Wholesale markets aim to stabilise prices
Wholesale markets aim to stabilise prices
Cambodia's agricultural sector, heavily reliant on exporting raw materials to global markets, has long suffered from unstable pricing. To address this, the government, through the Ministry of Commerce, is planning to establish wholesale markets across the nation in a move to normalise prices and expand market opportunities for farmers, who are the most vulnerable to price speculation by brokers.
Ministry secretary of state Seang Thay recently chaired the inaugural meeting of the Working Group for the Feasibility Study of Establishing Wholesale Markets in the Capital and Provinces.
According to a press release on the outcome of the January 23 meeting, the group is composed of representatives of various specialist departments within the ministry, as well as officials from capital-provincial commerce departments.
“The working group was established to explore the feasibility of setting up nationwide wholesale markets … under the ministry’s oversight. These markets are intended for the buying and selling of agricultural products, with a goal to alleviate product congestion during harvest seasons,” it said.
In 2023, Cambodia exported over 8.449 billion tonnes of agricultural products, a slight decrease of 1.9% compared to 2022.
The exports generated more than $4.306 billion, with milled rice shipments valued at over $567 million, unmilled paddy rice at $939 million and other agricultural products totalling over $2.799 billion, according to the Ministry of Agriculture, Forestry and Fisheries.
Enhancing market efficiency and stability
Penn Sovicheat, spokesperson for the ministry, told The Post on January 25 that the markets will focus on products such as vegetables, fruits, fish and other crops.
“Our goal is to alleviate congestion during the harvest season and contribute to price stability. We are prioritising high-production provinces to facilitate sales management and easy distribution to less productive areas. This approach aims to prevent congestion that can lead to price increases,” he stated.
Sovicheat noted that the ministry will examine the establishment of necessary infrastructure to ensure effective implementation. This includes aspects such as product transportation, sales, distribution, selection, packaging and more.
“We are very optimistic about the success of this new initiative. The minister has instructed the working group to conduct a thorough study, drawing on the successful experiences of neighbouring countries that have already implemented similar projects,” he said.
“Farmers, producers, wholesalers, retailers and consumers will all benefit from this initiative with confidence and a clear guarantee of product quality. It ensures the sustainability of safe supply sources, which will undergo strict inspection by the competent authorities. The commerce ministry is encouraging the private sector and development partners to support and collaboratively achieve the initiative,” Sovicheat added.
Song Saran, CEO of Amru Rice (Cambodia) Co Ltd, a leading producer and exporter of milled rice in the country, welcomed the initiative, noting its potential to open up domestic markets for agricultural products and address pricing issues that farmers routinely face during harvest seasons.
“We fully support establishing a wholesale market for the agricultural sector. Although we produce a great deal, we lack a centralised market to consolidate these products. From a business perspective, a wholesale market not only stabilises prices for farmers but also creates a hub where buyers can ascertain our stock levels for each crop, potentially attracting more buyers,” he said.
Ky Sereyvath, an economic researcher at the Royal Academy of Cambodia, also highlighted the wholesale market’s vital role in managing price fluctuations, particularly during harvest seasons when farmers often struggle due to lack of market access.
“We view this as an excellent initiative that will act as a catalyst for the sector, stabilising prices and establishing a central location where both local and foreign buyers can purchase and negotiate prices, as we consolidate crops from across the country” he said.
Diverse agri-exports bolster nat’l economy
The ministry’s report detailed a wide range of agricultural products classified under the “other” category.
This included 1.2 million tonnes of dried cassava chips, 1.9 million of fresh cassava, over 36,000 of cassava flour, more than 74,000 of cassava waste and upwards of 420,000 of cashew nuts.
The report also highlighted exports of over 71,000 tonnes of corn, more than 28,000 of catjang seeds and over 54,000 of soybean seeds.
Fruit exports encompassed nearly 290,000 tonnes of fresh bananas, over 160,000 of fresh mangoes, more than 27,000 of dried mango and over 17,000 of fresh longans.
The country also exported over 79,000 tonnes of palm oil, in excess of 6,000 of pepper and over 220 of assorted vegetables, as well as nearly 540,000 tonnes across 100 other agricultural products.
“In 2023, farmers cultivated 554,210ha of dry-season rice, approximately 111.25% of the planned 498,170ha. To support this, we implemented emergency rescue measures to encourage production, cultivation and animal rearing, which were actively embraced by farmers,” said the ministry.
