Trade Sector Wide Approach - Ministry of Commerce · of exporting 1 million metric ton of milled...

Trade Sector Wide Approach

MILLED RICE TECHNICAL ASSISTANCE

IMPROVES QUALITY OF CAMBODIAN RICE

Success Story

CEDEP I - Milled Rice Component

Since 2010, the Royal Government of Cambodia has set a target of 1 million metric tons of rice exports annually—an accomplishment that would put Cambodia in the front rank of world rice exporters. Unlike the government’s overambitious blueprints for many sectors, its rice-export goal seems realistic: the country has a surplus of around 3m tons of un-milled rice after local consumption. Over the past few years Cambodia has made progress in overcoming some of the constraints limiting its rice exports—most notably low milling capacity—but other problems, including small farm sizes, outdated techniques, cultural conservatism and a dearth of credit, still linger.

The description of rice as “White Gold” in Cambodia speaks about its ecnomic and cultural importance. Rice production, processing, and marketing are estimated to employ three million people, or more than 20 percent of the country’s population. Further development of the sector can have direct and positive impact on job creation and income growth in many regions of the country. Rice cultivation has long been of central importance to the Cambodian economy—the medie-val Angkor empire dominated the region on the strength of its agrarian productivity. However, since the collapse of Angkor in the 15th century, rice farming has functioned far below its potential, offering little more than subsistence for many of those involved. As neighboring Vietnam and Thailand have taken their places among the world’s big-gest rice exporters, Cambodia has languished, despite having a conducive climate and the same long history of rice cultivation. Challenges continue to haunt the Cambodian rice sector, specifically in terms of access to improved fragrant rice seeds, shortage of working capital, aggressive competition on international markets, and of not meeting the international rice standards requirement.

In the past, the practice in terms of the support to the agriculture sector was largely based on supply side in the local market, and little attentionwas given to the demand side of the overseas market. Ensuring the quality and safety standards of rice was not given much attention by the industry players. Although, most of the stakeholders in the rice sector were good listeners and work hard to learn new techniques, but it cannot be denied that most of them still lack adequate technical knowledge on better technologies; majority have little financial resource and limited accessto market information; some have very weak and underdeveloped supply chain network, coupled with unclear quality inspection procedures; and few have adopted sub-optimal export procedures. Most of the rice sector participants do not have much experience dealing with the global market, and would require capacity building and transfer of technologies in the area of production inputs and access to credit in the global market. Thus, more comprehensive changes are needed. Most Asian importers and Western markets alike demand high-quality “fragrant” varieties such as jasmine rice. The difficulty of competing with Vietnam on price suggests that Cambodia must try to focus on quality. With sparing use of chemical fertilizer and pesticides, and traditional techniques such as oxen ploughing still in use, Cambodia could capitalize on developed-country demand for sustainable and eco-friendly food. The main danger is that, instead of developing new products and markets, Cambodia’s so-called rice barons will use their power and influence to limit competition. This would mean a gradual return to the large, undifferentiating paddies of Angkor, missing a valuable opportunity to capitalize on Cambodia’s unique strengths.

CAMBODIA’S MILLED RICE TRADE CHALLENGES

1 A Success Story www.moc.gov.kh/tradeswap | Facebook: TDSP & EIF

MINISTRY OF COMMERCE’S INTERVENTION

A timely intervention has been introduced in the Milled Rice Sector. The Royal Government of Cambodia, thru the auspices of the Ministry of Commerce, has

institutionalized the Trade Sector Wide Approach (Trade SWAp) in 2008 as a tool for trade mainstreaming as well as a robust mechanism available to donors for aid delivery in developing the trade sector, focusing on strategies such as export diversification and export led-growth for high economic and social development impact. Within the framework of the Trade SWAp, the Cambodia Export Diversification and Expansion Program (CEDEP) if the first Tier 2 project in Cambodia, aiming to strengthen and expand the exports in key sectors including milled rice and value silk. The MoC commissioned the International Finance Corporation

(IFC) to be the Main Implementing Entity (MIE) for the Milled Rice Component for a period of 3 years.

