By Michael Shean
January 26, 2010
CAMBODIA: Future Growth Rate of Rice Production Uncertain
Cambodia has recently re-entered the world market as a rice exporting nation, following a 30-year hiatus caused by war, political isolation, and a decimated agricultural sector. A resurgence of rice cultivation is occurring all across the nation’s vast lowlands, as the rural population expands and previously abandoned or mined farmland is brought back into production. Rice production growth in Cambodia over the past 10-12 years has been surprisingly strong, increasing at a 9 percent annual growth rate. At the same time, rice exports have increased from zero in MY 2000/01 to an estimated 800,000 tons this year (MY 2009/10). Given the country’s recent success in achieving surplus rice production, the Cambodian government is intent on expanding its production and export capacity and becoming a major rice export nation. Public statements by government ministers in the last year indicate that Cambodia wants to double rough rice production by 2015 to approximately 15.0 million tons (9.45 million milled basis) and export 8.0 million (5.0 million tons milled rice). Although it is apparent that Cambodia has all the required natural resources (ample land and water) to make this possible, serious constraints plague the nation’s rice sector and its future growth potential is uncertain. Analysts from the USDA Foreign Agricultural Service (FAS), the Economic Research Service, and the U.S. Embassy in Phnom Penh investigated rice production prospects in Cambodia and the outlook for continued growth in the sector during recent travel in the country.
Rice Production Environment
It is generally believed that rice has been continuously cultivated in Asia for over 10,000 years, having been first domesticated in eastern India and the lowland plains of Southeast Asia. In Cambodia today, rice is the overwhelmingly predominant food crop, being grown on an estimated 2.3 million hectares or nearly 85 percent of the country’s total cultivated area. The rice cultivars grown are incredibly diverse, with crop scientists estimating there are over 3000 varieties being cultivated in the country. Cambodia is roughly the size of Oklahoma (69,900 square miles) and has a vast central alluvial plain devoted to rice farming. This large lowland plain is dissected by several major rivers, including the Mekong and Tonle Sap, and is covered by ancient, highly-weathered and relatively infertile soils. The lowland plain itself surrounds a very large wetland area, and includes Cambodia’s largest inland water body, Tonle Sap lake or “Great Lake.”
Rice is grown over a diverse landscape, and encompasses four major rice producing ecosystems (Rainfed Upland, Rainfed Lowland, Deepwater or Floating Rice, and Irrigated Dry Season or Recession Rice). The predominant growing environment is the rainfed lowland rice crop, which accounts for over 90 percent of total wet season crop area. The country’s rice growing regions experience distinct wet and dry seasons, with the majority of the national crop being cultivated during the summer monsoon wet season. Roughly 80 percent of national rice production occurs in the wet season (86% of total rice area), with 20 percent produced in the predominantly irrigated dry winter period (14% of total area). The rainfall pattern is highly erratic, with drought and floods being regular occurrences (often in the same season). The government estimates that approximately 27 percent of the wet season rice crop is at least partially irrigated, while the dry season crop is essentially fully irrigated. Government irrigation figures are reportedly inflated to some degree, given they classify recession rice acreage as being irrigated (though the water source is actually receding floodwaters), and also include areas with non-functioning irrigation systems. Information about Cambodia’s rice production is difficult to obtain and is sometimes crudely estimated. Various organizations have issued reports on the topic and data is frequently conflicting. It was attempted in this report to use the most reliable information available and attribute information to its source.
Cambodia’s population is currently estimated by the Ministry of Planning’s National Institute of Statistics (NIS) in the 2008 Population Census and by the World Bank at roughly 14.0 million, and is growing rapidly (1.7% per annum). Approximately 80 percent of the population resides in rural areas and 71 percent are estimated to be solely dependent on agriculture (largely rice cultivation) for their livelihoods. The average farm size in the country varies by region and population density, with the largest in the northwest provinces at 2-4 hectares and smallest in the southeast at 1-2 hectares. In the crowded southern Mekong River region, farms often average less than 1 hectare, but nationally farm size averages approximately 1.2 hectares.
