In a bid to diversify market destination for rice export, Prime Minister Hun Sen has encouraged Bangladesh investors to consider building a rice warehouse and silo, in a move to increase rice exports to the country.
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The plan was discussed during a meeting between Prime Minister Hun Sen and the Bangladesh Member of Parliament Muhamamad Faruk Khan in Phnom Penh this week, whilst the two countries were seeking to strengthen ties.
“Having learnt that rice demand of the Bangladesh market, my suggestion is that Bangladesh investors should come and invest in building rice warehouses and silos here in Cambodia where they can buy the grain directly from farmers and export to the market,” Mr Hun Sen said.
He explained that this is a good way to enable Cambodia’s rice to be competitively priced with others when they tap into the market. “Cambodian rice is gaining popularity in the global market, so in that sense, our rice is guaranteed for quality and safety.”
The countries signed a deal in 2017 allowing the Kingdom to export one million tonnes of milled rice to its market over five years.
According to the agreement, each year Cambodia exports 250,000 tonnes of milled rice – 200,000 tons of white rice and 50,000 tonnes of parboiled rice per year.
The spokesperson at the Ministry of Commerce could not be reached to confirm how the progress of the deal has come.
The Kingdom has exported a total of 620,106 tonnes of milled rice last year, down 1 percent compared to 2018, according to the Cambodia Rice Federation’s latest report obtained by Khmer Times this week.
The market destinations for Cambodian rice are mainly the European Union, ASEAN and China, however, the Kingdom is still unable to meet its rice export quota in the market last year, shipping only 248,105 tonnes out of the 300,000 allowed.
The report noted that Cambodia experienced a 25 percent decrease in exporting its rice to the EU market in 2019, as a result of the EU’s safeguard measure initiative imposed on rice from the country that it says are hurting farmers in Europe.
During the first year, the EU will levy 175€ ($199.5) per tonne on imports of Cambodian rice, 150€ ($171) in the second year, and 125€ ($142.5) in the last.
Cambodia Rice Federation’s secretary-general Lun Yeng said that Cambodian rice would enjoy a slight increase in the European bloc this year, because the tariff will stand at $171 per tonne, which is lower than 2019.
For the Asean market, he said Cambodian rice will still sell well in Malaysia and Brunei, but the Kingdom has to consider sending fragrant rice to the Philippines – where currently only Vietnam and Thailand have been distributing to the outside markets.