The CEDEP I- Milled Rice component aims to transform the Cambodian rice market by increasing product quality along the supply chain (from use of high quality seed to improved milling operations and efficiency) and facilitating access to high value export markets. As the MIE of the Milled Rice Component, IFC has programmed the following activities to be carried out within a period of three years: (i) facilitation of dialogues between the Government and milled rice exporters for the possibility of creation of milled rice exporter association and enhancing the discussion on the various issues related to the milled rice sector in the Government and Private Sector Forum (G-PSF);


2A Success Storywww.moc.gov.kh/tradeswap | Facebook: TDSP & EIF

As a result of project activities carried out in the areas of coordination of GPSF dialogues, capacity building for stakeholders in the sector, and the establishment of

CRF to support Cambodian rice export processes, it can be considered that the CEDEP I milled rice component has early reached its project objectives. The project results produced a lot of benefit not only for the private sector who are engaged in the rice export or for the Government, but for Cambodia as whole. To cap the achievements in 2014, Cambodian Rice was voted as “the World’s Best Rice” for the third consecutive year (2012 to 2014) in the Rice Trader’s (TRT) Conference which was held in Cambodia. The 2nd Cambodian Rice Festival and the TRT Conference have attracted approximately 1,700 people from all over the world, which facilitated a total of US$ 37,604,939 of rice exports (50% as fragrant rice), and US$ 74,120,423 of rice export for the entire year of 2014. Aside from these, the other highlights of achievements include: (a) Revised Cambodian Milled Rice Standards approved; (b) First 10 Cambodian rice

mills were HACCP certified; (c) DNA fingerprint of Cambodian fragrant rice varieties established.; and (d) Cambodian rice intensely promoted in different international trade exhibitions, conferences, and other promotional activities such as THAIFEX, TRT, SIAL Paris, Guangzhou Trade Fair, etc.

In terms of Outcome #1 – Enabling Environment for Cambodian Private Rice Sector, the following were achieved: (a) Rice Standards Technical Working Group and Export Promotion Working Group were established; (b) MOU signed between IFC and FCRE; (c) A number of consultations with CRF conducted; (d) Core Team for Rice Component created – started to engage with project activities such as THAIFEX May 2014, 2nd CMB Rice Festival, Guanzhou Trade Fair June 2015, etc.; (e) Revised Milled Rice Standards Approved by MIH (second version); and (f ) On-going capacity building for CRXs with different topics by different key speakers (Subra, Dr. Werner, and Dr. Makara).

For Outcome #2 – Identifying market opportunities, the

INTERVENTION OUTCOMES

(ii) identification of new major import market opportunities by targeting EU and Russia, with the prospect of signing new contracts in the new market for milled rice; and (iii) facilitation of DNA fingerprint analysis of one fragrant rice variety to validate its uniqueness to meet the quantities, quality, and price with Sanitary and Phytosanitary (SPS) standards requested by importers.

With support from various development partners, the Cambodian rice export industry grew rapidly raising expectations around achieving the Government’s objective of exporting 1 million metric ton of milled rice by 2015. The increase in rice exports supports the CEDEP I project objective to increase exports of milled rice by 100% from the 2011 baseline volume of approximately 140,000 MT. In 2013, the EIF rice project directly facilitated 44,671 metric tons of rice exports, which adds up to US$30,520,768 of rice exports, and the export of fragrant rice accounted for more than half of the facilitated exports, higher than the national average.

In growing results in the rice sector, quality has also been fundamental with milling machines taking paddy rice to the next level, increasing profits for farmers and producers. A Rice Production and Milled Rice Export Policy is in place to support the value chain process. Cambodian rice now complies with international quality standards; with major rice export markets including the European Union, Malaysia, Russia and the United States of America.