Rice farmers in Cambodia are predominantly subsistence producers, with the World Bank estimating only 40 percent of growers are generally capable of generating a marketable surplus. Average national rice crop yields are among the lowest in Southeast Asia, despite a decade of very strong growth following the gradual adoption of improved varieties and expanded use of irrigation. Chemical fertilizer use is extremely low and native soils are often very infertile. The United Nations Food and Agricultural Organization (FAO) estimates that Cambodia has the lowest rate of fertilizer use for rice in Southeast Asia, with only about 30 percent of total area receiving even minimal applications. Virtually all land fertilized receives well-below recommended levels of nutrients. The majority of farm producers do not have officially documented land titles, and therefore have diminished capacity to secure affordable lines of credit for either crop production or land improvements (irrigation). The severe shortage of agricultural credit in Cambodia is crippling rice producers capacity to continue to increase productivity and output, due to their inability to adequately finance purchases of improved higher-yielding seed, fertilizer, pesticides, farm machinery, and grain storage equipment. Expansion of cultivated acreage is also becoming problematic owing to a gradual decline in the rural labor force. An expanding national economy has resulted in a net migration to urban areas in recent years, and rapidly increasing rural labor costs. Farmers, government officials, and development authorities indicated that there was a critical manpower shortage during periods of peak demand for rice cultivation (planting, transplanting, harvesting) and that further growth in national acreage would require a substantial increase in farm mechanization.
USDA estimates marketing year 2009/10 Cambodian milled rice production at a record 4.63 million tons, up 2.4 percent from 2008/09 – the fifth consecutive record harvest. Over the past 12 years national rice production has more than doubled, rising 110 percent over the period from a level of 2.2 million tons in 1998/99. The scale of improvement in the past 5 years has been unprecedented, with average milled rice production reaching 4.2 million tons or a 74 percent increase over the previous 10 year period (when production had already recovered to pre-war levels). The unusually strong recent growth has been attributed by both private and public sector officials to a significant increase in cultivated rice area (26 percent) and crop yields (40 percent). Government statistics indicate wet season crop area and production expanded 2.2 percent and 7.2 percent per annum respectively, while dry season area and production increased by 5.5 percent and 10.5 percent.
The expansion of rice area was largely achieved by gradually bringing abandoned or idle farm lands back into production, while small amounts of forested land was also converted by slash and burn farmers in upland areas. Prior to the Vietnam and Cambodian wars, national rice area was estimated at approximately 2.4 million hectares. During the peak war years the rural population was decimated by periods of extreme warfare, political oppression, starvation, and genocide. Cultivated rice area was estimated to have averaged under a million hectares during the 1970’s, representing a decline of approximately 70 percent. Gradually, following the restoration of peace in Cambodia after the successful culmination of the Paris Peace Talks in 1991, the rural population began to grow again and repopulate the countryside. Only as recently as 2004 has cultivated national rice area returned to the levels common in the 1960’s.
According to a wide range of public and private sector rice industry and research officials interviewed during USDA’s rice tour, several other factors played a major role in the country’s rice production success story over the past decade. Chief among these were a considerable expansion of the nation’s irrigation infrastructure, increased use of improved high yielding rice varieties, and the intensification of the crop cycle through introduction of double-cropping in the main wet season. Collectively, these advancements catalyzed a dramatic increase in national rice crop yields, which rose by 54 percent between 1998/99 and 2008/09.
According to Cambodia’s Ministry of Water Resources and Meteorology (MOWRAM), national irrigated acreage increased by nearly 650,000 hectares or 162 percent between 1996-2007, though these estimates are to some degree exaggerated owing to the inclusion of recession rice acreage (sown on land as annual floodwaters recede) and land where irrigation systems are broken and inoperable. Irrespective of the actual irrigated area estimate, it is evident that a significant increase in overall irrigated rice acreage has occurred, and that this infrastructure has definitely contributed to the strong recent growth in national rice yields. The government has made a concerted effort to acquire international loans and grants to expand the reach of its national irrigation infrastructure, and this effort has born fruit in the rice sector.
In addition, scientists at the Cambodian Agricultural Research and Development Institute (CARDI) report that there has been a significant increase in the adoption of improved high-yielding rice varieties by Cambodian famers in recent years. CARDI estimated that roughly 40 percent of all rice acreage was under improved varieties in 2008, a 25 percent increase over levels achieved in 2003. Research officials indicated that CARDI was officially established in 1998, and that it focused on enhancing yields in traditional varieties grown in the country. It was also reported that a considerable grass-roots effort on a regional level to demonstrate the improved yield and grain quality attributes of new CARDI-developed varieties was finally taking hold, with new farmer inquiries outstripping available seed supplies.
