Nagnoby Bank is considering lending about 15 billion kip to a local businessman to establish a cassava processing plant in Borikhan district, Borikhamxay province.
The plant would cut and dry cassava before distributing it to local and international suppliers.
Cassava is laid out to dry in Borikhan district.
Nagnoby Bank Director Bualong Xayavong said there is high demand for dried cassava not only in Laos, but also in China, Japan, Korea and Vietnam.
Currently most of the cassava farmers in the district supply raw cassava to the Lao Indochina Group (LIG), which produces powder for export mainly to China.
“The new plant would compete with LIG and other plants to purchase raw cassava,” Mr Bualong said at a LIG review meeting held in Borikhan district recently.
The proposed plant would provide a ready market for local cassava farmers into the future. “This would help with poverty reduction efforts,” he said.
It is believed the total area of cassava crops in the district will increase by over 50 percent in the coming years, to cover more than 1,000 hectares.
“Our bank will also release about 12 billion kip in loans to allow farmers to expand their plantations,” Mr Bualong said.
The bank has provided loans of more than 600 billion kip to promote local production, including three cassava processing plants in Vientiane and Champassak provinces and a fruit juice processing plant in Luang Prabang province.
Nagnoby Bank has lent about 17 billion kip to businesses and farmers in Borikhan district, including about 4.5 billion kip to allow farmers to expand cassava plantations to cover another 680 hectares, producing about 25 tonnes of raw cassava per hectare.
The bank also helps farmers in Khamkeuth district in Borikhamxay province, in Hom and Xaysomboun districts in Vientiane province, and in Sangthong and Pakngum districts in Vientiane to grow cassava for supply to processing plants nationwide.
The cassava processing plant in Vientiane province began production last year and has the capacity to produce about 200 tonnes of cassava powder per day. It primarily exports to Vietnam.
LIG's plant in Vientiane produces 150 tonnes of powder a day and about 80 percent of its output is shipped to China.
The Champassak plant will start production this month with a capacity of 200 tonnes of powder per day for both local and overseas supply.
Cassava is an ingredient in noodles, snack foods and seasonings. It is also used in the production of clothes, glue, paint, paper, medicine, false teeth and prosthetic limbs.
According to the Ministry of Industry and Commerce, another factory produces cassava powder in Lau-ngam district, Saravan province. It is Vietnamese-owned, and exports to Vietnam and China.
I think cassava farmers needs a cheer! I think Samakomlao should not be used only for fault finding but to say "Lao su su" to those ordinary people who are trying to make a difference, no matter how small (in your perception) their contribution is.
