An Overview of the Brick and Tile Manufacturing Industry in North West Cambodia

by

Bas Rozemuller

March 1999

Phnom Penh, Kingdom of Cambodia

Center for Advanced Study UNDP/CARERE

Author's Acknowledgements

A research project like this and the subsequent research reports are always team efforts. As far as the research in the provinces is concerned, I want to thank my colleagues Mr. Kim Sedara, Ms. Nguon Sokunthea, Ms. Kin Tepmoly, Ms. Chan Kanha, Mr. Khun Sovithea, Mr. Ouk Chanthou, Mr. Chhaing Sophal and Mr. Khat Sokha. I am also grateful to CARERE and its staff for facilitating and supporting this research project. Finally I want to thank the Brick and Roofing Tile Manufacturing Associations and the individual members for their help and hospitality during the research.

The completion of the six resulting case study reports and this occasional paper is also the result of the support of and the cooperation between a number of people, mainly within the Center for Advanced Study. I want to thank Mr. Ouk Chanthou, Mr. Chhaing Sophal and Mr. Khat Sokha for writing the individual case study reports. Especially I want to thank Mr. Khun Sovithea, who - besides writing a case study report - also did work on the final lay-out of these case study reports. In this respect I am also grateful to Mr. E Neng, Ms. Van Sovathana and Ms. Khim Kunthy for typing, editing and finalizing the case study reports. I know there was a lot of work involved.

Regarding this occasional paper I want to thank my colleague and project director Dr. William Collins for his constructive criticism and helpful support in finalizing the paper. I am also grateful to Mr. Tony Knowles, the Manager of the Private Sector Development unit of CARERE, for his useful comments regarding earlier versions of this paper. Finally I want to thank Mr. Keo Lot for translating this occasional paper into Khmer with great care.

Table of Contents

Chapter One 5

Introduction

Chapter Two 7

Brick Manufacturing in North West Cambodia

2.1 The brick and Tile Industry 7

2.2 Classification of Brick Enterprises 9

Chapter Three 15

Brick and Tile Manufacturing

3.1 The Products 15

3.2 The Production Process 16

Chapter Four 25

Brick Enterprises in North West Cambodia: the Case Studies

4.1 Introduction 25

4.2 General Features of the Factories Researched 25

4.3 Business Economic Aspects of the Enterprises Analyzed 28

Chapter Five 31

Conclusions and Recommendations

5.1 Some Concluding Remarks 31

5.2 Some Recommendations 33

Glossary 37

References 39

Map of Cambodia 41

Appendix 1: Brick Factories in Cambodia 43

Appendix 2: Income Statement of a Brick Plant 47

Appendix 3: Technical Data of a Brick Plant 49

Chapter One

Introduction

The beginning of this decade witnessed a shift in Cambodia from a centrally planned to a market economy. This resulted in an enormous increase in entrepreneurial activities, as described in our previous study on the rice milling industry in North West Cambodia.[1] A similar development can be seen in the brick and tile producing industry, subject of this CAS Occasional Paper. One of our informants told us that when he set up his brickyard in Banteay Meanchey Province in 1990 there were only one or two other businesses engaged in the production of bricks in that area. Currently, in 1999, there are about 15 brick and tile factories in Banteay Meanchey Province. In Battambang Province a similar growth in brick related enterprises took place.

In this rapidly changing business-economic climate the Private Sector Development (PSD) unit of CARERE (Cambodia Area Rehabilitation and Regeneration Project) has supported the formation of private business associations in North West Cambodia. In 1997 the PSD Unit facilitated the establishment of two Battambang and one Banteay Meanchey Rice Millers Associations. Before long, another industrial sector in the North West, the brick and tile industry, saw similar developments: two associations of brick and tile manufacturers, one in Battambang and one in Banteay Meanchey Province, were formed.[2]

The PSD Unit commissioned the Center for Advanced Study (CAS) to conduct micro economic research at brick and tile plants operated by members of the newly formed Associations, in order to get a better understanding of the competitive state of these enterprises. CAS was well positioned to undertake this task as their small business research team just had completed a similar series of case studies of the rice mills belonging to the Rice Millers Associations in both Battambang and Banteay Meanchey Province.[3] The Executive Committees of the two Brick and Tile Manufacturers Associations identified and selected six brick factories at which CAS conducted detailed case studies.

