Saigon Trading Group signs deal for red corn

Photo by: Heng Chivoan
A farmer in Kampot province this week holds kernels of red corn.

The Phnom Penh Post
Wednesday, 12 August 2009
Chun Sophal

Farmers in Battambang and Kampong Cham provinces will have a new market for little-produced crop with $1-million export agreement to deliver 5,000 tonnes

Tauch Tepich Import Export company said Tuesday that it had inked its first agreement with Saigon Trading Group (SATRA) to supply 5,000 tonnes of red corn, worth US$1million, to the Vietnam-based company this year.

Tauch Tepich, director of the import-export company, said he hoped the deal would open more doors.

"We hope that the export of red corn to Vietnam will provide opportunities for Cambodian farmers to win wider markets for their agricultural products," he said.

According to the agreement signed last week, Tauch Tepich will begin supplying red corn to SATRA, at $200 per tonne, this month and continue through the rest of the year.

Tauch Tepich said Tuesday that the company will transport its first installment of 700 tonnes through two international border crossings in Trapaing Thlong and Phnom Da, both in Kampong Cham province.

Future exports are to be trucked to Vietnam each week until the balance of the agreement is reached, Tauch Tepich said, adding that if the process goes smoothly, his company could see continued cooperation with SATRA.

Tauch Tepich said Cambodia is well-suited to produce red corn, and that his company is capable of delivering an additional 5,000 tonnes next year if additional agreements are struck.

He added, however, that many farmers choose not to produce red corn because of a lack of appropriate markets and export options.

Tauch Tepich said his company had purchased the red corn from Cambodian farmers in several districts of Battambang and Kampong Cham provinces, with cooperation from the Baitong community, led by Phu Puy, president of the Battambang Chamber of Commerce.

Yang Saing Koma, director of the Cambodian Centre for Study and Development in Agriculture, said Tuesday that Cambodia lacks markets for the crop every year, and that if proper agreements existed to export it, more farmers would be willing to invest in the crop.

Corn farmers generally see low profit margins because of the expense of importing quality seeds, Yang Saing Koma said, adding that private companies as well as the Ministry of Agriculture should provide more opportunities to farmers by preparing production plans and supplying seeds.

"I think that the export of red corn is a good step to assist our farmers in meeting market needs," Yang Saing Koma said.

The export agreement with SATRA follows an announcement by the Ministry of Agriculture in June that South Korean company KOGID Cambodia will invest $150 million to grow and process corn for animal feed to be sold overseas.

Cambodian farmers planted about 141,264 hectares of red corn, with a total production output of 561,584 tonnes, in 2008, according to figures from the Ministry of Agriculture.

Ministry figures also showed that total corn production last year was 611,865 tonnes from 163,106 hectares of land, principally in Battambang, Pailin, Kampong Cham and Kandal provinces.