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CP Cambodia aims for growth in 2008

Charoen Pokphand Cambodia plans to expand both feed and animal production in anticipation of greater economic growth in the country. “Now is the right time to grow,” according to Sakol Cheewakoset. By Apisit Buranakanonda

Cambodia feedmill in Kendal province, 25 km from Phnom Penh.

Cambodia has faced numerous obstacles in feed and animal production in the last few years. Tight supplies of raw materials have driven feed prices up more than 20% compared with last year and bird flu in 2004 swept away many small hatcheries supplying broiler and day-old layer chicks. To be able to have a successful feed market and to re-establish trust and credibility it is important that we as CP Cambodia expand and help to modernise the local livestock industry, says Sakol Cheewakoset, senior vice-president in charge of overseeing the Cambodia and Laos operations of Charoen Pokphand (CP).
The company's production accounts for 60% of the feed sold in Cambodia. Feed is distributed via more than 40 distributors in the major animal production areas Kandal, Kampong Spue, Kampong Cham, Siem Reap and Battambang. Although labour is relatively cheap, Cambodia has up to 15% higher production costs due to more costly transportation and import taxes. Electricity alone is 20 to 30% more expensive than in Thailand. In recent years, infrastructure has been improving though.
Feed quality
Raw materials such as corn, soybean, cassava and fish meal are available locally. December is the busiest time for procuring raw materials and checking the quality of feedstuffs. Coarse grains are tested for adulterants, contaminants, appearance, physical quality, moisture content and more. Some 30% of raw materials are subject to primary testing before acceptance. Once accepted, the quality control team takes 100% samples of all intake materials. For protein sources, it is using dried freshwater fish from Tonle Sap lake, fishmeal from Kampong Som and oil from the fish processing industry.
It uses a urea-phenol red solution to screen if soybean meal has been overcooked. Raw materials and cooked products are physically separated. Producers can choose concentrate, mash or pellet feed. Pellets are slightly more expensive than mash and the market is shifting more towards pelleted feed due to better growth performance.

Ongoing silo construction to be completed in March 2008.

Cultivation areas for corn and cassava are growing in Cambodia, which will one day lead to enough production for domestic use and limited exports. However, local producers still face fierce competition from imports from Thailand and Vietnam. Vietnamese products lately have been enjoying cost advantages over their Thai competitors because the Thai baht has risen faster against the US dollar than the Vietnamese dong. Also, Vietnamese feed is packed in 25 kg bags, making it seem cheaper at first glance than the standard 30 kg bags coming from Thailand.

On the production front, the feed industry sees competition from the cassava processing industry in Cambodia and traders from Korea, Thailand and China, all of whom are vying for corn and cassava. This has driven prices up more than 50% compared with early 2007, resulting in a big windfall for Cambodian farmers. It is estimated that some 60% of raw materials produced are destined for Thailand.

Sakol Cheekwakoset of Charoen Pokhand Cambodia.
CP Cambodia's sales strategy is based on the premise that providing top breeds, proven technology and management, and good feed performance will improve the competitive position of the producers who buy its products. With modern technology, genetics and top quality feed, a producer can reduce finishing time for their pigs by two weeks or more, Cheewakoset said. The poultry breeding operation of CP Cambodia is doing well and will be expanded further in 2008 to accommodate heavy demand. The company plans to raise its annual output of broiler chicks to three million birds this year, up from 2.2 million in 2007. It will also increase production of up to 120,000 finishing piglets in 2008. Quality assurance and feed quality is on par with CP's feed in Thailand.
Formulas are prepared on site under the direction of the parent
company in Thailand. Its phase feeding program consists of pre-starter, starter, grower and finisher feed. Retained samples are kept for one month to aid trace back. CP Feed is marketed under the Hi-Gro, CP, and Hog brands. The company is also looking at developing markets for aqua feed. The coming year, CP Cambodia wants to increase its feed production from 10,000 to 15,000 tonnes/month, of which 70% will be complete feed and 30% concentrate. In addition, the company will explore potential locations for a new feed mill, either near Suang on the Vietnamese border or near the major corn growing area in Kampong Cham. The last major goal for the company is to pursue the “Kitchen of the World” strategy by investing in a further cooked plant capable of producing over 500 kg/day of sausages and meatballs in Phnom Penh.
Source: Feed Tech Volume 12 No.03

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