The Cambodia Pepper and Spices Federation was jointly established by the Ministry of Commerce and the Ministry of Agriculture, Forestry and Fisheries last month.
Global pepper production by country – 2017
Cambodian farmers growing pepper without geographical indication (GI) continue to face difficulties due to low prices while next year’s yield is expected to decline, said Yin Sopha managing director. pepper agricultural development cooperation Dar-Memot said.
According to Mr. Sopha, this year the market price of pepper without GIs in the market is still below the cost of production, so the industry is not expected to expand next year.
Since the beginning of the harvest season, pepper prices have been at $2.6/kg, well below the profitable level. The lower prices are due to the general state of the global market.
The price of pepper cannot be increased any further, as the global supply of pepper is already more than the demand – the price is unprofitable for farmers and the cultivated area will not increase any more.
Mr. Sopha believes that this sector will no longer be a viable investment option if prices continue to fall.
Formation of a federation
According to a report from the Ministry of Agriculture, Forestry and Fisheries, as of 2016, the Kingdom of Cambodia has 5,000 hectares of pepper cultivation, the country’s pepper exports have increased from 1,050 tons in 2016 to 2,698 tons last year.
The government has set up a new federation for the Kingdom’s pepper industry to strengthen the market and address challenges in the industry, as the current crop faces falling prices.
The Cambodia Pepper and Spice Federation was jointly established by the Ministry of Commerce and the Ministry of Agriculture, Forestry and Fisheries last month.
The federation will promote the value of pepper and find new markets, especially not to let pepper farmers without GIs depend on informal exports to Thailand and Vietnam.
Mr. Song Saran, CEO of Cambodia’s AMRU Rice Co Ltd, which was elected president of the federation, said he was seeking technical assistance to resolve key issues before the federation became operational.
We do not have any update on pepper prices. In the immediate future, we have to find technical support for the federation. We will address the main issues that occur now and take further action from there.
Vorn Savourn, a pepper farmer in Memot district of Tbong Khmum province, who owns a 5-hectare farm growing pepper, said he still sells pepper to traders.
I do not expect pepper prices to increase. Most of the pepper farmers here are considering selling their farm because they cannot repay the loan, he added, growing pepper is no longer a good option for farmers because there is no sustainable market.
- It is known that GI pepper currently only has Kampot pepper and Quang Tri Cua pepper
Read more: >> Cambodia: Negative outlook for pepper
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