Rubber Gives New Bounce to Economy

Blocks of rubber latex on display at national workshop by the Ministry of Agriculture, April 12, 2012.

12th April, 2012
Radio Free Asia

Cambodia plans to expand rubber production to beef up its agricultural sector.

Cambodia’s Prime Minister Hun Sen announced plans Thursday to encourage rubber smallholdings in a bid to expand production as the country promotes the cash crop as the number two commodity after rice.

Hun Sen said the government will support not only large-scale rubber plantations but also smaller producers.

“We must continue to promote smallholding rubber plantations and promote rubber plantation on economic land concessions,” he said.

Cambodian Rubber Department Director Ly Phalla told RFA that family-based rubber plantations have increased in Koh Kong, Sihanoukville, and Kampot provinces in the country’s s southwest.

According to government targets, Cambodia plans to increase the area of land used for rubber plantations to 400,000 hectares (1 million acres) and to export 300,000 tons of rubber latex by 2020.

Cambodia, whose leading cash crop is rice, currently has about 300,000 hectares (750,000 acres) of rubber plantations, but most of the trees have been planted in recent years will not be ready in the immediate period. Rubber trees take about five to six years before they can produce white, milk-like rubber latex.

Last year Cambodia exported about 46,500 tons of rubber, double the year before. The exports generated about U.S. $200 million dollars and made Cambodia the world’s ninth-biggest producer.

All of its rubber is for export and most is sold to Vietnam, Malaysia, China, and Singapore, where it is used in manufacturing

Cambodia has welcomed foreign investment, especially from Vietnam and China, giving companies 99-year land concessions to establish rubber plantations.

Of the land used for rubber plantations last year, over two thirds were land concessions to companies, while the remaining were small-scale family and private plantations.

At least 77 companies are investing in the crop in the country, covering 17 percent more land than the year before.

‘Just like gold’

At the same time as increasing production, Cambodia is moving to increase the quality rubber produced. Most of the rubber produced currently are low grade..

“We must ensure the quality of cultivation and of the variety because inferior varieties return low yields and result in revenue losses,” Hun Sen said.

He warned that failure to upgrade rubber quality could boomerang on the expansion plans, resulting in losses valued at about U.S. $600 million annually from 2020.

Agriculture Minister Chan Sarun said that the government is working on improving rubber grades to make them acceptable in international markets.

“We must guarantee our quality, including planting, selecting seeds because bad seeds will [dampen yield],” he said.

He forecast a great future for Cambodia’s rubber industry, likening planting rubber to “making gold.”

Cambodia’s biggest cash crop will remain rice, its primary agricultural export, he said.

Environmentalists in Cambodia have campaigned against rubber plantations in protected forest areas.

In the Prey Lang forests in the northeastern part of the country, activists have combated illegal logging and other abuses which they say stem from government concessions for opening up the land to rubber plantations.

The Prey Lang network says more than 40,000 hectares (98,840 acres) in the forest have been granted for rubber plantations alone.

Reported by Sok Serey for RFA’s Khmer service. Translated by Samean Yun. Written in English by Rachel Vandenbrink.