Xekong maize exports set to double
Xekong maize exports set to double
A major corn plantation investor in Xekong province will export 4,000 tonnes of the crop to markets in Vietnam and Malaysia this year, up from 2,000 tonnes in 2013.
Mekhong Joint Venture Company is a big maize producer and promoter in Xekong, the southern province of Laos. The company was conceded 86 hectares of land in Lamam district to plant the crop and build a drying factory and also encouraged villages in and around the district to produce corn and supply to the company.
The firm's Deputy Director Mrs Thingkham Vongsa told Vientiane Times on Thursday “The company's market is very large in Vietnam and their purchasing power is very strong there.”
Last year, the firm's commodities were shipped to Vietnam only, but this year the company will expand its market to Malaysia, another Asean member country.
Mrs Thingkham said “We have signed contacts with buyers from the two countries.”
She confirmed that the export of 3,000 – 4,000 tonnes will not have problem selling in these markets this year because of strong demand.
In 2013, the company earned about 1.5 billion kip from selling of 2,000 tonnes of corn to buyers in domestic and overseas markets.
The company set up the business in Lamam district in 2012 completing the construction of a drying factory in December the same year.
Last year, the company harvested 1,000 tonnes from its farm on 80 hectares and also bought 1,400 tonnes from farmers in the province and the neighbouring province of Saravan.
Farmers in Lamam and Thataeng districts are big suppliers of corn to the firm after they were encouraged to participate in the company's project.
The area of maize under crop in Lamam district is 400 hectares and 600 hectares in Thataeng district with all these areas are owned by local people.
The company will not classify the of maize when it buys from farmers as it purchases at the same price.
At the beginning of this year the lowest market price of corn was 880 kip per kilogram but that is expected to increase to 1,200 kip per kilogram at the end of the year due to the lack of supply.
Mrs Thingkham expects the company will begin seeing a profit of 2 billion kip from the current maize project in 2016.
Many maize exporters in Laos have focused on markets in Vietnam and China after uncertainty with the market in Thailand when the government there temporally suspended the import of maize from Laos a few years ago.
Mekhong is a joint venture company between Vietnamese and Lao business people with Vietnamese investors holding 90 percent and 10 percent in local hands. The headquarters of the company is located in Ho Chi Minh City, Vietnam.
Last year, Vietnam imported 2 million tonnes of maize from Brazil, India and USA, she said.
According to the company's plan it will carry out three main projects in Xekong province.
The first project is maize production and building a drying factory. This activity has been implemented. The second project is to conduct a livestock farm and the third is the construction of an animal feed factory.
The company has set a budget of more than US$4.69 million for these activities and all of them are expected to be completed in 2018.
Mrs Thingkham said that so far the company has already spent 18 billion kip on the first project.
Maize was Laos' second highest income earner among all exports of agricultural products in 2012. It earned US$55 million, behind coffee at about US$60 million last year while rice was the third with about US$10 million.
vientiane times
