Agricultural production accounts for 35 percent of Cambodia’s GDP, but employs 56 percent of the labor force.Main products from the sector are rice, rubber, corn, vegetables, cashews and cassava. Unprocessed agricultural exports were projected to be more than 90 percent of total agricultural exports in 2015.
Agricultural gross production grew by 8.7 percent between 2004 and 2012, driven by crop production, mainly of paddy rice (annual growth of 9 percent), maize (20 percent), cassava (51 percent), sugarcane (22 percent), and vegetables (10 percent). The growth has been slowed remarkably since then.
The average growth of yields across crops between 2004–2012 was estimated at 4 percent, as a result of adoption of improved technologies, more irrigation system and better access to mechanized services. It has a long way to go, however. The Asian Development Bank study Improving Rice Production and Commercialization in Cambodia found that Cambodia’s average rice yield is low compared to its neighbors—little more than half the yield that Vietnam achieves, for example.
Source: Improving rice production and commercialization in Cambodia, Asian Development Bank, 2014
There are very different sizes of enterprise, from industrial down to smallholdings. In the last decade, larger farms (more than 3 ha) have tended to become larger and small farms (less than 1 ha) to become smaller.
The economic land concessions (ELC) programme that began in the 1990s gave long-term leases to companies to clear land for industrial agriculture: large-scale plantations and factories to process agricultural products. The Ministry of Agriculture, Forests and Fisheries website states that between 1996 and June 2012, the Ministry signed ELC contracts covering 1,204,750 hectares. However, data from NGO Licadho (which excludes land allocated for mining exploration) suggests that 2.14 million hectares have been leased.
Much of the increased production of products such as rubber and cassava is the result of industrial agriculture, which has been a key focus of the government’s agricultural development strategy.
But the massive ELC program has not added significant value. As a 2015 World Bank report found, “Except for rice, the agroprocessing industry has played a limited role in agricultural growth. Almost all crops were exported to neighboring countries unprocessed.”
Small and medium
The first-ever agricultural census in 2013 found that 1.9 million households had agricultural holdings, meaning they have at least two large livestock or three small livestock or 25 poultry or land equal to 300 square meters. The total land areas of agricultural holdings was 3.1 million hectares, in 3.7 million parcels.
While some small farms have seen productivity improvements in past years, the productivity of most smallholdings has remained low, as agricultural extension and other services have often not reached them. An Asian Development Bank study on rice production found that the size of the area cultivated by farm was the most important determinant of improved production and commercialization, noting that increasing the area of cultivated land can be achieved through either land acquisition, or increasing the number of annual harvests.
According to the 2013 agricultural census, the households with agricultural holdings housed 28 million chickens, 5 million ducks, 2.7 million cattle, 1.4 million pigs, 472,000 buffalo and a few thousand goats. Livestock holdings are typically very small, between 10 and 100 pigs, for example.
It is an area of farming with some significant constraints—e.g. small average stock holdings, regulatory gaps, disease—and the growth in livestock has been modest. In fact, the importance of livestock production in agricultural value added (the value of gross production less the value of intermediate farm inputs) declined from 17 percent in 2002 to 14 percent in 2012.
Higher production performance and quality standards usually come from higher stock numbers, so the small holdings and land size of most households constrains growth in the sector. Standards are impacted by regulatory gaps around livestock production, including animal raising, live animal traders, slaughterhouses, meat dealers and market sellers.
Disease is a constraint to cattle production. There have been a number of large outbreaks of bovine foot and mouth disease in Cambodia since 2000, including 2005 and 2013.
The Cambodian Organic Agricultural Association represents and supports organic farmers in Cambodia. Together with the Cambodian Center for Study and Development in Agriculture (CEDAC), they certify products as organic or chemical-free. Given the small scale of the industry, international certification is too expensive, but there is a push towards certification within the Southeast Asia region. There is already an existing standard, the Asia Regional Organic Standard. German development agency, GIZ, has supported the development of organic farming in Cambodia.
Unlike developed countries, organic fruit and vegetables do not always command significantly higher market prices in Cambodia. There is a good argument, however, that they should: technical advisers to the industry say some of the most toxic pesticides, banned by the World Health Organisation, are still available in Cambodia, with little government enforcement or regulation of their use. Challenges in greater adoption of organic farming include the fact that it requires new skills and knowledge, and that the products may grow at a slower pace than those that are treated with chemicals.
