Green Leader Holdings Group officially broke ground yesterday on the first cassava processing factory in the Snoul district of Kratie province, an initiative by the Hong Kong-based investment firm to make Cambodia’s cassava industry commercially viable.
Michael Tse, Green Leader CEO, said at the ceremony that the factory was the start of the company’s commitment to invest in Cambodia’s cassava industry and improve its yield.
“Today is the most important day for Green Leader over the ground-breaking ceremony of our very first cassava starch factory,” he said.
“Our company attaches great importance to the formal establishment of our first factory in Cambodia as a concrete show of our firm commitment towards the Royal Government of Cambodia and towards the people of Cambodia.
“The commitment is especially valuable to farmer communities throughout the country, and shows we are dead serious in helping to industrialise the long-struggling cassava sector of the country.
“We hope through our expansion model in achieving sustainability through an economy of scale, we would be deepening our strong partnership with the farmer communities throughout the country including the key institutional partners such as the Ministry of Agriculture Fisheries and Forestry, the Ministry of Commerce, the United Nations Development Program of Cambodia and any future key ones to come,” Mr Tse added.
Deputy Prime Minister Yim Chayly, who presided over the ceremony, said the presence of Green Leader in the province proved the confidence of foreign investment in Cambodia.
“The ground-breaking of Green Leader is testimony that we have peace and political stability,” he said.
“This is the first factory for the company and they will continue to build about 20 nationwide.
“I do appreciate the company making the decision to investment in Cambodia. This will help to deal with the price instability that our farmers face,” he said.
“We see that the company will engage in contract farming with farmers by both providing credit, techniques and sending experts with new seeds to produce more yield of good quality.
“They are also committed to ensuring the price for farmers, so this is a very good thing,” he said.
Va Thorn, deputy governor of Kratie province, said at the ceremony that cassava was the second main agricultural crop in the province.
Presently, more than 70,000 hectares were being used to grow cassava, of which more than 60,000 hectares were planted by households and the rest by companies.
“In Kratie, we have two cassava-processing factories,” he said.
“One is in Sambo district and one other is in the provincial town, and which has been operational for more than five months.
“Green Leader is the third one. We do hope that the company will help to maintain the price of cassava because our farmers have always suffered from fluctuating prices because they rely on neighbouring countries.”
The cassava industry has been notable for the increasing number of farmers producing it. It contributes nearly four percent of Cambodia’s GDP.
Presently, the Ministry of Commerce is spearheading the formulation of a national cassava policy to address challenges, investment opportunities and boost production and exports.
Mr Tse says the company will build 20 processing factories in Cambodia. At least two would be built this year, and the company was looking for a third factory site between Kratie and Stung Treng provinces.
“We are focusing on these provinces initially is because they are major cassava-producing areas with no processing plant,” he said.
“Local farmers sell to middlemen who then transport the products to Vietnamese parties who process and sell to Chinese and European markets claiming them as Vietnamese products.”
According to the Ministry of Agriculture, cassava plantation areas in Cambodia have increased from 30,000 hectares in 2005 to 684,070 hectares in 2016, of which the yield area was 675,126 hectares in 2016 with total production of 14.8 million tonnes.
Cassava is planted mainly in Battambang, Banteay Meanchey, Pailin, Kratie, Kampong Thom, Tboung Khmom, and O’dor Meanchey provinces.
The cassava market for Cambodia has been expanding from the traditional markets of China, France, Vietnam and Thailand into 16 other markets – Canada, China, Britain, Finland, India, Italy, South Korea, Lithuania, Malaysia, Myanmar, Holland, Norway, Taiwan Island, Thai, USA and Vietnam.
Cambodia exported about 2.3 million tonnes of cassava chips in the first nine months of last year while the figure for the whole of 2016 was about $2.9 million tonnes, according to the Ministry of Agriculture.