The Cambodia Rice Federation (CRF) has asked the Agriculture and Rural Development Bank (ARDB) to release more funds and requested an extension to the loan cycle repayments, blaming an adjustment in the harvest season.
The request was made during a meeting to discuss the current situation of the rice market and harvest in order to study the possibility of providing loans from the government.
Song Saran, president of the CRF, raised various proposals
as well as some of the challenges that the private sector in the rice sector is facing.
“We want the loan cycle extending up to 11 or 12 months because we want the use of loans to be more efficient to help farmers,” he said.
Saran said the reason to extend the loan cycle is to adjust to climate change which he said has delayed the harvesting of rice paddy this year. He said in July last year, millers had already collected rice paddy from farmers but this year it will be delayed until September.
“We are now facing climate change and that is making us miss the harvest seasonal target, so we need a longer loan cycle that will make it easier for rice millers to have time to collect rice paddy at a fair price,” he said
Kao Thach, general director of the state-run ARDB, said the bank has yet to make a decision.
“Because it is a government fund, we need to submit the request to the government for approval,” he said.
Thach said previously the private sector that provided loans needed them paid back during May and June each year.
Saran said with the target of exporting 800,000 tonnes of rice this year, the government needs to inject between $80 million to $100 million while the private sector needs to have reserves of about $200 million.
“So we need about $300 million to buy rice paddy during this year to reach our target of 800,000 tonnes,” he said, adding that both state and private sector need to inject more money to reach the ultimate target of 1 million tonnes.
In March this year, the government via the ARDB allocated a $50 million special fund for small and medium enterprises. The fund is designed to specifically focus on agri-processing, food processing, agri-business, crops including vegetables, livestock and the aquatic business plus any enterprise that uses raw materials from agriculture.
Cambodia’s rice exports increased by 42 percent in the first six months of the year, according to a report from the Ministry of Agriculture, Forestry and Fisheries.
Cambodia sent 397,660 tonnes of milled rice from January to June this year, an increase of 42.25 percent, compared with 281,538 tonnes in 2019, according to the report.
Rice exports to the EU increased by more than 45 percent. To China they rose by 25.20 percent. Asean countries increased imports by about 47.7 percent and other market destinations surged by 79.26 percent.