This overview is meant to accompany the six resulting case studies. These case studies have been presented to the Associations and the management of the enterprises examined, discussing the different business-economic profiles of the plants studied. Because of the confidential character of the six case studies, this occasional paper - which is intended for general circulation independent of the case studies - does not present the detailed data included in the case studies. Chapter two describes the history of the brick industry in the North West of Cambodia and presents a picture of the differentiation of the various brickyards of the industry. The third chapter details the manufacturing process. Chapter four discusses the six case studies. The fifth chapter concludes with remarks regarding the Associations and their future role in the construction industry.

Chapter Two

Brick Manufacturing in North West Cambodia

2.1 The Brick and Tile Industry

Although 85 percent of Cambodia's population lives in rural areas, the working population is not exclusively engaged in agricultural activities. There is an important non-agricultural or non-farm sector that is likely to grow and make a significant contribution to rural incomes. This sector includes a wide variety of economic activities in trade, transport, services and manufacturing. The latter sub-sector, rural based small scale manufacturing has been recognized as an area of great promise in private sector development in Northwest Cambodia where otherwise development efforts have largely focused on the agricultural sector. The recent establishment of private business Associations in both the rice milling and brick manufacturing sectors confirm this.

A recently built boat kiln along the road from Battambang to Pursat

The brick and tile manufacturing industry is very young in its present market-oriented form. After independence in 1953 until 1975 there were only a few brick plants in Cambodia. One of our interviewees told us there were only five factories in Battambang province, mainly owned by rich Chinese. During the Khmer Rouge regime only a handful factories were allowed to operate. One of these was a factory in Mongkol Borey District, now in Banteay Meanchey Province. The owner explained:

"At that time they warned us many times. They said: 'If you can not make a good brick or if there are too many broken bricks, you will be killed!'"

In the eighties the PRK regime (People's Republic of Kampuchea) rebuilt the destroyed pre Khmer Rouge brickyards and started to manage them as state factories. They even expanded some plants, resulting in factories with 8 to 12 kilns. During this period there was one large brick plant in Battambang Province, which supplied the whole province, which at that time still included the area that is now Banteay Meanchey Province. Banteay Meanchey became a separate province in 1989. The early nineties saw a resurgence of entrepreneurial activities in the brick and tile industry resulting from the national economic growth and the related expansion of the construction industry.

Today there are between 500 and 600 brickyards in Cambodia. In 1997 the Ministry of Industry, Mining and Energy carried out a survey on the number and type of brick factories in Cambodia.[4] The figure below shows the most important provinces in Cambodia regarding brick manufacturing and the two provinces in which the brickyards subject to this research are located, Battambang and Banteay Meanchey Province.[5]

No	Province/City	No. of Plants	No. of Factories per Production Capacity (10,000 pieces/year)
			<20	20-50	50-100	100-200	200-300	300-500	>500
1	Kompong Cham	81	39	38	4
2	Kandal	76	13	53	7				3
3	Phnom Penh	73	3	41	13	10	2		4
4	Kompong Thom	48		33	13	2
5	Battambang	26	13	13
6	Banteay Meanchey	13	11		2
	Total	317	79	178	39	12	2		7

Figure 1: Brick Factories in six Cambodian Provinces [6]

The first four provinces in this figure, Kompong Cham, Kandal, Phnom Penh and Kompong Thom, comprise 62 % of the total number of brickyards in the Kingdom of Cambodia. Battambang and Banteay Meanchey Provinces combined have only 29 brick plants or about nine percent of the total number of brickyards. However, we should also take into account that the population of Battambang and Banteay Meanchey Province together is only 12 % of Cambodia's total population (a predominantly rural population with, in general, a low demand for bricks). The other four provinces serve the brick demand of the more urban parts of the country. These latter four provinces account for about 37 % of the total Cambodian population.[7]

At the time of our research - November 1998 until February 1999 - there were, according to those surveyed, approximately 30 brickyards in Battambang Province and 15 in Banteay Meanchey Province, a slight increase from the Ministry's estimate of 1997.[8] Of the 30 brick factories in Battambang Province 24 are members of the newly formed Associations. The Banteay Meanchey Brick Manufacturers' Association has 12 members. Members of both Associations expect that most brick manufacturing enterprises will eventually join, once the Associations show their merit.[9]