One of the most important means through which Cambodia has achieved its strong recent rice production growth has been through modifying the traditional summer wet season cropping cycle, and bringing much more land under an intensive double-cropping regime. Historically, the great majority of rice farmers sowed and harvested a single annual rice crop. However, following the re-establishment of peace in the country, the International Rice Research Institute (IRRI) and the Australian Agency for International Development quickly repatriated native Cambodian seed varieties lost in the war years, while also introducing high-yielding short season varieties (maturing in 120 days or less) capable of revolutionizing the rice cropping cycle. These initial steps at revitalizing the genetic rice stock in the country and rapidly increasing rice production potential in the main summer growing season put Cambodia back on the path toward rice self-sufficiency. As of 2008 CARDI reported that three-quarters of all summer rice acreage is cultivated with improved high-yielding short-season varieties, enabling farmers to grow two-three crops in a single year. The net result of improving the varietal stock cultivated in Cambodia, creating the capacity to double-crop in the wet season, and expand irrigated rice area was to dramatically boost national crop yields. According to official government statistics, wet season rice yields have doubled since 1990 while dry season crop yields have risen approximately 54 percent.
Land Resources and Irrigation
Cambodia is blessed with ample land and water resources, which if properly developed and managed can be harnessed to expand its agricultural sector, increase rural incomes, and improve the national economy as a whole. With a rapidly growing, impoverished, and largely agrarian population, Cambodia would benefit greatly from development that would result in optimally productive use of the land. The total land area of the country is estimated at over 18.0 million hectares, with only 2.7 million hectares or 15 percent currently being devoted to agriculture (predominantly rice farming).
As of 2004, the nation’s forest lands were estimated by the World Bank at 8.0 million hectares (44.5 percent of total land area), down 5.1 million or 39 percent from levels recorded in 1970. The illegal extraction of timber has been rife for decades, while clear-cutting of land devoted to forest or agricultural concessions has also contributed to the significant reduction in the nation’s forest resources. The second largest land use behind forest cover is actually land devoted to economic concessions, or private sector company development. The concessions are typically located on previously forested or degraded Government (State-owned) land and often devoted to plantation-style industrial agro-forestry production of trees suitable for building material, pulp and paper, or for rubber. Cassava production is the single largest product grown from land concessions devoted to agriculture, with total field crop agricultural concessions estimated to be only 0.8 million hectares or 21 percent of total concession lands.
The fourth largest land use category in the country in terms of land area is scrub land. This land category is widely distributed and contiguous to both existing cultivated farmland and forest. The scrub land as defined in the table above was formerly tropical forest before rural landowners and/or loggers harvested the bulk of the timber. Much of the non-forested scrub lands visible in satellite images of the country have already been allocated for use as economic concessions, though the World Bank reported at least 1.7 million hectares remain intact. The location of these lands on the periphery of all the major crop land and populated areas in the country is not unexpected. Recent reports from the United Nations Development Program (UNDP) highlight the fact that an estimated 92 percent of the population relies on firewood for cooking fuel, and that projects to provide alternative fuels are a major focus of environmental programs in the country.
The Cambodian government wants to double rice production in the next 5 years and radically boost its commercial international rice exports. These goals will be virtually impossible without an expansion of the country’s irrigation infrastructure and a significant increase in cultivated rice area. The potential arable land area of the country has been estimated at roughly 3.6 million hectares by respected international authorities, though officials in the Cambodian government (National Institute of Statistics) have argued that up to 6.0-6.5 million hectares could potentially be converted to agricultural use. Cambodian agricultural development officials have also indicated they believe rice area itself could be expanded to approximately 3.5 million hectares, an increase of roughly 1.2 million hectares or 52 percent. No matter what the most realistic figure is, it is apparent that a large portion of existing non-forested scrub land would have to be targeted for agricultural conversion should the government follow-through on its rice sector development plans. Any significant agricultural expansion would in turn cause considerable additional pressure on the remaining forest lands, as the population seeks new sources of building material, fuel and fodder. Cambodia has essentially boxed itself into a land use and environmental quandary by allocating over 20 percent of its national land area to privately-held industrial forest and agricultural concessions, many of which have 99 year leases. As it is, these vast concession lands are the only real buffer between areas suitable for agricultural conversion and the country’s remaining tropical forests. At some point, given the government’s agricultural expansion intentions, these lands will become a source of contention between social development forces and those of commercial interests.
As indicated earlier, the nation’s irrigation infrastructure has been gradually growing over the past two decades. This has been a major focus of the government in terms of enabling farmers to achieve higher crop yields, reducing vulnerability to drought, stabilizing rice production potential, and increasing national food security or self-sufficiency. Despite this growth, Cambodia’s irrigation resources remain significantly under-developed. In comparison to similar rice cultivation environments in the lowlands of Thailand or the Mekong Delta in Vietnam, Cambodia has barely scratched the surface in regards to bringing higher concentrations of rice land under irrigation. In Cambodia, MOWRAM estimates that approximately 24 percent of the country’s rice land is irrigated. By comparison, 50-75 percent of the land in the lowlands of south-central Thailand and southern Vietnam has been successfully brought under irrigation after decades of investment and development.
