Milled rice to Philippines set for boost
Milled rice to Philippines set for boost
As one of the leading milled rice exporting countries in the region, Cambodia is aiming to expand its exports to the Philippines, following the recent commitment by both nations’ leaders to spur bilateral trade relations.
Cambodia and the archipelagic county have mutually agreed to enhance their relations and cooperation, especially in trade and airway connectivity, acknowledging the benefits of their collaboration.
The agreement was reached during a meeting between Prime Minister Hun Manet and Philippine President Ferdinand Romualdez Marcos Jr on March 4, on the sidelines of the ASEAN-Australia Special Summit in Melbourne, Australia, as detailed on the former’s social media.
Both sides agreed to promote the export of Cambodian milled rice to the Philippines and foster connections between their respective private sectors, aiming to boost bilateral trade ties.
Lun Yeng, secretary-general of the Cambodia Rice Federation (CRF) – the nation’s apex rice industry body – told The Post on March 13 that the Kingdom exported a small quantity of milled rice to the Philippines last year.
“The Philippines is a potential market for our milled rice as they import over 3 million tonnes annually for domestic consumption. Last year’s export was about 5,000 tonnes, which is still a small amount,” he explained.
“I have noticed a positive trend in exports to the Philippines, as demand in the market is growing. Consequently, we expect our exports to increase in the coming years,” he added.
CRF president Chan Sokheang previously told The Post that the Philippines is not only a rice producer but also a major importer, with 3.82 million tonnes imported in 2022.
Sokheang stated that the federation aims to capture a market share of approximately 100,000 tonnes.
“In 2022, Cambodia exported only about 100 tonnes, as the market remains highly competitive. We are in talks with shipping companies to reduce costs and boost exports,” he said.
“We are considering the possibility of exporting up to 100,000 tonnes annually. The reason for our limited previous exports to the Philippines is the highly competitive nature of the market. Even Thailand exports only a small amount to the Philippines,” he added.
In June, the CRF announced that Cambodia had made its first significant export of 2,575 tonnes of rice to the Philippines.
“The first exports of milled rice to the Philippines are a success story in accessing new markets. It is important to highlight that the Philippines imports almost four million tonnes of milled rice annually,” Sokheang said.
Kim Savuth, chairman of Khmer Foods Group, remarked that following exports to the nation, there has been an increase in demand for Cambodia’s milled rice there.
However, he said his company is grappling with financial challenges related to purchasing paddy rice for storage before processing.
“We have received many orders for our milled rice, but the issue we face is the working capital needed to buy paddy rice for stockpiling. This limitation hampers our ability to increase exports.
“Another issue is the rising price of paddy rice, which affects our capacity to purchase from our farmers,” he said.
Price stabilization funds allocated
The state-owned Agricultural and Rural Development Bank (ARDB) has set aside approximately $100 million for the government’s special financing programme to stabilise agricultural prices during this year’s harvest season.
ARDB CEO Kao Thach told The Post in February that the government, through the bank, has reserved the funds to boost production and market accessibility.
“The programme is a crucial government intervention to stabilise agricultural commodity prices. Particularly for the rice sector, the aim is to support potential rice millers or exporters by providing working capital financing.
This assistance helps them purchase rice from farmers, contributing to price stability and enhancing Cambodia’s food security and export potential,” he explained.
“The fund is allocated for the current year and is meant for disbursement during price fluctuations in the harvest season. As of now, no funds have been distributed,” he added.
According to the CRF, approximately 656,323 tonnes of milled rice were exported to international markets in 2023, marking a 3% increase compared to 2022.
The exports generated $466 million in revenue, a 13% rise from the previous year. Cambodian milled rice reached 61 countries and territories through 63 exporters.
Exports of milled rice to mainland China and its Hong Kong Autonomous Region totalled 212,756 tonnes in 2023, valued at $138 million. Across 26 European countries, exports amounted to 264,683 tonnes, equivalent to $191 million. Seven ASEAN member countries received 93,376 tonnes, valued at $62 million.
Exports to various destinations in the Middle East and Africa, covering 26 countries, totalled 85,508 tonnes, worth $76 million, as per the CRF.
In addition to milled rice, Cambodia exported 4,387,363 tonnes of paddy rice in 2023, valued at approximately $1.32 billion. Of this, 64% was exported with certification from relevant authorities.
Paddy rice exports saw an increase of around 26.5%, with their value rising by approximately 56.69% compared to 2022, as per the General Department of Customs and Excise (GDCE).
