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Rice exports down slightly

Sum Manet / Khmer Times Share:
Workers package milled rice for export. KT/Chor Sokunthear

Exports of rice last year declined slightly, according to a report issued yesterday by the Secretariat of One Window Service for Rice Export Formality (SOWS-REF).

Cambodia exported 626,225 tonnes of rice to international markets in 2018, a drop of 1.5 percent compared to 2017.

Local firms exported mainly three types of rice: fragrant rice (493,597 tonnes shipped, or 78.82 percent of total rice exports), long-grain white rice (105,990 tonnes, or 16.93 percent), and long-grain parboiled rice (26,638 tonnes, or 4.25 percent).

The largest market for Cambodian rice continues to be the European Union, which imported almost 270,000 tonnes, equivalent to 42.98 percent of total exports.

By individual country, the largest buyer was China (170,000 tonnes), followed by France (90,000 tonnes), Malaysia (40,000 tonnes), Gabon (30,000 tonnes), and the Netherlands (26,000 tonnes).

Hun Lak, vice president of the Cambodia Rice Federation, said throughout the year exports were significantly lower than in 2017, but that a high volume of shipments in December helped close the gap.

“We thought that the fall in rice exports would be bigger than 1.5 percent because this year we had only one harvest for our first-grade rice,” he said, noting, however, that total export value was unchanged compared to 2017 because fragrant rice fetched a high price in the international market.

High-quality fragrant rice now sells for $885 per ton, while the lower quality one fetches $750, according to Mr Lak.

In 2018, producers complained of high production costs that limited their ability to purchase seeds. This, in turn, meant rice millers did not have enough rice to process and export.

“For 2019, the government has agreed to lower electricity costs which will be a good thing for the sector. This year we will also have more storage facilities. The big issue now remains transportation costs,” Mr Lak said.

Players in the local rice sector are still awaiting the EU’s final say on whether it imposes tariffs on Cambodian rice. A final decision is due on Jan 15.

Mr Lak said the safeguard investigation into whether Cambodian rice imports affect European farmers was launched by Italy and Spain, who wanted to protect their own rice sectors.

“The tariffs will make our rice in the European market very uncompetitive.

“If these tariffs are approved, we will have to shift our focus from the EU market to other countries. We are trying to diversify into markets like China,” Mr Lak said, adding that Cambodia needs to continue lowering production and transportation costs while improving the quality of its products.

Earlier this week, Khmer Times reported that uncertainty in the tariff issue was causing the delay of rice shipments abroad, with overseas buyers reluctant to go ahead with exchanges.

Chan Sokheang, chairman and CEO of local rice exporter Signatures of Asia, said “Due to this uncertainty, buyers are delaying shipments. They are waiting for EC’s decision.

“If the EU activates the tariffs, many buyers will cancel their orders and our rice sector will be hurt.”

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