Increasing inflation and a reduced labour force are just two of the challenges Cambodia’s agriculture sector faces today, according to the head of EuroCham’s Agriculture Committee.
Eugene Kraamwinkel, also CEO of LN Agri Group, said there are challenges and many opportunities to be found in the nation’s agriculture industry, which forms one of the country’s three main economic pillars alongside manufacturing and services.
One major issue Cambodians farmers face is the global economic crisis, which is impacting the industry due to inflation driving up costs.
“Currently, inflation on food driven by high transport and logistics costs are hampering our ability to export,” he said. “If we can’t produce a low-cost, high-quality product, it becomes very difficult to export.”
Kraamwinkel, who runs a rubber and a cashew plantation in Kratie, added that one benefit is that Cambodia has relatively low food inflation of about 3.8 percent. This is due to the country producing a lot, meaning limited use of transport and logistics.
Another issue the sector faces is a dwindling number of people going into farming. “As the country develops its labour force, the agriculture sector is facing an increased dilemma of reduced labour,” he said.
“The conditions are tough, working long hours under the sun, and people move on quickly, especially when better conditions can be found at factories. We need to be able to pay our workers enough so that they will stay, but it becomes really difficult to make the sums balance if you do that.”
Kraamwinkel, who will deliver a talk on new technology within the industry at EuroCham's Cambodian AgriBusiness Perspectives event on April 28, said the industry has benefitted from the introduction of automated processes. This includes using drones to spray chemicals and fertilisers, and satellite imagery to detect diseases and count trees.
“This is more efficient and reduces safety hazards and workloads for workers, increasing productivity and accuracy,” he noted.
Sustainable Farming is Key
Kraamwinkel said sustainability within the sector is a major concern globally as more forests are felled to make way for agricultural land. “This is mainly due to the concept that increased agricultural land will supply enough food for the growing global food demand,” he noted.
“It’s, however, not that simple as the reduction in forests increases land temperature, which in turn increases the drying effect leading to a reduction in rain. By using more unsustainable farming methods, you’re also destroying the quality and structure of the soil.”
He said in Cambodia, “slash and burn” techniques are a common practice. This causes many nutrients to become volatile with the remaining ash being blown away. Very little of these nutrients ends up in the soil, impacting its quality.
“Destroying forests actually sets the agriculture sector back and we need to be careful with how we manage this sector. Currently Cambodia can sustain itself with its food supply, and it’s one of the few countries that can say that.”
According to the World Bank, by 2050 nine billion people worldwide will need to be fed. To achieve this, global agricultural production will need to increase by a staggering 70 percent.
“If we don’t get more involved in sustainable agriculture and agroforestry systems, we will not be able to provide for all the people on Earth,” Kraamwinkel said, adding Cambodia is ideally suited for some of these systems to be introduced.
“We have a lot of evergreen high forests, the height of the forest canopy causes a cooling effect and moisture buildup, leading to rain, and many farmers are starting to employ better practices.”
He gave the example of farmers keeping high-value timber on their land and planting cashew trees between taller trees. “Both keep on growing and, at the end of the day, this creates a positive outcome.”
In addition, Kraamwinkel highlighted work being carried out by SNV on sustainable farming and SmartAgro, which focuses on soil restoration. “We need to start looking at a system that benefits farmers employing sustainable practices, restoring soils and increasing productivity responsibly.”
Promoting best practices in the sector and getting farmers on board to implement them are key to improving produce quality and, as a result, export volume. Traceability and quality of products are also the two key requirements of export markets.
Forming cooperatives of small farmers will also help to elevate the sector, Kraamwinkel said. This would enable them to work together and sell their produce to a central market.
“Aside from finding better prices for the farmers by tapping into new markets, this cooperative could offer coaching on best practices as well,” he added. “Getting away from selling to traders is a big opportunity. The problem with traders is that they pit suppliers against suppliers and buyers against buyers to get the lowest possible price.”
As a result, farmers and landowners are the worst affected as they put in the hard work and do not receive a fair price for their products. “We need a system that can measure the quality and identify the sources of goods, which can lead to access to new markets and higher prices,” he suggested.
“We also need to work with farmers to educate them on new methods for farming, sustainability, traceability, regenerative agriculture, and the perks of forming cooperatives, to help them see a new way of doing things.”