2.2 Classification of Brick Enterprises

There are several ways to categorize businesses in general and the same is true for brick enterprises. One way to do this, is to look at the output of a factory. Figure 1 above - based on the Ministry of Industry, Mining and Energy production statistics - is an example of this. Another way to classify businesses is to look at the number of employees, its total capital and whether or not the enterprise is licensed, as is shown in Appendix 1. [10]

A loh moul or round kiln being heated by rice husk

It is also possible to group factories by the number of extruders, i.e. the machine which extrudes the bricks out of the raw clay.[11] This can be a very decisive factor: Arghiros mentions in his paper on the brick industry in central Thailand[12] that the number of extruders has an important impact on labor and productivity issues (Arghiros 1997,a). In fact, he distinguishes between mechanized and non- mechanized production methods:

"In non-mechanised brickyards bricks are moulded by hand. Machines are sometimes used to mix brick earth, but never for other stages of production. Mechanised brickyards use machines (technically called extruders) to form the bricks. (……) The operation of extruders, the output of which amounts to 15,000 bricks a day, requires a minimum of about ten workers (Arghiros 1997, a:8)."

This distinction can not be made in either Battambang or Banteay Meanchey Province since all the brick factories are mechanized, i.e. they all use extruders. This is probably due to the fact that it is a very young industry, while those in central Thailand were set up in the seventies and eighties. In Battambang and Banteay Meanchey, however, we only observed brickyards using one extruding machine. The owners said that operating one extruder was sufficient to supply the kilns with the bricks needed to fulfil market demand. In and around Phnom Penh there are brickyards which operate two or more extruders.

This report aims to take a holistic approach, as in the first study of the rice milling sector. Instead of focusing on small enterprises as a sector, we examine the position of small businesses in relation to suppliers of input, distributors of output and its larger competitors, the so-called subsector approach (Boomgard et al, 1991). In other words, this method selects a group of businesses related to specific products, in this case bricks (and to a certain extent roof tiles) as the research focus and explores its structure. However, due to time and budget restraints we were not able to examine the whole construction materials sector. Subsequent studies should focus on the larger context of the brick plants researched in this project.

The respondents in our research use three classifiers when they judge a brickyard. The first one is the distinction between a loh ut krusaa or family kiln and a loh ut krom hun or kiln enterprise. The second distinction regards the number of brick kilns a factory has (and sometimes also the combined capacity of the kilns, i.e. the number of bricks that can be stored inside the kilns). Another way to classify brick enterprises is to look at the types of kiln they use to fire the extruded bricks.

A loh ut krusaa, i.e. family kiln, is a small scale brickyard that only engages family labor in its production process. These family kilns are usually located far away from the main roads and only supply bricks at the village level. According to our informants there are only a few of this type left in Battambang and Banteay Meanchey Province. Loh ut krom hun, or kiln enterprises, on the other hand, one can see along the main roads near the provincial capitals Battambang City and Sisophon. These factories employ labor from neighboring villages.

The distinction between loh ut krusaa and loh ut krom hun is very similar to the description of three different types of Thai brickyards provided by Arghiros (Arghiros 1997,a). He distinguishes petty commodity producers, petty capitalist producers and capitalist producers, a distinction based on their relation to labor and mechanization. Petty commodity producers are typically operated by the owner, using non-waged labor. "(…) Capital accumulation occurs through the extraction of surplus value from such labour, including that of the owner-operator"(Arghiros 1997,a). These factories are non-mechanized or have a very low level of mechanization.

Petty capitalist producers, by contrast will have introduced greater mechanization into the brick and tile manufacturing process. Thus they will require a larger labor force with a more complex division of labor and wage payment based on the time worked, in addition to a core of family employees. The key to productivity in such a business is assuring the industrial discipline of the rural workforce by skillful management techniques of the entrepreneur.[13]

The foundation of a square kiln

Capitalist production and petty capitalist production are differentiated by both production relations and production scale. In a capitalist production method the labor is employed exclusively through wage payments (Arghiros 1997,a). As the scale of such factories increases and earth moving machinery, lift trucks and mechanized kilns are introduced, the adjective 'petty' is no longer appropriate.

