Cambodia has resolved to give further impetus to milled-rice exports to European markets, while improving economic ties with the EU.
Minister of Commerce Pan Sorasak presented the plan to exporters at a Government-Private Sector Meeting – under the Government-Private Sector Forum (G-PSF) – held at the commerce ministry on February 22 to discuss ways to prop up the rice sector, according to a ministry statement.
The minister underlined the importance of the private sector’s role in finding and sharing practical ways to support the Kingdom’s products as well as giving them a better foothold in foreign markets, especially when it comes to Cambodian-grown milled rice in the EU.
And the Cambodia Rice Federation (CRF), the Kingdom’s apex rice industry body, is to keep tabs on the sources, quantities and prices of milled rice, as well as evaluate linked implementation mechanisms, for an appropriate response to be developed so as to optimise conditions for the sale of the local grains to the EU market, Sorasak suggested.
He recommended the CRF and broader private sector step up cooperation with the EU and related partners as a means to improve the Cambodian rice sector. He offered the exchange of market information, export requirements, and important experiences as a possible avenue.
Sok Puthyvuth, CRF honorary president and co-chair of the Private Sector Working Group I (PSWG-I) on rice under the G-PSF, spoke about the potential of overseas sales of Cambodian rice – whether milled or not – especially to the EU market, according to the statement.
He said that the CRF and EU have developed relatively deep partnerships through information exchanges, and cooperated in “all areas” to foster mutual understanding, in particular to gain insight into the Kingdom’s rice sector and pertinent EU market conditions.
Amru Rice (Cambodia) Co Ltd CEO Song Saran told The Post on February 23 that the Kingdom’s milled-rice exports to the EU have been growing steadily since import duties were dropped, but that their momentum has failed to strengthen to 2019 levels.
“The EU is a very important market for the Cambodian rice sector, leading our farmers to produce more fragrant and organic rice with a focus on the European market,” he said, adding that zero import duty has allowed prices of Cambodian-grown fragrant rice to fall below counterparts from elsewhere.
In 2023, the local community will endeavour to ramp up milled-rice exports to Europe, and invite European buyers for a visit to the Kingdom, he stated.
For context, the European Commission (EC), the EU’s executive arm, introduced tariffs on exports of milled and semi-milled Indica rice from Cambodia and Myanmar that took effect in January 2019, after an investigation indicated that a considerable rise in these imports were causing significant economic damage to EU producers.
The probe followed protests from Italy and Spain, which are top exporters of milled rice to Europe.
Expiring in January 2022, the safeguard regulations required Cambodia to pay import duty of €175 ($186) per tonne in the first year, €150 per tonne in the second, and €125 per tonne in the third.
In Case T‑246/19, the General Court (ECG) of the Court of Justice of the EU (CJEU) on November 9, 2022 ruled that the import duties were illegal and that the investigation had not gathered sufficient evidence, and annulled the EC’s January 16, 2019 implementing regulation 2019/67 that imposed the safeguard measures.
CRF statistics show that Cambodia formally exported 36,900 tonnes of milled rice valued at $28.83 million to 34 markets in the first month of the year, with the EU buying 17,795 tonnes or 48.2 per cent of the total, marking a 41.9 per cent increase from 12,542 tonnes in January 2022.
Last month’s total represented a decline from 53,036 tonnes worth $35.72 million in January 2022 – 30.4 per cent and 19.3 per cent in terms of tonnage and value – as exports to mainland China and Hong Kong more than halved on-year.
The grains went to 20 countries in the EU (17,795 tonnes worth $13.44 million), mainland China and Hong Kong (15,045 tonnes; $11.77 million), Malaysia and Singapore in ASEAN (1,871 tonnes; $1.09 million), and Gabon, the US, Canada, Australia, New Zealand, Russia and Saudi Arabia (2,189 tonnes; $2.53 million).
Broken down by variety, premium aromatic “Malys Angkor” branded rice represented the lion’s share at 22,810 tonnes, followed by Sen Kra’op (SKO) fragrant (9,358 tonnes), white (1,721 tonnes), parboiled (1,867 tonnes) and organic (1,144 tonnes).
Additionally, the Kingdom exported 252,714 tonnes of paddy in January, the CRF said in a recent report, without mentioning their value. However, other statistics provided in the report suggest that the figure falls in the range of $62.665-63.675 million.
This puts the average per-kg value of January’s milled and paddy rice exports at 78 US cents and 25 US cents, respectively, compared to the corresponding figures for full-year 2022 of 65.0 US cents and 24.18 US cents, according to CRF data.