Cambodia's Rubber Industry Sees Largest Growth in Region

Cambodia's natural rubber production, which has remained stagnant through most of the latter half of this decade, is expected to grow more than 43 percent this year compared to 2009, according to a regional rubber growing association. Natural rubber production in Cambodia is projected to reach 49,500 tons, marking a 43.5 percent increase over the 34,400 tons produced in 2009, according to the September monthly bulletin of the Association of Natural Rubber Producing Countries. Between 2005 and 2008, Cambodia produced about 20,000 tons of natural rubber annually, according to statistics from the ANRPC.

At 43.5 percent, Cambodia notched the highest year-on-year percentage increase in the 11-member ANRPC, which comprises Thailand, Indonesia, Malaysia, India, Vietnam, China, Srey Lanka, the Philippines, Singapore, Papua New Guinea and Cambodia, which joined the association last year.
The ANRPC's September report attributed Cambodia's increase in production to expansion of mature rubber orchards by 10,000 hectares this year. Mak Kimhong, director of Cambodia's Rubber Association, said the rising value of rubber, driven largely by the de¬mand for tires in developing countries, encouraged growth in the industry.

"Cambodia's rubber production is increasing year to year because we have planted a lot of rubber and because now the rubber price is higher," he said. "It now costs $3,600 per ton, and we never got such a price last year when the price of rubber was nearly $1,000." Although Cambodia's year-on-year percentage increase is the largest among ANRPC members, the country's projected output of nearly 50,000 tons is the second lowest, behind marginal producer Papua New Guinea. Neighboring Thailand leads the group with a projected production of 3.27 million tons of natural rubber in 2010, while Indonesia is second with an estimated 2.6 mil¬lion tons. Vietnam is fifth with an estimated 770,000 tons. Every member country is expected to increase year-on-year production. Cambodia's relatively small market contributed to the 43.5 percent increase. Chan Sarun, minister of agriculture, forestry and fisheries, called Cambodia's natural rubber industry a "growing market." About 150,000 hectares of rubber is now being farmed in Cambodia, he said. "In the future, maybe 2015, we will have maybe 250,000 hectares," he said.
 
He added, "I think in the future, we will have power in the rubber industry." Mr Sarun couldn't say how much Cambodia's rubber industry is worth or how much another 100,000 hectares of rubber trees would affect overall production. He attributed much of the growth in production to government land concessions. In September 2009, Mr Sarun signed a memorandum of understanding with his Vietnamese counterpart, allowing numerous Vietnamese companies to plant 100,000 hectares of rubber by 2012. More than 10,000 hectares have already been planted. The companies are planting in Kompong Thorn, Kratie, Mon-dolkiri, Ratanakkiri, Stung Treng and Preah Vihear provinces. Cambodian businessman and CPP Senator Mong Reththy, chief executive of the Mong Reththy Group, has also waded into the rubber industry. Mr Reththy said in May that he planted a 750-hectare rubber planta¬tion in Preah Sihanouk province's Stung Hav district along the coast He said he plans to invest up to $15 million to grow his plantation to 5,000 hectares.

Mr Reththy said 43.5 percent year-on-year growth is a positive sign for the country's rubber industry.
'This is encouraging because we try to increase both the num¬ber of companies and [iarmers],"
 
he said yesterday. "It is an estimate that encourages us." Mr Reththy said in May that he received 3,000 hectares in rubber plantation concessions from the government, while acquiring 2,000 more hectares in the area from local villagers. Although land concessions may have helped fuel growth in the rubber industry, they've also sparked land disputes across the country. In May, about 200 families from an ethnic Kreung com¬munity in Ratanakkiri alleged that a Vietnamese rubber company, Hong Anh, illegally grabbed 400 hectares from them. In December 2009, about 100 Svay Rieng farmers protested their loss of land during a rally in PhnomPenh. Mathieu Pellerin, a consultant with rights group Licadho, de¬nounced the government's use of land concessions, saying they lead to a "tremendous amount of human rights abuse." "Land concessions are a big problem," he said. "There are other ways to develop the agricul¬ture industry and the rubber industry." Mr Pellerin proposed allowing for more smaller-scale rubber plantations, run by villagers or communes. 'Tf you give them access to the markets, you would see more Cambodians benefit," he said, adding, "There are very few bene¬fits to land concessions, if any."
 
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