A Change of Guard

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Wednesday, 20 January 2010

Kogid set to buy $7.35m of red corn this year

Tuesday, 19 January 2010
By Chun Sophal
Phnom Penh Post

SOUTH Korean company Kogid Cambodia Co Ltd expects to buy about 7.35 million of red corn from Cambodia this year, the firm’s manager said Monday.

Manager of the organisation, Oung Savuth, told the Post Monday he wants to buy 70,000 tonnes of the crop during 2010.

According to government estimates, this accounts for around 10 percent of Cambodia’s expected annual red corn yield.

Around $3.15 million will buy 30,000 tonnes of grain in the rainy season, which starts in May. The remaining $4.2 million will be used to buy dry-season corn, said Oung Savuth.

He added that the company bought red corn from farmers for US$105 per tonne last year. The price offered to growers in the competitive corn market for this year has yet to be determined.

“We have only just got our money ready and set the amount to buy,” he said.

In June, Kogid invested $150 million in farms in Battambang, Pailin, Kampong Cham and Kandal provinces to grow and buy between 70,000 and 150,000 tonnes of red corn to process into animal food.

The company is in the first phase of its business plan up to 2012, a period in which it plans to invest $38 million in the venture.

Kith Seng, undersecretary of state of the Ministry of Agriculture, Forestry and Fisheries, said Monday that Cambodia is able to harvest about 700,000 tonnes of red corn per year.

He added that companies offering to pay a higher prices will succeed in buying more of the grain.

“I believe that this company will manage to buy enough corn, as it plans, if it is prepared to offer a competitive or higher price compared to other companies,” he said.

Cheam Chansophorn, director of Battambang province’s Department of Agriculture, said farmers might grow more corn this year because the crop is starting to penetrate new overseas markets while gaining a better price. Historically, farmers have sold across the border in Vietnam and Thailand.

“Many companies are getting ready to compete to buy corn in the coming harvest season,” he added.

Baitang Kampuchea Plc reported Monday that last year it bought 4,000 tonnes of red corn from farmers to be sold to Vietnam-based companies.

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