The UN’s Global Reporting Initiative shows the Cambodia rice sector has faced significant sustainability challenges of decreasing returns for small-scale producers, inadequate uptake of responsible farming practices and smallholder engagement models amid calls for increasing organic production.
According to the report, with rice exports highly competitive in Southeast Asia and significantly dominated by Thai and Vietnamese companies, the further development of organic production and inclusive business models to serve growing markets for traceable agricultural products offers opportunities for Cambodia.
“A significant proportion of the population continues to live in rural areas and the majority sustains a livelihood from agriculture, especially rice,” the report said. “Much remains to be done to increase competitiveness and ensure that growth is sustainable and benefits local communities.”
The report said the increasing demand of customers for information on sustainable production and responsible business practices offers opportunities to boost the competitiveness of organic and fair-trade rice from Cambodia.
Amru Rice, one of the Kingdom’s rice exporters and the biggest organic rice buyer is working to drive positive transformation and improve common business practices.
Song Saran, CEO of Amru Rice, said that while Cambodia’s market share for organic products has remained static, local smallholders earn more on the implementation of sustainable models.
“We have partnered with them so they will not suffer and give up farming but if we don’t help them, they will not be able to escape poverty,” he said. “That why we are trying to provide them with a chance to diversify their crops beyond rice and encourage them to move into organic products.”
Saran said according to the report organic products have the potential to increase farmer revenue.
Currently, there are more than 20,000 tonnes of organic paddy which could be processed into about 10,000 tonnes of rice. Some 90 percent of organic rice is exported to the international market.
Saran said about 8,000 smallholders are producing organic rice across the country and most of them are in Preah Vihear, accounting for 5,000 farmers. “Implementing a sustainable model provides them with a stable revenue,” he said.
Amru Rice is a corporate social responsibility (CSR) platform member that has been involved in working on alleviating social, economic, and environmental challenges, providing development for increasing transparency in the business practices of Cambodian enterprises.
The CSR platform is implemented by the Gender Transformative and Responsible Agribusiness Investments in South East Asia (GRAISEA), a project run by Oxfam in Cambodia with a number of partners. It is engaged with more than 40 leading companies, chambers of commerce and civil society organisations to promote responsible business practices.
Chok Thoeun, the president of the organic rice community Boeng Leach Sambophal in Kampong Chhnang province’s Samakky Meanchey district, said that he earns about $10,000 per year from organic products plus $8,000 from paddy.
“We can receive a higher price from contract farming agreements. We also have an option to sell paddy to brokers who offer a higher price,” he said.
He said the community, which has 32 members and cultivates 30 hectares of organic paddy, has entered into a contract with Amru Rice. The community collects about 90 tonnes per year.
“We provide fertiliser at a lower price and receive training on how to check the quality of rice,” he said adding that the community is now seeking a $20,000 loan from Agricultural and Rural Development Bank (ARDB) for working capital.