As a result, Cambodian rice has been showcased in many different international trade fairs. On 19 November 2014 at the Sixth World Rice Conference in Phnom Penh, Cambodia was named as the country with the World’s Best Rice for 2014 along with Thailand. This is an accolade that Cambodia has received for the past three years. Previously, during the global rice tasting competition in 2013, Cambodian Premium Fragrant Rice was awarded the ‘World’s Best Rice’ Award at the World Rice Conference (WRC), for the second straight year in a row. The EIF project provided technical support and facilitation to 43 rice exporters from 26 exporting companies to attend the WRC, which was organized by The Rice Trader (TRT) in Hong Kong, China, from 19 to 21 November 2013. These awards have attracted significant media coverage, and in return, the backing of the Cambodian Government to the rice project initiative taken forward by the Program supported by the EU, the EIF and the IFC. Likewise, in 2012, Cambodian Premium Jasmine Rice ‘Phka Malis’ was awarded the ‘World’s Best Rice’ title and was showcased at the Fourth Global Review of Aid for Trade at the WTO in July 2013.

In Cambodia, there are 2.8 million hectares of cultivated land out of which 84% (2.4 million hectares) is used for rice farming, with the rice sector employing over 2.9 million people. The EIF rice project implemented by IFC looks at addressing the existing challenges in the rice sector and supporting the private sector to meet the Government’s target, identifying new major export markets, and in securing export contracts with premium prices for quality rice.

following were the results: (a) International market studies on Cambodian rice completed and dissemination workshop organized; (b) Participated in international trade exhibitions (THAIFEX 2013 and 2014), and TRT WRC in Hongkong and Cambodia – Cambodia won second and third WBR Award; (c) Promotional events: first and second CRF 2013 and 2014, Cambodia: World Best Rice Cuisine, and business matching with HK Rice Merchants’ Association; (d) Developed and published Cambodian rice portfolio catalogue; (e) Manual on FS developed and training rolled-out; and (e) Working with local education centers to update FS curriculum.

In terms of Outcome #3 – Food Safety Management System and Rice Branding Development and Promotion, the following were the accomplishments: (a) Revised Cambodian Milled Rice standards approved by the Senior Minister of MIH (second version); (b) 10 Cambodian rice mills HACCP Certified – one more expected to be certified by mid-2015; (c) DNA fingerprint of Cambodian fragrant rice varieties established – adopted and issued by CARDI; (d) Branding strategy for Cambodian rice is being developed – based on the findings from the market studies, market missions, and consultations with industry body and EPWG; and (e) Continuous promotion of Cambodian rice in promotional materials, VDO clips, FB page: www.worldsbestrice.biz, Youtube, Global Price Index (LRI).

The CEDEP I Milled Rice component also facilitated nine trade missions and food fairs/exhibitions in some potential importing countries in Europe, USA, Singapore, Thailand, and Hong Kong, and in Cambodia to meet key buyers and sellers. These trade missions and food fairs/exhibitions were participated by 328 exporters and export-ready rice millers, including 18 people for THAIFEX, 43 for TRT/WRC in 2013, 73 for Business Cocktail Network with Hong Kong Merchants Association in Phnom Penh, 46 for THAIFEX 2014, 5 for World Conference on Rice and Grain 2014 in Panama, 25 for SIAL Paris 2014, 76 for 2nd Cambodian Rice festival 2014, and 76 for TRT/WRC 2014. Their participations in these trade missions and exhibitions provided them additional knowledge on the rice market’s demand size, perception of buyers on Cambodian rice, relevant strategies in increasing volume of export and income and other relevant trade processes.

After the trade missions, the participants were able to receive certification in the area of food safety, the Hazard Analysis and Critical Control Points (HACCP), which is provided by the international certification bodies such as TUV Rheinland and Bureau Veritas; and certificate of Occupational Health and Safety (OHS). As a result, approximately 92% of the rice millers reported to have improved their access to international market; while 83% reported to have improved their performance. In response to the unique Cambodian brand name and as

requested by the international market, CEDEP I milled rice component worked closely withthe rice exporters and the Cambodian Agriculture Research and Development Institute (CARDI) in conducting the DNA fingerprint analysis for one fragrant rice variety (Sen Kra Ob).

