Rice exports to Thailand dive + Rice industry caught in flux

[geovalin]

Rice exports to Thailand dive

Thu, 29 May 2014

Chan Muyhong

Rice exports to Thailand plummeted in the first four months of the year as a result of that country’s surplus, which reached record levels at the end of 2013.

Between January and April, Cambodia exported just 1,550 tonnes of rice to Thailand, down 89 per cent from the 14,250 tonnes shipped in the same period last year, according to the Ministry of Agriculture’s monthly reports.

Hun Lak, president of rice export firm Mekong Oryza Trade, said the decline was due to Thailand’s rice stockpiles, which were accumulated under a state purchasing program launched in 2011 and scrapped at the end of last year.

Thailand accumulated rice stockpiles of reportedly more than 12.8 million tonnes at the end of 2013, equal to about a third of the global export market.

“The overstock of rice in Thailand reduced the demand from Thai traders for Cambodian rice,” Lak said.

“Also, rice prices in Thailand are declining as a result, meaning buyers simply cannot make a profit by importing Cambodian rice,” he added.

Thai rice prices sunk from $1,100 per tonne to $950 per tonne in February as the state-run rice pledging scheme came to an end and the Thai government began selling off its stockpiles. Consequently, Cambodian exporters reduced their prices from $950 to $880 per tonne to compete.

Lim Bunheng, president of Loran Company, said Cambodian farmers depend on Thailand and Vietnam for exports largely due to a lack of local facilities to polish and clean rice – the final stage before the product is fit for international standards.

“I hope the situation will get better after June – when more of Thailand’s stockpiled rice is sold off – because it is having an impact on our industry now both in terms export volume and price,” he said.

Sok Puthyvuth, president of the Cambodia Rice Federation, called on rice exporters to seek other markets rather than “sitting and waiting” for the situation to get better.

“We should take this chance to start to diversify markets to potential countries like China, Indonesia as well as countries in the EU for our rice while waiting for Thailand to settle things,” he said.

Thailand imported 23,550 tonnes of Cambodian rice in 2013, making it the Kingdom’s sixth largest destination for rice exports.

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Rice industry caught in flux

Fri, 30 May 2014

Chan Muyhong

The rice industry's quest for greater quality at lower cost reached a dead end yesterday at a conference in Phnom Penh, with exporters and farmers polarised on how to achieve greater returns for the industry.

The workshop, titled "Improving Rice Value Chain and Enhancing Farmers’ Livelihoods", was attended by more than 70 farmer representatives, businesses and government officials. On one side exporters want farmers to provide a better-quality rice grain, but on the other, farmers cannot afford the premium to pay for the higher-quality seed.

Hun Lak, president of rice exporter Mekong Oryaza Trade, urged farmers to be more selective when choosing their seeds to produce better-quality rice.

“Good-quality rice can be sold at a higher price,” he said. “Quality rice can also help [rice exporters] to find markets easier and also help us to compete in the market.”

Fellow exporters and rice millers supported Lak’s view, including Vong Bunheng, president of Heng Heng Rice Miller, who said millers cannot continue to pay farmers for poor-quality rice.

“Buyers only want the long and less chalky rice. Currently only 30 per cent of stock is salable as premium grade. Where can I sell the remaining 60 per cent?” he said.

Kan Vesna, a farmers representative from Battambang province, rebutted the millers concerns, saying millers systematically reducing prices across the industry created little incentive for farmers to improve their crops.

“Using quality seed and proper farming techniques means higher production costs, and if they are going to sell their paddy at the same price as other farmers, why should they do it?” he argued.

Ly Eng, another farmers representative from Battambang, said a lack of funds to afford good seeds meant standards would remain the same.

“Good selection seeds are expensive, and most of the farmers’ knowledge with farming technique is still very limited,” he said.

Eng called on rice millers to lift their buying price.

“When you give higher prices, farmers can use the money to improve their farming. Farmers will be able to cease practising outdated, traditional farming techniques,” he added.

Hean Vanhorn, the deputy director for the General Department of Agriculture, said the farming community should come together and stock quality seed for future harvests.

“It starts with a strong rice-farmer community. [The government] will be able to provide help to train farmers on farming techniques,” he said, adding that the government wouldn’t subsidise seed.

“I have listened to the comments of the speakers here. They are all very good, but to answer our question on how to get farmers to use quality seed – after the discussion this morning, it is not still answered yet,” said farmers representative Eng at the close of the debate.

http://www.phnompenhpost.com/business/rice-industry-caught-flux