Cambodia encourages more investment in rubber

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Posted 01/05/2010

(CAAI News Media)

PHNOM PENH, Jan 05, 2010 (Xinhua via COMTEX) -- The Cambodian government is urging more investment in rubber plantations in the country to take advantage of high prices on global markets, local media reported on Wednesday.

Ly Phlla, director general of the General Department of Rubber under the Ministry of Agriculture, Forestry and Fisheries, was quoted by the Phnom Penh Post as saying that rubber was now fetching around 2,800 U.S. dollars per ton, up from 1,000 U.S. dollars per ton early last year.

"There is high demand for rubber on the global market, so we need more investment in the sector. Whoever wants to plant, we welcome them," he said, adding that investment in rubber plantations has no negative impact on local farmers.

Prices for rubber in Cambodia have soared in the latter half of the year, reaching 1,918 U.S. dollars per ton in October, 2,435 U. S. dollars per ton in November and about 2,800 U.S. dollars at the end of December 2009, Ly Phalla said.

The increase came as demand for robber soared on the global market amid expectations that manufacturing may recover from a slow 2009 as the U.S. economy began to "sing" in recovery, he said, adding that rising oil prices also contributed.

Cambodia currently has 123,000 hectares of rubber plantations and is expected to have 150,000 hectares under rubber by the end of this year, according to Ly Phalla.

However, Cambodian Rubbet Association President Mak Kimhong said he expected the area under plantation to exceed government estimates, with Vietnamese investors in particular beating a path to the country.

Cambodia signed a memorandum of understanding in November with the Vietnam Rubber Group in Cambodia, a consortium of 14 Vietnamese firms that plan to invest 600 million U.S. dollars in Cambodia's rubber sector by 2012.

Mok Kimhong, who has 15,000 hectares in rubber in Kampong Cham province, 7,000 of which is currently producing, said most rubber exports already go to Vietnam. The rest goes to Malaysia, Thailand and Singapore, with some bought by Germany and France. Mok Kimhong said he exported around 9,000 tons of natural resin to Vietnam last year.

Official export figures of resin were not available Tuesday but Ly Phalla previously said Cambodia exported 50,000 tons last year and 40,000 tons in 2008.