Philippine Rice Deal Runs into Challenges

A recent ban on rice imports to the Philippines could hinder negotiations on a deal for Cambodia to export thousands of tons of rice to the country, an official at the Philippine Chamber of Commerce and Industry said yesterday.

Roberto De Venecia, vice chairman of the Philippines-Cambodia Business Council, said the Philippines last month discovered that government-run warehouses were full of imported rice stock, and the Philippine government was currently carrying out an inventory on the country’s rice supply to uncover “obvious anomalies in the over-importation.”

The deal, which Philippine officials said in July at a trade fair in Phnom Penh could reach up to 300,000 tons, would be worth around $73.58 million at current market prices.

“The rice deal between Cambodia and Philippines is non-existent as of this

time,” Mr De Venecia wrote in an e-mail, adding that the newly elected administration in the Philippines, which took office in July, would require time before any decisions on the Cambodia deal are taken.

Moreover, Mr De Venecia said that local rice supply in the Philippines from

October’s harvest was expected to be abundant, keeping stocks replenished until at least December.

“The shortfall in production will have to be determined, which will then be the basis of importations,” he said.

As for any future deal with Cambodia, Mr De Venecia said: “There have been proposals and talks are ongoing.”

The news highlights some of the challenges the government could face in sealing rice deals abroad only weeks after the government announced grandiose plans to increase rice imports from Cambodia from 14,000 tons currently to one million tons in 2015.

Sok Siphana, an adviser to the government in the negotiations, said that talks were in very early stages, with an initial proposal from Cambodia still being etched out.

“I’m not saying it’s far away at this point in time, but I am still collecting my data,” he said.

Mr Siphana added that the possible deal with the Philippines was part of a much larger government plan to export larger quantities of milled rice to countries such as Russia and the members of the Baltic States.

Thon Virak, director of the state-owned rice exporter Green Trade, also said that negotiations were due to take place between the two countries but that nothing had yet come to fruition.

“They want to buy from us, but they have not discussed with us,” he said.

Mr Virak said that the Philippines quota for rice imports amounts to 1.8 million tons annually, of which 300,000 tons is reserved for private sector deals.

It is that portion of the quota that Cambodia is hoping to tap into, he said.


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