As part of its trade promotion and institution building activities, the CEDEP I Milled Rice component has also facilitated and coordinated 29 other events inside and

outside of the country in terms of trade promotion missions, trade fairs and training workshop) both inside and outside country, which were participated by 172 exporters, rice millers, core team members and other relevant stakeholders. These events resulted to an improved level of knowledge on the latest on the operation of rice mills, busness cycles in the rice sector, strategic profile of customers and their preferences, required processing standards, commercial restrictions and agreements, and the quota being imposed. Out of the 172 participants, 28 were rice millers and exporters from Phnom Penh, Battambang, Kampong Cham, and Siem Reap. To sustain the institutional and individual capacity building efforts, CEDEP I Milled Rice Component has also transferred the knowledge



BRICO Received GMP, HACCP & OHSAS 18001:2007 Certified Rice Mill



BRICo joined THAIFEX.May 26.2014

and technologies gained from foreign trade missions and food fairs to three universities: Build Bright University (BBU), Kampong Cham National School of Agriculture, and the Royal University of Agriculture (RUA). The Program has supported the development of additional course curriculum in these schools in the areas of safety, Sanitary, Good Manufacturing Practices/Hazard Analysis and Critical Control Points (GMP/HACCP), and Sanitary and Phytosanitary Standards (SPS). Operational Manuals of ISO 22000 were also disseminated to the students.

While Cambodia is preparing its Rice Export Policy, the Program has also facilitated two trade missions and study tours in US and Europe, participated by 29 rice exporters and export-ready rice millers (i.e., 4 for US, and 25 for EU). The study tours were designed to provide fundamental market information in the development of marketing strategies in the rice sector, which are expected to remove key barriers and ensure the competitiveness of Cambodian rice in international markets; additional information on export opportunities and other strategic options in marketing. At the culmination of the study tours, the participants gained countless of additional information, knowledge, and experience that they can use in preparing their export marketing plan, developing new export marketing strategies and tactics, understanding better the customers’ requirements, understanding social responsibility in the area of sustainable farming and responsible sourcing. In improving the standards and quality of milled rice, the partici-pants also learned on the US and Europe’s high purity specifica-tion requirements, Sanitary and Phytosanitary Standards (SPS), the USDA certification requirements, the global food safety initiative certification, and other relevant business policies in

the area of corporate social responsibility, code of conduct/ethics, respect for labor, and green and clean, which are all relevant to help them to improve their working environment.

In May 2014, the Cambodian Rice Federation (CRF) was established under the auspices of the Program, which provides a voice for the Cambodian rice industry, representing rice exporters federation, farmers federation, rice exporting companies, and logistic companies. The CRF was created thru a Sub-Decree with 17 board members to govern the Federation. The website, www.crf.org.kh, provides information on its mandate and other information. Among the early accomplishments of the CRF are the following: (i) Coordinated and integrated the expriences and lesson learned from the various foreign markets visited such as the US, Europe, and the country’s participation in THAIFEX; (ii) Developed business development strategies; (iii) Helped develop and design products and sevices to its members and other interested rice exporting companies; and (iv) Prepared policy papers, focusing on technical support in branding development and promotion for Cambodian rice products.

Under the guidance of CEDEP I Milled Rice Component Team, the CRF conducted several meetings with the private sector to introduce the Program, including discussions with: (i) MoC and the Chinese delegation for possible export of 100,000 metric tons of rice to China; (ii) the Rural Development Bank (RDB) for possible financial support and access to capital to CRF members; (iii) the MoC and MIH to support SMEs for free quota; (iv) the MSEs to convey sector concerns in preparation for the G-PSF, and (v) MoC to possible extension of export to middle east countries.

