Rice Market in Southeast Asia Area

Among agricultural products, rice is absolutely indispensable to daily life. It contributes a lot to food security and rural economy in Southeast Asia. What an important role has rice played in the Southeast Asia area? This article will give you a brief description of the rice market (rice export and import, rice milling technology, government’s policy, challenges, and opportunists) in Laos, Cambodia, and Vietnam.

Significance of Rice in Southeast Asia Area

Rice has long been the most important food crop cultivated in the Southeast Asia area.

Laos

Laos is an agriculture-led economy country, rice has played a decisive role in agricultural development, contributing 51 percent of the GDP. Approximately 1,880,000 individuals are involved in agricultural work. About 93 percent of the area devoted to rice production is for the production of sticky rice, a subsistence crop used primarily for home consumption. Therefore, as early as in 1999, Laos has reached the rice self-sufficiency. However, unlike its neighbors, Thailand, and Myanmar, Laos does not export their rice but rather meets the domestic consumption.

Cambodia

Like Laos, Cambodia’s rice plays an important role in its economic development. Cambodia is well known for its agriculture economy, rice is cultivated primarily through traditional farming practices by over 80 percent of Cambodian farmers. It is the staple food for Cambodians and their most important field crop. Cambodia has a unique rice production conditions, it lies in the Mekong Peninsula of Southeast Asia, with a total landmass of 178,520 km2, of which about 22% is arable. Much of the country is taken up by a central plain, in the middle of which is the huge freshwater lake Tonle Sap. This plain is the country’s grain basket; it is bounded by mountain ranges in the southwest and northeast. So, Cambodia’s rice is exported to all over the world and became the fifth rice exporter in the world, the following are the exportation of rice in Cambodia in 2014.

Rice Export in Cambodia

Cambodia exported 200,000 tons of rice to 48 countries in 2015. The goal is to reach 250,000 tons this year. So far this year, it has exported around 78,000 tons of milled rice, an increase of 4,000 tons from the same time last year,” said Hean Vanhan, director of the government’s One-Stop Service for Rice Export.

Vietnam

When talking about rice, one country has to be mentioned, that is, Vietnam. Rice is indispensable agricultural products to the daily life of 89 million Vietnamese. It plays the most important role in Vietnam’s rural economy, creating jobs for 60 percent of the country’s workforce and a source of export earnings. Unique natural conditions and geographical location provides superior environmental support for the production of rice in Vietnam.

Vietnamese rice almost comes from the Mekong Delta, it is the most important rice production area in Vietnam, contributing 50% of the country’s rice production and accounting for 53% and 79% of national production, respectively. Also, the country’s major rice export sector is also concentrated here, with 90 percent of total cereal exports coming from the region. Vietnam is the world’s third-largest rice exporter after India and Thailand, with an estimated export of 1.6 billion tonnes of rice in 2016, accounting for 7.5 percent of world total rice exportation.

Modern Rice Milling Technology Contributing to the Development of Rice Business

In addition to benefiting from its excellent geographical location and climatic conditions, advanced rice technology has also played a significant role in the Southeast Asia rice business.

The rapid economic development makes the increasing requirements for high-quality rice, people are more likely to eat finished rice, for the processed rice is not only good in taste but also good for fineness. Rice milled by rice milling machines are more favored in the market by customers.

Modern rice milling systems adopted in the last few years have helped elevate rice to the international market. In Laos, some private rice sector and public rice sectors cooperating with smallholder rice farmers aim to improve rice production. As one of the world’s leading rice exporters, Vietnam possesses the modern rice milling processing technology. Vietnam’s rice exports have been growing year by year so that needs more advance and high-performance rice milling equipment. In Vietnam, a number of modern rice milling factories, including a larger set of milling plant and portable small rice milling machines, aiming to produce high-quality rice as well as meeting the increasing demand for high-quality rice for worldwide customers.

The Key Role of the Government in Rice Industry

The government has taken some effective measures to improve the production of rice. In Cambodia, in order to sustain the growth of rice production, the government has devised and implemented a program that uses the sustainable rice cluster (SRC) method. SRC has increased rice cultivation by some 40% over conventional methods.

In Vietnam, the government also undertook agricultural reforms in its major rice-producing areas, to address the challenges posed by climate change and to halt the flow of water in the Mekong Delta. It aims to produce higher quality climate-adapted rice, and boost alternative crops to ensure sustainability in the Mekong Delta, home to 18 million of Vietnam’s 94 million people.

Challenges and Opportunities Coexisting Challenges in rice farming areas.

Challenges in rice farming areas

1. Limited arable land suitable for rice cultivation As the country’s population continues to rise, more commercial land is needed for habitation, resulting in a significant reduction in agricultural arable land, at the meantime, grain output decline due to the irrational use of cultivated land by farmers and lead to nutrients lose from the soil.
2. Lack of good & effective agricultural crop extension programs, primarily due to a lack of funding This has resulted in a severe lack of educated and experienced extension officers, as well as insufficiency of modern technology for post-harvesting and farming systems training and assistance.
3. The lack of a farm credit system affects not only rice farmers but the rice milling industry, resulting in low use of fertilizer and uptake of farm mechanization, at both the production stage (planters, harvesters) and processing stage (mills, grain dryers, storage facilities). Poor transportation and related infrastructure such as roads, railways, and milling and handling equipment for the rice sector.

Opportunities for rice production area

Notwithstanding these production challenges, there are great opportunities to overcome them, for instance, increased development and deployment of high-yielding varieties can offset the decline in rice area due to urbanization; improved crop management technologies can possibly avert soil degradation.