Rice grain prices in Cambodia are dropping. The farmer’s selling price was about 250 USD/ton (25,000 yen), but it fell to about 190 USD (19,000 yen)/ton, and the rice farmers are facing difficulties.
（The article is in English）
https://www.cambodiadaily.com/archives/farmers-block-road-amid-rice-price-crisis-118145/air

So why is the price dropping so rapidly? That is because the rice millers cannot buy rice. I mean “they can’t afford to buy rice”, this is today’s important topic.

In the first place, Cambodia is not a “country where people in poverty are in hunger” against what might be the majority of image that Japanese have toward Cambodia, no matter how poor people are, they still can afford to eat. Especially with rice, even the extremely poor people in world standards who live on less than 2 USD a day can afford to eat rice and give leftovers to chickens or dogs. Exporting the excess rice to earn foreign currency is one of the major projects that kept the nation growing, so when you hear Japanese volunteering organizations or school students donating rice to Cambodia, it doesn’t really make any sense and I would call it harassment, but I am going to keep that topic aside.

In Cambodia, there is a fragrant rice called Rumduol that has won gold medals for three consecutive years at the World Rice Conference, although they have strong rivals such as Thailand and Vietnam in the neighborhood, with the preferential tariffs for developing countries, they have had plenty of orders from EU. Although the yearly export amount is only half of what the government has aimed for (one million tons per year), they are not in a position of facing difficulties in the international market. But why is there such a phenomenon? Why is the rice grain price dropping rapidly?

It is only recently that decent quality rice polishing plants were introduced to Cambodia. To build a rice milling plant compatible with international standards, it was necessary to invest millions of dollars before we were ready to export rice. In addition, we need a decent stock plant to store the rice grain that was collected from the farmers and that costs near one billion yen. So, the government got funding through IFC (International Finance Corporation) and World Bank, several aids from foreign countries, and various other methods, decided to loan the facilities to local influential people. Everything should have worked out with this plan.

However, a lot of the cash (other than what was used to construct the facilities) that many of the rice millers gained vanished into thin air, spent on expensive cars and watches or property investment and luxurious parties, that money was supposed to be spent on buying rice grain from the farmers. And as a result, the stock plant stays empty and the fully equipped rice milling facilities are running at such a slow rate that it is not sustainable, probably resulting in a default for many.

I constantly insist that financing is the key to raise the income of farmers in developing countries to a manageable level. Money is a lubricant for every economic activity. However, it is also true that giving cash can sometimes result in tragedy, so we must create a system of financing without giving them cash. This is one of the issues that AGRIBUDDY is trying to overcome.