5 A Success Story

CRF Signed MoU with MoC/Photo.MoC/2015

To advance the Royal Government of Cambodia’s ambition to have 1 million metric tons of milled rice for export by 2015, the Enhanced Integrated Framework, thru CEDEP 1, has supported the rice sector to be more competitive in the global market, with assistance from other development partners such as the European Union, the International Finance Corporation (IFC), and the Agence Francaise de Development (AFD). This includes diversifying exports and adding value to paddy rice, which would in turn lead to bigger profits for everyone along the rice chain, and a boost for rice farmers. An important step was the setting up of the Federation of Cambodian Rice Exporters in June 2012, along-side a growing focus on strengthening the Government-Private Sector Forum (GPSF) dialogue with greater market opportunities opening up for rice millers by adopting SPS standards. At the same time, partnering with civil society organizations such as the Cambodia Agriculture Development and Research Centre (CEDAC) to mobilize communities has been vital going forward to help link the sector from fields to the ports.

Later on in 2014, the Cambodian government officially announced the creation of the Cambodia Rice Federation (CRF) to improve competitiveness, promote trade, and increase investment in the rice sector. Elections for the Chairman and Vice Chairmen of CRF were done on May 19, 2014 under the presidency of H.E. sun Chanthol, Senior Minister and Minister of Commerce. Mr. Sok Pothivuth, Director General of SOMA Group was elected as Chairman while Okhna Kim Sauvth, Okhna Huln Lak and Okhna Lim Bunheng as Vice-Chairmen of the Federation with the chairman having a limit of one term of two years. CRF represents Cambodia’s rice producers, rice export associations, and federations in dealing with the Royal Government Cambodia. The federation will also be able to work with the government in negotiating government

to government contracts with international buyers, and can also work directly with international buyers (private or state- owned) to negotiate sales of Cambodian rice.

CEDEP 1 has supported CRF in conducting several dialogues organized in the Government-Private Sector Forum (G-PSF) and the donor partners (DPs) to find better ways in supporting the Cambodian rice exporters in complying with the various requirements of the importing countries. The dialogues provided important inputs in improving the productivity of Cambodian farmers, in enhancing rice milling techniques, lowering the cost of export processes, upholding the framework of an industry-wide code of conduct. The discussions with the various stakeholders provided additional value that would impact on investment and best practice of the highest technical standards in dealing with customers to protect the long-term quality, reputation and sustainability of the Cambodian rice brand.

The International Finance Corporation (IFC), thru CEDEP I Milled Rice Component, initiated several activities in building up the capacity of CRF’s founding members to ensure that Cambodian rice export is enhanced and sustained. After the various training programs conducted, the CRF members have had the ability to identify issues in the area of trade facilitation, export financing, compliance (quality management), production technology, and design the rice supply to improve Cambodian fragrant rice image. The CRF was able to conduct some dissemination workshops on trade development and investment, resulting for better understanding of the export procedures and in improving the quality of rice that they are exporting. From among the members of the CRF, LORAN and Golden Rice companies won the 2nd World’s Best Rice held in Hong Kong in 2013, and another member won the 3rd WBR, in November 2014 held in Phnom Penh. After winning in the competition,

INDIVIDUAL INSTITUTES AND PRIVATE SECTOR SUCCESS STORYSTORY 1. Cambodian Rice Federation (CRF)


www.moc.gov.kh/tradeswap | Facebook: TDSP & EIF

AMRU Rice, also known as Amret Rungroeung Group Limited, is a private company of milled rice exporters (www.amrurice.com), which provides financing to Cambodian rice farmers, has recently established a production and exporting facility to effectively distribute Cambodian rice to the world market. By focusing on quality control, environmental awareness, and customer service, CEDEP I milled rice component facilitated AMRU Rice to participate in international trade and food fair in Europe and the USA. The experience and lessons learned from the various global market events and trade fairs provided more confidence and trust to AMRU Rice, having evolved from family rice export company to be one of the leading Cambodian rice exporters.

