Rice Traders Want Action on Spiraling Prices

The price of rice has skyrocketed in recent months and rice stores are running dry, say rice traders, who are urging the government to act quickly to avert a food crisis.

Rice in Neak Leung town, an important river crossing and commercial area in Prey Veng province, is selling for $210 to $220 a ton. During last year’s harvest the price was $140 a ton. Rice in Battambang is up to $240 to $250 a ton, up $50 to $70 from last year.

“It’s a huge increase, and with the drought, people will face difficult times,” said Y Vy, a Bat­tam­bang rice trader.

In Takeo province, hundreds of small stores and warehouses in Koh Andet district are nearly empty, said Chhim Chhoy, a rice trader in the province. In Neak Leung, warehouses are running low with only 100 to 200 tons each, said Kim Savuth, president of the Rice Mill Association at Neak Leung.

Traders in Prey Veng, Takeo and Battambang blamed the problems on Cambodia’s drought—the worst in years—but also claimed too much rice had been exported at the wrong times this year. They called for a periodic ban on exports and for government to keep rice in reserve.

“There is no rice to sell to people now,” Kim Savuth said. “The news about the drought, and over-selling rice to neighboring countries, are the major reasons prices are increasing from day to day.”

Kim Savuth suggested banning exports during harvest season and removing taxes on imports, which amount to $30 a ton.

Y Vy said large quantities of unmilled rice were sold to neighboring countries soon after January’s harvest. Now, with the drought, Cambodia is forced to buy the rice back at higher prices, he said.

“I think we should stop selling unmilled rice to Thailand and Viet­nam. [Farmers] should take [rice] to the good rice processing factory so they can export good milled rice,” he said.

But Cambodian rice mills are consistently of poor quality, agriculture experts say. The rice they produce is commonly used for domestic consumption but unsuitable for export. This leads farmers to export unmilled rice instead, even though those prices are often low because most of the varieties grown here are not popular.

Chhim Chhoy’s shop exports 50 tons of unmilled to Vietnam each day at $117 a ton, while importing at least 10 tons of milled rice to sell to local distributors for $282 a ton.

Cambodia’s only international-class exporter, Angkor Kasekam Roongreoung, collected more than 50,000 tons of rice after the last harvest for processing in its $6 million factory in Ang Snuol district, Kandal province, Chief Executive Officer Chieu Hieng said.

It contracts with 30,000 farmers in four provinces.

The key to surviving drought is for the government to assist in improving irrigation by digging ponds and channels, Chieu Hieng said.

That would be more constructive, he said, than handing out relief rice to farmers—a strategy that political parties often resort to as elections approach.

“Government should raise funds to support farmers by providing them with more water. That would be better than handing out small donations every day,” he said. “Water is not only good for rice farming, it will help people to grow seasonal fruits. We will buy any kind of fruit for a fair price to be exported.”

Kim Savuth, whose association includes 27 rice mills, also said the government should consider setting up a reserve.

“They have to think ahead, that with 12 million people, how much spare rice will there be to eat. Government must have its own warehouses.”

The drought has cost the country $38 million so far, according to the National Committee for Disaster Management and the Ministry of Agriculture.

Kompong Speu, Takeo, Kam­pot and Kandal provinces have been especially hard-hit, with only 10 percent to 15 percent of seedlings surviving, officials say.

 

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