Signatures of Asia last week agreed to purchase 53 tonnes of palm sugar from Chouk Samaki Meanchey, an agricultural community in Kampong Thom.
For in depth analysis of Cambodian Business, visit Capital Cambodia
The company and the cooperative signed the deal on Friday, according to Chan Pich, Signatures of Asia general manager.
“The company will purchase about 53 tonnes of palm sugar from the cooperative at 4,500 riel or $1.12 per kilogram,” Mr Pich said. “We will sell this authentic palm sugar from Kampong Thom in the domestic market.”
Mr Pich said Signatures of Asia will sell the palm sugar at $2,47 per kilogram. “With this price, we have a very small profit margin since we also have to spend on packaging, staff, and transportation to the capital, among others,” Mr Pich said.
“We are almost making zero profit. However, we decided to go ahead with the agreement because there is a lot of fake palm sugar out there, and because it is hard for consumers to find the real deal.
“We already have some orders for our natural palm sugar. According to our research, there is plenty of demand in the market to justify the deal.”
Mr Pich said that the palm sugar they are purchasing does not have an organic certification but that it is grown without the use of chemical fertilizers.
He added that the agreement has been signed with a group of 26 farmers in the cooperative, and that it is valid for one season.
Hue Hor, president of Chouk Samaki Meanchey, told Khmer Times that the palm sugar will be supplied during a period of five months, adding that if all goes as planned, the partnership may be extended.
“This agreement increases security for our farmers. Sometimes our farmers struggle because the price can drop to 3,500 riel per kilogram, and sometimes it can go as high as 5,000 riel. With this agreement, we know we will get 4,500 riel during the whole season, and we have a guaranteed market,” Mr Hor added.