In 2013, AMRU Rice exported nearly 50,000 mt, which is 260% higher compared to 2012. This achievement in rice exportation by AMRU Rice was facilitated by the CEDEP I milled rice component, specifically in having access to new market demand information in Asia, particularly in China, Malaysia, and Europe. AMRU Rice is targeting to export 75,000 mt per year for its jasmine rice, including new product lines: brown rice and packaging line. Recently, AMRU Rice will try to improve the standards of the fragrant jasmine rice by setting up the laboratory to control its quality as per request by importers in some of the international trade fairs that they have participated. The company’s strong background in business, marketing, management, accounting and finance, will further boost and scale up its activities in the export market, with further technical support to be extended by CEDEP 1 Milled Rice Component.

The CEDEP I Milled Rice Component has continued to support several Cambodian rice exporters, most of which are members of Cambodia Rice Federation (CRF). By working with CRF, the CEDEP I Milled Rice component was able to continuously promote Cambodian rice to the global market; by registering Cambodian rice at the Live Rice Index, a global price index;

and by developing a national brand name. The result of these efforts by CRF and the CEDEP 1 Milled Rice Component is the exportation of rice amounting to more than US$74 million to 77 countries, and secured contracts for fragrant rice at a value of more than US$ 53 million for 284 SME rice exporters.

Mr. Song Saran, CEO & President for AMRU Rice Co. Ltd., said that “with the support from IFC -CEDEP I milled rice component, AMRU Rice was able to expand its investment with existing and new customers, participate in food fairs and trade fairs, and recognition of its quality by an ISO certificate.” He further added that

AMRU Rice was also been able to contribute to the poverty reduction by establishing farmer community network in the provinces of Kampong Thom and Battambang as pilot projects. AMRU Rice provided training to farmers on how to use organic fertilizers in their jasmine and paddy rice farming. The farmers were delighted with ARMRU Rice for providing training in the use of organic fertilizers, otherwise, the company would not buy from them if they will not use organic fertilizers since the company only exports organic rice. AMRU Rice buys from the farmers their organic rice at a price higher by around 5 to 10 per cent as compared with others.

STORY 2. AMRU Rice., Co., Ltd

Food Safety Control & Implementing the HACCP Manual. AMRU Rice/October 2014

their volume of exports dramatically increased.

At the Cambodian Rice Festival and The World’s Best Rice Conference, jointly organized by ICF-CEDEP I milled rice component and CRF in November 2014, H.E. SOK Puthyvuth, president of the CRF, said “It was the third year in a row that

Cambodia’s fragrant rice won the award. This is another significant milestone for Cambodia’s rice industry. The award clearly reflects our rice’s high quality and I hope that the reputation of our rice would be better known internationally.”

“

”

looking back in 2008, AMRU Rice was able to export only 1 container per month, but now the company has improved its export volume of jasmine rice to about five containers per week, and not per month as per cycle of previous trading.

Mr. SONG Saran, CEO & President for AMRU Rice Co.Ltd



STORY 3. Battambang Rice Investment., Coltd

We are proud of to be the first GMP and HACCP certified rice mill in Cambodia. These certifications can be used as marketing tools to separate BRICO from the rest of Cambodia’s miller and exporters.” He added that, “I am willing to support the Cambodia government target to meet 1 million metric tons of rice export in 2015 and would like to encourage the international buyers to deal only with Cambodian rice millers that are internationally certified to ensure the quality of the rice they are importing. ”

“

Dried Paddy Rice. BRICo/2015

Battambang Rice Investment Company Ltd (BRICO), a Part-Cambodian-owned joint venture, has recently been certified by the Vietnamese unit of German-based TUV Rheinland as the first rice mill in Cambodia with Good Manufacturing Practices (GMP) and Hazard Analysis and Critical Control Points (HACCP).

BRICO was established in 2012 as a joint venture company with rice exporter Okhna Lim Bun Heng, insurance executive Youk Chamroeunrith, the Cambodia Lao Development Fund, a locally owned importer-exporter Lorana, a Singaporean investor and Emerging Market Investment Fund (EMI). Between them, they invested more than $3.5 million in the rice-milling venture in Battambang province’s Thma Koul district.

