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Source: Khmer Times

04/05/2016 – The Cambodia Rice Federation (CRF) yesterday called on local rice millers, exporters, farmers, development partners and the Ministry of Agriculture to work together to promote contract farming to ensure the sustainable development of the rice industry of the country.
 

Sok Puthy Vuth, chairman of CRF, told Khmer Times that the federation had a meeting with concerned parties yesterday to seek recommendations and ideas and to map out the challenges for millers and farmers who have already been doing contract farming and to set a clear role for the CRF to promote the scheme.
 

“This morning, we meet all of them to see the problems and successes and to set a clear policy to implement the scheme,” said Mr. Puthy Vuth.
 

“As we are from the federation, we had not set a clear policy on the issue because in the past, we didn’t have our network or staff close to the farming community, although we had had many discussions with them and now we want to hear from them about exactly what role should we play,” he said.
 

Chan Sokheang, the CEO of Signatures of Asia, a local rice miller and exporter, told Khmer Times that his company had been implementing a policy with a few areas in two provinces – Banteay Meanchey and Siem Reap – for one year, but many challenges still have to be dealt with.
 

“We just started to work on the scheme and we are trying to build trust between each other,” said Mr. Sokheang.  
 

“When you look at the scheme it is good, but when we started implementing we faced many challenges – like building trust between each other, the fluctuation in the market prices and the quality of the paddy rice. Now we are at the stage of learning from each other and I think we need time for that,” he added.
 

Song Saran is a successful rice miller who implemented the scheme in 2013. He is the managing director of Amru Rice (Cambodia) and told Khmer Times that his company had implemented a sustainable contract rice farming project in 2013 with few agriculture cooperatives involved and with 200 farmer families in Preah Vihear province.
 

He said the project had helped alleviate poverty among the farmers, and there are about 28 agriculture cooperatives involved with 4,000 farmers who will be considered in Amru’s contract farming. It will make up approximately 20 percent of the total volume of Amru’s rice.
 

“Contract farming is the key linkage among rice producers, rice millers and exporters. It is a vital part of improving the quality of rice as well as traceability. It has a huge impact on the living standards of the rice producers with guaranteed markets and prices,” said Mr. Saran.
 

“We will continue to expand year-by-year until reaching 50 percent of our total export volume by 2020,” he said. He added that Amru Rice has determined that farmers in Preah Vihear, Svay Rieng, Mondulkiri, Kratie, Kampong Cham, Kampong Thom, Pursat, Banteay Meachey and Battambang are interested in getting involved in contract farming.   
 

The contract farming volume will increase to 10,000 tons in 2016, 15,000 tons in 2017 and 40,000 ton by 2020, he said.
 

“The farmers are guaranteed a price, improved quality of paddy, reduced costs through financing and receive a premier price,” he said.
 

Ieng Sophalet, a spokesman at the Ministry of Agriculture, Forestry and Fisheries, said contract farming is one way to boost farmers’ incomes.
 

“Many farmers only have a landlord, and some of them don’t have the capital to buy things like fertilizer and seeds, but with contact farming they receive a budget to buy seeds and fertilizer,” he said.
 

“Importantly, when their products are harvested, the farmers already have a market for their products,” Mr. Sophalet added. “Contract farming is a win-win policy for farmers and traders.”
 

Mr. Sophalet said the agriculture ministry is encouraging all farmers to get into contract farming.
 

However, Mr. Puthy Vuth of the federation said not many millers are working on the scheme due to a lack of trust with farmers and millers over contracts.
 

“We don’t have many rice millers who have been working on this scheme,” he said.
 

“At the same time, we also heard there are a lot of challenges implementing the policy and they have a lot of work to do with farmers, so they need to have a clear process in order to build trust between farmers and themselves.
 

“That’s why we at the federation want to set a clear policy to deal with the issues before we jump in.
 

“Now we are trying to collaborate with all concerned parties over the issues because it is a very good scheme. Now we want to make sure who will lead the scheme, whether it be the federation, development partners or the Ministry of Agriculture,” Mr. Puthy Vuth added.
 

Mr. Saran recommended other millers who wished to work on the scheme that they need to have a good model and market for this project.
 

“There is a high risk of failure in case of an inaccessible market,” he said.
 

“We have done organic rice since 2013 and the lessons learned and the model encouraged us to go for a conventional contract farming trial in 2016,” he said.
 

“We expect to have results for conventional contract farming by the end of 2016, and we will look at the challenges to address before continuing in 2017 on a larger scale.” Additional reporting by Chea Vannak.