Key View
- In line with USDA projections, we forecast that Cambodia’s domestic rice production surplus will climb to a record 2.84mn tonnes in the MY2024/25 (Jan-Dec) season. Output is expected to increase to an all-time high of 7.40mn tonnes while consumption is seen rising to 4.56mn tonnes. Since MY2015/16, Cambodia has by some margin achieved the highest average rate of rice production growth in South East Asia with output rising at an average rate of 4.3% per annum up to MY2023/24.
- Nonetheless, the Cambodian rice milling sector remains inefficient in comparison to regional peers, which continues to weigh on export volumes and the realisation of potential export value added. Insufficient domestic milling capacities results in the official and unofficial export of unmilled rice to Vietnam while inadequate milling facilities result in a comparatively low milling rate, with the USDA’s estimate for Cambodia’s average milling rate 2.4% and 7.6% lower than rates achieved in Vietnam and Thailand, respectively.
- Our medium-term outlook points to the continued growth of the Cambodian rice production surplus up to MY2027/28 when we anticipate that Cambodia’s rice surplus will exceed 3.00mn tonnes. As a result, continued investment in domestic rice milling capacities – as well as associated storage infrastructures and rice drying facilities – will be required if the rice sector’s full export potential is to be achieved. Current elevated international rice prices represent an upside risk to domestic and foreign investment in the sector.
