[PHNOM PENH POST]
THE Philippines’ National Food Authority aims to begin importing
Cambodian rice “at the very latest next year”, though experts say the
domestic rice industry must overcome hurdles as it aims to become a
major exporter of the staple crop.
NFA officials met with
Cambodian counterparts earlier this month on a fact-finding mission,
aiming to sign an updated Memorandum of Understanding for rice shipments
to the Philippines, according to NFA Chief of Staff Gilbert Lauengco.
Thailand
and Vietnam – the world’s largest and second-largest exporters of rice,
according to the Food and Agriculture Organisation – currently supply
much of the Philippines’ needs, he said, but added, “We are studying the
possibility of Cambodia as an alternate source [of imports].”
Last
month, Reuters news service claimed the Philippines planned to import
1.3 million tonnes this year. But experts say Cambodia faces key
challenges to tap this demand, particularly in competing with its
established neighbours.
Cambodian Centre for Study and
Development in Agriculture President Yang Saing Koma said the
Philippines generally imports from Thailand or Vietnam, based on prices.
“Cambodia needs to compete with Vietnam and Thailand in terms of price and quality,” he said.
Several
countries are interested in Cambodia’s rice – including the Philippines
as well as China, Bangladesh and nations in the Middle East and Africa –
but productivity needs to be increased to meet this demand.
Gordon
Peters, Senior Consultant at Emerging Markets Consulting, said the
Philippines was a major importer, accounting for 8 percent of the
world’s total last year.
“A strategic relationship with the
Philippines as a Cambodian rice buyer is a great sign for Cambodia’s
long-term rice export plans,” he said.
“There’s an opportunity to
create a Cambodian brand since one of the major buyers is looking at
the Cambodian product,” he said. “This can be leveraged into other
markets as Cambodia begins to see results from its national rice
strategy and increases in yields and export-quality rice.”
However,
Cambodia’s rice production was more costly than its neighbours due to
excessive electricity costs, as well as a somewhat higher cost of doing
business. “This includes infrastructure and logistics, and soft costs
such as time spent waiting at the border,” said Peters.
Prime
Minister Hun Sen has made increasing rice exports an administration
priority, targeting exports of 1 million tonnes of milled rice by 2015.
Phou
Poy, President of the Cambodian Rice Millers Association, said the
Philippines indicated its interest in buying its rice, but had not yet
specified a time frame. Manila would aim to import hundreds of thousands
of tonnes from Cambodia, beyond the Kingdom’s current milling capacity,
he said.
“They may be reluctant to buy from us, and seek to buy
from other countries that can supply rice in large amounts,” said Phou
Poy.
Gilbert Lauengco said milling capacity could be improved in
Cambodia, though it could at present provide “certain amounts” to the
NFA. He declined to reveal the amounts the authority requested from
Cambodia. “We can’t give an actual number – it’s based on the
shortfall,” he said.
The National Food Authority was also
considering providing milling facilities to the Kingdom. It aimed to
sign an updated Memorandum of Understanding with either the Ministry of
Commerce or the Ministry of Agriculture, Forestry and Fisheries – after
having talks with both, he said.
The Philippines had been
overtaken by Indonesia as the world’s largest rice importer by volumes,
he claimed, but added that even as Manila aimed to improve domestic
production of rice, it would likely need to continue imports for at
least three years.
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