American business group Akra, led by Cambodian-born former US ambassador to the United Nations, Sichan Siv, has signed an agreement with a rice mill under a new co-operative structure it says puts ownership and profits back in to the hands of Cambodian producers.

Akra’s managing director Thomas Willems said that with buyers waiting in the US and Europe, the signing of the mill puts the co-operative in motion.

“We have our first agreement signed with our first miller. We are effectively working on the shipping companies right now; we have goods coming this way, so we have started that process,” Willems said.

“Now that we have the agreement signed this is all starting to move forward.”

The ambitious project aims to create immediate efficiencies, with the introduction of new technology, and realise greater margins by enhancing production capabilities to target retail rather than world commodity prices.

Willems said Akra’s unique company structure put profits and decision-making back in the hands of Cambodian producers while maintaining the transparency and standards demanded under an American company’s legal structure.

“We are a co-op; we are working with existing mills. What we are bringing is technologies to the mills that can supply the volume that we need as well as work with the farmers to help the farmers out” Willems said.

“Our goal is to work with the millers to bring in bagging equipment so that we can actually bring it to the retail stores in America and Europe, where they are selling rice per pound, not per tonne.

“When it’s all said and done, the entities that benefit the most are the Cambodian people and the industries within this country,” he said.

Kim Savuth, president of the Federation of Cambodian Rice Exporters, said he welcomes such innovative business ideas; his concern, however, is a lack of interest from the farmers themselves.

“The closest initiative we have had in the past are farmers’ contracts, whereby farmers borrow money from millers to buy seeds in agreement to sell their rice back to the miller once farmed,” Savuth said.

“In theory, I would definitely support a co-operative initiative; in practice, I think it will be difficult to get farmers to agree as they prefer to focus on farming rather than becoming a company shareholder and engaging in the business side.

“If it does become a reality I will be the first to congratulate Akra,” he said.

To contact the reporter on this story: Daniel de Carteret at [email protected]

Hor Kimsay at [email protected]