The majority of the brickyards in the North West of Cambodia fall into the second category, that of petty capitalist producers. Most of them employ laborers but the owners themselves are also involved in the production. However, more than half of the production output is generated by paid labor, classifying it as a petty capitalist producer rather than a petty commodity producer (Cook and Binford, 1990). Except for the use of an extruder to shape the bricks, these Cambodian enterprises are hardly mechanized.

A second way to classify brickyards is by the number of kilns, according to our interviewees. At the plants we visited this number varied from two to four kilns. However, most of them had only two kilns in operation: one was usually being fired while the other was being packed or unpacked. The packing capacity, i.e. the number of bricks that can be loaded into the kilns, varies from 14,000 to 50,000 bricks.

A brickyard with three elephant kilns

The type of kiln used is another distinction that brick entrepreneurs in Battambang and Banteay Meanchey make. They differentiate four types: loh chrung or loh carre, i.e. square kiln, loh moul or round kiln, loh damrei or elephant kiln and loh tuuk, i.e. boat kiln.[14] The square kiln is the most popular one, especially the last few years. Whenever we visited a brickyard and they were building a new kiln, it was a square one. The loh carre has no roof and because of that is very easy to pack and unpack. The disadvantage is that a substantial amount of heat is lost during the firing process increasing fuel costs.

	Type of kiln	Average Size (meter)	Storage Capacity (bricks)
1	Square Kiln	7 x 6 x 4	50,000 pieces
2	Round Kiln	5 (diameter) x 6	50,000 pieces
3	Elephant Kiln	7 x 3 x 3	16,000 pieces
4	Boat Kiln	19 x 4 x 3	45,000 pieces

Figure 2: Four Types of Kiln

The loh moul is a rather high kiln that can store large numbers of bricks. It is also suitable for manufacturing roof tiles. This type of kiln is often seen at the family operated enterprises. The disadvantage of their size is that it takes a long time to pack and unpack. The loh damrei, i.e. elephant kiln is so-named because the shape of the kiln and chimney resembles the trunk of an elephant. It has a stove in front of the kiln and a chimney in the back.

The fourth type of kiln is the loh tuuk, i.e. boat kiln. The shape looks similar to that of the elephant kiln, but it has openings for firing the bricks on both sides, which look like eyes (this kiln is also called loh pneek or eyes kiln). Because of these "eyes", the length of this type of kiln is in principle unlimited, while the maximum length of an elephant kiln is 7 meters, according to our informants.

Chapter Three

Brick and Tile Manufacturing

3.1 The Products

Although this chapter is titled 'brick and tile manufacturing', we mainly discuss the production of bricks. Roof tiles form a small part of the output of the factories we visited and of the industry as a whole in North West Cambodia. Brick making is nearly always the main activity of a plant. This is partly due to the fact that Cambodian tile manufacturers face severe competition from Thai and Vietnamese producers.[15] Another reason the entrepreneurs mentioned is that tile manufacturing is a much more complicated process than the production of bricks.

Examples of the three products manufactured in North West Cambodia

Basically, the output of this sector can be categorized into three types of product: hollow bricks, solid bricks and roof tiles. Of the two kinds of bricks, hollow bricks are by far the most popular, accounting for up to ninety percent of total output. Solid bricks are normally used for the foundation of buildings because of their weight bearing capacity. Hollow bricks usually only occupy space. In the kiln, solid bricks are used as foundation and to cover the hollow bricks. Roof tiles are normally fired in the same kiln as bricks, though the manufacturing and drying period for tiles is much longer. The sizes of the three products are standardized, with some local variation. Figure 3 indicates the average size and weight of each product.

No	Product Type	Size of the Product			Weight
		Length	Width	Height
1	Hollow Brick	190 mm	90 mm	90 mm	1.5 kg
2	Solid Brick	190 mm	90 mm	45 mm	1.0 kg
3	Roofing Tile	320 mm	210 mm	20 mm	2.0 kg

Figure 3: Characteristics of North West Cambodian Bricks and Roof Tiles [16]

In general, bricks can be described as blocks of tampered clay molded to suitable shapes and sizes while still in a plastic condition (Surendra Singh 1987:32). Bricks are broadly classified into the two categories of sun-dried bricks and burnt bricks. The first type of bricks are dried in the sun after molding and can only be used in the construction of temporary structures. This