More Rice Bound for China

KHMER TIMES
SOK CHAN

Cambodia Commerce Minister Pan Sorasak (left) concludes a bilateral agreement on rice with China’s Commerce Minister Gao Hucheng. Supplied

China plans to increase its rice import quota from Cambodia next year as the Kingdom braces for possible cutbacks by the European Union (EU) to limit milled rice imports from least developed countries (LDCs).

Minister of Commerce Pan Sorasak said yesterday that his Chinese counterpart Gao Hucheng agreed at a bilateral trade meeting to increase China’s import of milled rice from Cambodia and to review the import quotas every year.

“We have asked China to increase its import quota of milled rice from Cambodia, and now they [China] agreed to what we requested,” said Mr. Sorasak.

“China will import another 200,000 metric tons of milled rice in 2017 on top of their current rice imports from Cambodia. Both sides agreed to review the outcomes of this bilateral trade cooperation every year,” he added.

China’s commerce minister Mr. Gao is currently on an official visit to Cambodia to discuss roads, railways, airport construction, agriculture and other projects with senior government officials.

Cambodia’s request to China comes just after last month’s visit by delegations from the Brussels-based European Commission’s Directorate-General for Agriculture and Rural Development and the Directorate-General for Trade. Both delegations advised Cambodia’s rice industry to seek other markets and not just concentrate its exports to Europe, as the country moves from a low-income country in its LDC status to a lower-middle income nation.

An EU source who did not want to be named told Khmer Times that the visiting delegations from Brussels hinted the EU could limit rice imports from LDCs in the “Everything but Arms” (EBA) trade concessions to about 300,000 to 350,000 tons a year. Both Cambodia and Myanmar are the only LDCs recognized in the EBA trade concessions and rice exports from both countries have unfettered access to EU markets. “This means Cambodia would need to share these new EU quotas with Myanmar in the very near future,” said the source.

Last year, the total amount of Cambodian milled rice exported reached some 538,396 tons, according to the Cambodian Rice Federation, with 43 percent exported to the EU.

Mr. Sorasak, however, was optimistic that the EU would not cut back on its import of milled rice from Cambodia.

“Cambodia still has preferential access to the EU’s rice markets. They [EU] just want to make sure that we export good-quality rice,” said Mr. Sorasak.

Hun Lak, Cambodia Rice Federation’s vice president, told Khmer Times that both China and Cambodia had already agreed on the import quota of 100,000 tons.

Mr. Hun Lak added that it was an opportune moment now, with China agreeing to import more rice from the Kingdom, for Cambodia to make its milled rice competitive in the international market.

“Though the quality of Cambodian rice is good, its price is $60 higher per metric ton compared to a neighboring country,” he added. Though referring to Vietnam, Mr. Hun Lak did not name it outright.

“We have to find a way to lower production costs to keep our rice prices low,” he said.