Cambodia will export 400,000 tonnes of dried cassava to the Guangxi Zhuang Autonomous Region “from March 2022 to March 2023”, under a new agreement between the Ministry of Commerce and the southwestern Chinese region, according to the ministry.
The announcement was made during the signing ceremony of a memorandum of understanding (MoU) on strengthening cooperation on trade promotion between the commerce ministry’s General Department of Trade Promotion and the Guangxi region’s Department of Commerce, hosted virtually by the ministry on February 24.
Cassava is one of Cambodia’s leading agro-industrial crops and an important export product of the Kingdom, making up an estimated three-to-four per cent of the gross domestic product (GDP) per year, according to commerce minister Pan Sorasak.
In 2020, the Kingdom formally launched the National Policy on Cassava 2020-2025 in a bid to increase production and make the crop commercially viable for export to international markets.
At the signing ceremony, Sorasak expressed pleasure at the timing of China’s cassava purchase, saying that it demonstrates the country’s confidence in the product, even as the Cambodian government was still exploring the crop’s potential for international export, according to a February 24 statement from the ministry.
He also asked the Guangxi representatives to consider the possibility of encouraging Chinese companies to prepare further MoUs for the import of other Cambodian products such as milled rice, corn, mangoes and bananas to the region – as well as throughout mainland China.
“Bilateral trade cooperation between Cambodia and China has been continuously strengthened and expanded due to the visionary and cooperative leadership of the two countries’ top leaders,” he said.
The signing of various agreements in the last decade, including the Regional Comprehensive Economic Partnership (RCEP), the ASEAN-China Free Trade Agreement, and the bilateral Cambodia-China Free Trade Agreement have all “paved the way for a strategic partnership” and boosted cooperation, economic and trade operations between the two countries, he added.
Guangxi Zhuang Autonomous Region governor Lan Tianli said he “warmly welcomed and fully supported” the promotion of trade cooperation between Cambodia and the Chinese region, according to the statement.
He said China was “ready” to import “quality products” from ASEAN countries, and that the regional government was prepared to invest up to $150 billion in the purchase of agricultural products.
“The signing of an MoU and a contract for the sale and purchase of dried cassava is a practical step in implementing the guidance from China’s top leaders,” said Lan.
In 2021, bilateral trade volume between Cambodia and China reached $11.19 billion – a 38 per cent surge from 2020 figures, according to the commerce ministry.
Hong Vanak, director of International Economics at the Royal Academy of Cambodia, told The Post that the Chinese purchase agreement would be an important launch point for the Kingdom’s exports, given that China’s is the world’s largest market.
Such a move demonstrates trust in local growers as well as encourages investment in related facilities such as processing and drying plants within the Kingdom, he said.
“Cassava is a product with high potential for export because it can be used in many ways, especially food production. This [the Chinese agreement] is a major development for Cambodian cassava products, as, in the past, our exports have been mainly to Thailand and Vietnam only,” Vanak said.
He added that the agreement will also increase interest in cassava cultivation amongst potential farmers and growers, and potentially enable them to fetch higher prices for their crops if they find ways to subsequently establish a “joint system or community”.
The opening up of foreign markets will also encourage increased cultivation and investment in this sector, added Battambang provincial Department of Commerce director Kim Hout. He said that the price and quantity of cassava yields in the province has been better in the beginning of 2022 compared to the same time last year.
“Coordination by the Ministry of Commerce, which will enable the export of 400,000 tonnes of dried cassava to China, will help make farmers more hopeful about growing [these] crops,” he said.
On February 27, the average price for fresh cassava from Battambang province was around 310 riel ($0.08) per kilogramme, and dried cassava 830 riel – higher than the same period in 2021, according to Hout. At present, nearly all cassava cultivated in Battambang is exported to Thailand.
Data from the Ministry of Agriculture, Forestry and Fisheries show that Cambodia exported a total of 2,793,729 tonnes of cassava last year.
Broken down by category, 1,644,591 tonnes was in cassava chips, up 8.45 per cent from 2020; 1,104,220 tonnes was in fresh cassava, increasing by 52.6 per cent year-on-year; 35,863 tonnes was in tapioca starch, climbing by 2.66 per cent year-on-year, and 9,055 tonnes was in cassava pulp and other waste products – down by 33 per cent year-on-year.