct. 2):

'Rice exports fell sharply last month, but the Kingdom’s most important crop is expected to recover and end the year in positive territory.

...

However, September’s dip should have minimal impact on the Kingdom’s annual export tally, according to the UN’s Food and Agriculture Organisation (FAO). Direct milled rice exports between January and August were about 340,000 tonnes, nearly 50 per cent up compared to the same period a year earlier, it noted'.

Noted is that Cambodia is becoming more and more dependent on European and Chinese imports, areas where the Vietnamese have less bargaining value.
 

Cambodia Daily (Oct. 2) sees that the Cambodian rice players hope to exclude national cheaters from exporting: 

'The Cambodia Rice Federation (CRF) on Wednesday announced strict penalties for exporters who mix Cambodian rice with low-quality rice from other countries after receiving complaints that some exporters have been using the method to increase profits'.

It still seems that exploring rice niches may well be the way forward. Khmer Times (Sep. 30):

'Domestic rice millers are preparing to compete against their Thai rivals for a share of the US market as the European Union market becomes increasingly competitive, they say.
The move, which will see the Kingdom’s premium rice competing with Thai jasmine rice, which dominates rice imports by the US, is part of an overall strategy to diversify export markets, rice exporters say.  

...
Economist Srey Chanthy agreed that domestic rice millers will face immense challenges competing with Thai rice in the US market. It is “very difficult to compete with Thailand,” he said. “Maybe Cambodian [exporters] should capture a niche market, like organic rice, or conduct aggressive marketing campaigns and target Cambodian communities as a start,” he said'.

Change

Vietnam seems this years loser when it comes to rice exports. Concerning having (or not) an edge on their competitors,  Vietnamnet (Sep. 21) interviews Dr. Nguyen Do Anh Tuan, Director of the Vietnam Institute for Policy and Strategy of Agriculture and Rural Development (IPSARD):

'To compete amid rice oversupply and consumers preferring to use high-quality rice, the [Vietnamese] rice sector must improve the quality of rice to participate in niche markets which are small but have high value'.

From Thailand the quirky news is that rice farmers should move along. The Nation (Oct. 5):

'The government has called on farmers across the country to grow plants that require less water than rice amid the ongoing risk of drought.

...

... after rice farmers in Kanchanaburi expressed dissatisfaction over the government's plea that they avoid growing rice outside the rainy season'. 

The same source on the same day also has this article which starts off as follows:

'[Thai] Farmers are growing a dry season rice crop - despite authorities' warnings - and have urged the government to come up with concrete policies to help rice growers during the dry season. 

As the dry season approaches, the Royal Irrigation Department (RID) has warned farmers in the Chao Phraya River Basin not to plant the dry season rice crop. They say the available water in the four major dams is not enough for agriculture. Officials suggest farmers cultivate fewer water-consuming plants - or change jobs and become labourers.

...

"We are told to change jobs - to be workers or otherwise plant corn, vegetables or beans instead. This hurt my feelings so much. We are farmers - and furthermore, vegetables do not sell well and are cheap," she [Wassana Gromtu, a farmer from Phitsanulok's Bang Rakam district] said'. 

The Nation (Oct. 2) continues:

'Agriculture and Cooperatives Ministry permanent secretary Theerapat Prayunrasiddhi said the ministry had ordered the Royal Irrigation Department (RID) to inform farmers in the Chao Phraya River Basin about the water situation in order to encourage them not to grow the dry-season rice crop.

...
"During a drought, we see that 80 per cent of farmers outside the irrigation area can adjust well to the situation because they are familiar with water shortages and can change their production pattern, unlike those in the irrigation areas who are used to easy access to water," Wiwat [Wiwat Salyakamthorn, Agri-Nature Foundation president] said. He concluded that the farmers needed to help themselves during drought, as the government cannot provide help to everyone. He urged them to learn mixed farming and have their own water reservoir on their land'.

Trade

The UN's FAO suggests a slight decrease in this years rice output in Cambodia (FAO, Sep. 23):

'FAO currently anticipates the 2015 main season rice production to fall by 3 percent to 7 million tonnes. Assuming more normal growing conditions for the latter half of the ongoing main season and larger sowings for the forthcoming 2015/16 dry season which may partially compensate for the losses incurred by the earlier dry weather, the 2015 aggregate rice production is forecast at 9.18 million tonnes. This is 2 percent down from last year’s bumper crop and slightly above the five-year average'.

Stratfor Global Intelligence (Sep. 23) looks at China's rice market as seen from the US perspective. 
One aspect they concentrate on is how China's food security strategy is maturing, which may enable more imports. On the other hand they note how the US agriculture's dependence on GM strategies is increasing. This in turn raises the likelihood of GM strains turning up in exports thus possibly affecting these. As China has done so in the past.

'Considering the resource scarcity much of the world will face in the coming years and decades, genetic engineering is poised to be a growing part of agricultural strategy, and so contamination will only become more likely. Even though there is already domestic development of genetically modified strains of rice, Beijing is likely to be extremely cautious about accepting foreign genetically modified crops, especially for staples like rice. Furthermore, as Beijing seeks to build up its own agricultural biotech sector as part of its food security strategy, we could see regulations shift accordingly'.

Required
Phnom Penh Post (Sep. 30) has an article on how pepper grown in and around Kampot is gaining better markets at better prices due to good quality control.

'A report released by UNCTAD this week showed that “prices for Kampot pepper had increased significantly after producers gained access to wider and more diversified markets as a result of GI certification”.
In one case study, Kampot pepper producer Starling Farm saw the farmgate price of its product increase from $5 per kilogram before GI status in 2010 to about $18 in 2014'.

Meanwhile Thai rubber farmers want more (Bangkok Post, Oct. 15). In short, a minimum  price, the ability to swap rubber for rice with the government, a review of forest policies vìs-a-vìs rubber plantations on demarcated forest lands and landless rubber farmers and tappers should have the ability to register with the government.

Other news which might have a slight touch to rice trade comes from the Phnom Penh Post (Sep. 25):

'The ministry of Agriculture plans to establish five regional food safety inspection offices near the country’s borders to facilitate the flow of cross-border agricultural trade, reducing the time it takes Cambodian exporters to deliver shipments of agricultural products to foreign markets, a ministry official has said'.

Oddly imports don't face the same requirements.