Agro-industry hurt by lack of processing

Wednesday, 02 June 2010 15:02 Catherine James

via Caai nEWS Media

ALACK of domestic processing plants is preventing Cambodian agriculture exports from directly reaching end-market buyers and allowing its neighbours Thailand and Vietnam to reap the economic benefits of the Kingdom’s harvests, a senior Ministry of Commerce official told delegates at a two-day government-backed trade-facilitation workshop that opened Tuesday.

A dearth of processing plants means that Cambodia’s agricultural industry is neither recognised nor rewarded adequately for its produce, MoC Secretary of State Mao Thora said.

He pointed to Cambodia’s cashew nut and cassava industries, which are struggling because processing is done in Vietnam and Thailand before they are sold on to the end-market buyer.

He said Vietnam exported 16,000 tonnes of Cambodian cashew nuts last year, becoming one of the world’s top cashew nut suppliers, while Cambodia was not ranked at all.

Similarly, Cambodian cassava was taken to plants in Thailand and Vietnam, which then sold the produce to China for more than double the buying price.

“I asked a delegation to examine this issue in China, and they didn’t even know the cassava was originally from Cambodia,” he said. “They bought it for US$190 to $200 a tonne, but Vietnam and Thailand bought it [from Cambodia] for $80 to $90 per tonne.”

Similarly, Cambodia officially exported 15,000 tonnes of rice last year, when it had an export potential of 2.25 million tonnes, he said.

However, it apparently failed export standards under the World Trade Organisation’s Sanitary and Phytosanitary (SPS) agreement governing trade in food, animal and plant produce, Mao Thora said.

His comments received support from delegates, with one Cambodian official saying: “The issue here is direct market access.

“I think if we’re going to discuss trade facilitation, we should consider pushing farmers produce directly to the end-market buyer,” Ministry of Agriculture, Forestry and Fisheries Deputy Secretary General Sen Sovann said.