“The company’s rice mill, situated on 6.5 hectares of land, was bought from Thailand, with a capacity to process 15 tons of rice per hour” Chamroeunrith said. “The aim of BRICO is to raise the rice standard in terms of quality, consistency, transparency, safety, and hygine, as well as setting up the benchmark for the industry. Our next target is to get Occupational Health and Safety (OHS) and the International Standards Organization (ISO) certification,” Chamroeunrith added.

“Rice is the priority in the agricultural sector that the government is promoting, so we see great potential and a good return on the investment,” he said. “Secondly, most paddy rice is usually sold to neighboring countries because our millers don’t have enough money to buy and our country does not have enough processing facilities. We decided to invest in the sector by bringing high-tech machinery and will buy rice from the farmer,” Chamroeunrith stressed.

In contribution to the country’s poverty reduction, BRICo is

staying engaged and involved with concerned communities through job creation, engagement with local farming community, leading and developing rice with high international standards and practice within the sector in order to be the role model.

Mr. Kunthy Kann, CEO of BRICO Co., Ltd



PROJECT IMPACT

Lot 19 - 16 MoC Road (113 B Road) Phum Teuk Thla, Sangkat Teuk Thla, Khan Sen Sok, Phnom Penh 12102, Kingdom of CambodiaTel/Fax: (855) 23 866 074 | E-mail: [email protected] | Website: www.moc.gov.kh/tradeswap | Facebook: TDSP & EIF


It is too early to make the judgment on the contribution and impact of the CEDEP I Milled Rice component against the Government’s target of exporting one million metric tons of rice by end of 2015. However, at the Program level, CEDEP I’s Milled Rice component has shown its greatest contribution in improving Cambodia’s export volume, in enhancing the quality of paddy rice and in sustaining the efficiency of milling companies, not to mention the improvements made in the area of export marketing. Based on the results of value chain studies that were recently conducted, covering farming, milling and exporting practices, it was reported that about 8,000 farmers have now access to improved inbred planting seed for high value rice variety; 100 rice millers and re-processors are able to improve their management, processing and food safety systems; resulting to a total export volume of US$180 million (50% of rice export is fragrant rice).

The challenges of limited access to fragrant rice seeds, aggressive competition in the international market, and limited access to information in improving the quality and standard of rice as required by the international market were immediately solved through the establishment of Cambodian Rice Federation (CRF). The establishment of CRF happened at the right time in engaging stakeholders in further improving the quality and standard of Cambodian rice for export in response to the requirement of the international market. CRF is now working closely with Cambodian rice exporters and other relevant stakeholders in sharing their knowledge to surmount the challenges in the international market and grab the opportunities in rice export market, armed with the code of conduct prepared by CRF.

The timeframe for the exit strategy of CEDEP 1 in the milled rice sector has been adjusted but is still facing some challenges: (a) Branding strategy needs to be properly implemented, particularly on use and protection, and code of conduct needs to be further developed; and (b) Time to measure the impact from this branding support is too short.

Following each market mission, proper market penetration strategies with follow-up plan need to be developed and implemented to realize the full potential and lessons learned from the recent market missions. Promoting Cambodian rice is really fully depending on a “supply chain” approach, from farm to fork, with implemented linkages between seed growers, farmers, processors, traders, and exporters.

The website of CRF provides regular updates on the volume of rice exported. CRF’s engagement with rice millers and exporters will take time from about 12 to 18 months to show the full impact in terms of market access. However, the gradual increase in the export volume of rice, the improvement in the capacity and knowledge of stakeholders in Cambodian rice sector, and the World’s Best Rice Award for Cambodia three years in row, are enough to prove the positive impact of CEDEP I Milled Rice component. The impact is translated in terms of income generation not only to Cambodian rice millers and exporters, but also to the rice farmers.

Trade Sector Wide Approach - Ministry of Commerce · of exporting 1 million metric ton of milled...

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