Last update: 6 April 2016
Related to agricultural production
- Agricultural policy and administration
- Agricultural commodities, processing and products
Key agricultural commodities and products include rice, rubber, corn (maize), vegetables and fruit, and cassava (tapioca). More than 90 percent of Cambodia’s agricultural exports in 2015 were unprocessed.
The country’s agricultural gross production grew by 8.7% annually over 2004–2012, one of the highest growth rates in the world. This growth largely came from big jumps in crop production of paddy rice (9% annual growth), maize (20%), cassava (51%), sugarcane (22%), and vegetables (10%).
However, in 2013–2014, agricultural growth slowed down to 1%. Cambodia’s 2014 export of about 387,100 tonnes of rice was an increase of just 2% over the 378,850 tonnes shipped in 2013. Prices were down around 30%. The government’s target of 1 million tonnes of rice exports in 2015 (set in 2010) was not met. There have been reduced prices for other products too, including rubber and corn.
High quality, big challenges
A number of Cambodian products have an international reputation for high quality. For three years running in 2012, 2013 and 2014 Cambodian premium jasmine rice won World’s Best Rice award. Kampot pepper has Geographical Indication (GI) status, a World Trade Organization initiative that links the quality of a product to its origin.
Yet there are big hurdles to overcome in developing the agricultural sector, building processing industries and securing large export growth. Some of the issues:
- There is a severe lack of processing facilities for many products including rice, rubber and cashews.
- A lack of storage facilities for many agricultural commodities, including rice, corn and rubber, means they must be sold when they are harvested, regardless of the market price at the time – they cannot be stored until prices rise. There are still many areas of the country where there is no electricity supply, and power prices are high compared to some other countries in the region. This makes it harder to develop processing industries, and makes operating costs higher.
- Global food and commodity prices have fallen, and are not forecast to rise significantly.
- Some producers talk about transport and infrastructure problems, such as the difficulty of getting large volumes of rice exported through the port.
- There is an extremely limited budget for promoting Cambodian products overseas.
- Some agricultural products are only exported to neighboring countries, and demand and prices can be volatile.
Agricultural development, particularly the growth of processing, is a big element of the Cambodia Industrial Development Policy 2015–2025 that was publicly launched in August 2015. A key target in the policy is increasing processed agricultural exports to 12 percent, a 4 percent increase on the figure for 2015.
Commodities and products
There are big differences in what can be earned from different crops, and World Bank research indicates that different margins may be driving some changes in Cambodia. The share of total area planted under paddy rice declined from 86 to 74 percent from 2002 to 2011, while the share of area for maize and cassava production increased significantly. In 2013, average farm gross margins (and returns to labor) were $506/ha ($9.4/day) for cassava, $303/ha ($8.8/day) for maize, and $1,393/ha ($7.2/day) for vegetable production, compared to $245/ha ($4.6/day) for wet season rice and $296/ha ($9.6/day) for dry season rice.
Within rice production there are changes too. More farmers are producing aromatic paddy, which is more profitable. Production is estimated at 10 percent of the rice cultivated area and 30 percent of total production.
World rubber prices hit a peak of $4,850 per tonne in 2011, but then gradually fell down to $1,100 per tonne at the start of 2016. Deliberately reduced output from some major rubber-producing countries led to an improvement in price to $1,580 per tonne by October 2016.
Ministry of Agriculture, Forestry and Fisheries data shows that exports for the first 9 months of 2016 were 82,825 tons, up almost 11 percent from the same period in the previous year. The land area under cultivation has also risen, to 402,310 hectares in September 2016. This means that the government's target of 400,000 hectares by 2020 has already been exceeded.
Source: Singapore/Malaysia rubber price
The area under cassava more than doubled in the years 2005–2013.
A lack of processing factories in Cambodia means there is little value added, however. Instead of exporting products such as cassava chips, mostly unprocessed cassava and cassava flour is exported to Thailand, Vietnam and China. Cambodia’s raw cassava is processed in these countries and reexported.
Cambodia exported 173,387 tons of unprocessed cassava and cassava flour in the first quarter of 2016, Ministry of Commerce figures show. (In 2015, Thailand exported 7.46 million tons of cassava chips worth $1.56 billion to China alone.)
Corn has faced falling prices and falling export demand in recent years. Prices in 2014 were 40 percent below those of 2013. Battambang leads Cambodia’s corn production with over 27,000 hectares. On average, farmers are producing up to 4 tonnes of corn per hectare. Lack of storage silos is a major problem.
Last update: 14 December 2016