Prime Minister Says Rice Exports to Fall Well Short of Goal

Prime Minister Hun Sen on Thursday conceded that Cambodia would not reach its long-stated goal of exporting 1 million tons of milled rice in 2015.

Speaking at the launch of an agriculture census at his office building in Phnom Penh, Mr. Hun Sen told the audience that while Cambodia had again surpassed its 4-million ton goal for paddy-rice surplus, a lack of investment in domestic milling and stiff competition from abroad had led to an export total of about half a million tons for the year.

“For the second target—to export 1 million tons of milled rice—it cannot be achieved,” the prime minister said.

“We used to be a country that lacked food and imported it to supply the domestic market. We were not prepared to fill in the export demand,” he continued.

“So, some investors have not looked at the quick increases in rice paddy production in the country. That’s why we lack rice paddy milling machines, storage facilities and especially cash for buying rice paddy from farmers.”

The 1-million-ton export goal was set in 2010, the same year that the government created a new rice policy to increase paddy production, encourage domestic production and boost exports.

In his speech, Mr. Hun Sen said rice production in neighboring countries had also hurt Cambodia’s exports.

“Developing countries produce the same goods. Now, we just look at the Mekong region. Cambodia produces rice, Vietnam produces rice, Thailand produces rice, Burma produces rice, Laos also produces rice,” he said.

“This factor requires Cambodia to strengthen its capacity and we also need to reduce costs of           production.”

Hean Vanhan, deputy director-general of the Agricultural Ministry’s general directorate of agriculture, said on Thursday that Cambodia exported 456,917 tons of milled rice in the first 11 months of the year, 91,883 tons of which went to China.

“In December, we will export maybe around 50,000. We hope…we can reach more than 500,000—50 percent of the goal,” he said.

In 2014, milled rice exports reached 387,061 tons.

Contacted on Thursday, Song Saran, CEO of local exporter Amru Rice, said that while local milling and export firms had spent millions of dollars developing their processing capacity since 2010, more investment was needed.

“Thus far, the private sector has invested just in the necessary parts of processing like the milling and polishing machines, but not drying machines and warehouses,” Mr. Saran said.

“We still need to have those to have the full capacity to process and export 1 million tons,” he said, adding that electricity and transportation costs also needed to be reduced.

(Additional reporting by Anthony Jensen)

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