The Cambodian government recognizes that its goal of joining the ranks of the world’s major rice export nations will require considerable additional development of its irrigation infrastructure in the heavily populated southeastern Mekong River floodplain and in the lowlands surrounding Tonle Sap, Cambodia’s “great lake.” The Ministry of Water Resources and Meteorology (MOWRAM) has reported that they successfully brought approximately 650,000 hectares of rice area under irrigation between 1996 and 2007, and have plans and finance sufficient to irrigate an additional 800,000 hectares over the next decade. The government has had a very proactive campaign in recent years to acquire financial assistance (grants and loans) from international donors and foreign governments for major construction projects directed at the agricultural and energy sectors. In total, MOWRAM acknowledged that it had received commitments totaling US $1.1 billion for irrigation infrastructure development, with an additional US $850 million pledged in October 2009 from the Chinese government for the construction of dams (hydro), irrigation, roads, and port upgrades. The roughly two billion dollars in pledged development assistance has the potential, given it is leveraged wisely, to substantially alter the status quo in the agricultural sector. Cambodia is one of the poorest nations in Asia, and this scale of investment in a country the size of Oklahoma, if not squandered on ill-conceived or poorly implemented projects, could help underpin additional agricultural and economic expansion.
It is apparent that Cambodia has sufficient land and water resources to theoretically enable sustained long-term expansion of its agricultural production capacity, including the rice, agro-forestry, fisheries, and livestock sectors. However, as with all national-scale development initiatives, the devil is in the details, and it is uncertain whether the government can succeed in maintaining recent growth rates. USDA employees touring the country uncovered or observed significant constraints that are presently plaguing the rice production, milling, and export capacity of the country. These problems are fundamental obstacles or limitations to future growth, and there is a need for government policy, programs, and budgets sufficient to address them. The government has prioritized achievement of a massive irrigation infrastructure construction program over other approaches that would support other rudimentary agricultural or rural economic and development needs. As a result, the areas/issues outlined below will likely remain long-term impediments to Cambodia’s future rice production potential.
Core Constraints to Rice Production Growth:
• Extreme under-funding of agricultural crop extension programs
- Severe lack of educated and experienced extension officers
- Severe insufficiency in on-farm technology transfer and farming systems training and assistance
• Significantly inadequate funding for scientific agricultural research
- Government relies almost totally on international donors for crop research
- Recent research funding crisis may cripple CARDI activities
• Extremely low production and availability of improved rice seed
- 2,000 tons of certified seed produced annually
- Sufficient for only 1.2 percent of national rice area
- Private company producing seed may be financially challenged
- Inability to increase production and rural distribution
- Improved seed uptake and usage rates threatened
• Virtually complete lack of commercial farm credit system
- Crippling lack of credit affects both producer and milling/export industries
- Lack of affordable credit ensures underinvestment in production capacity
- Farm mechanization (planters, harvesters) and industrial machinery (mills, grain dryers, storage facilities) severely inhibited
- Usage levels of improved seed and fertilizer severely inhibited
- Only 10% of farmers have land titles, inhibiting access to commercial credit at affordable rates
- Extremely low mechanization rates owing to lack of farm credit
•Rice crop yield growth rates stagnating
- Easy yield improvements already accomplished
- Double-crop acreage stagnating over past 10 years
- Farmers lack capital to regularly (annually) refresh planting seed stocks
- New cultivars require more fertilizer, irrigation, and improved agronomic management – farmers lack needed capital/credit/training
•Irrigation expansion threatened
- Poor engineering plagues many existing systems
- Almost total lack of system maintenance owing to expensive and unpopular farm-level user fees
- Systems developed in regions with unsuitable soils or other physical problems
- Many systems are not sustainable over a 10-20 year timeframe
- Lack of farm credit inhibits affordability of on-farm irrigation equipment (pumps, fuel) and tertiary access (feeder canal construction)
The United States Agency for International Development (USAID) estimates that total current annual Cambodian government outlays for agricultural programs (except irrigation development) in 2010 account for roughly 1 percent of the national budget. This is despite 80 percent of the population being rural, with fully 71 percent being totally dependent on agriculture for its livelihood. Lack of sufficient government funding and focus severely constrains current and future agricultural research and extension activities throughout the country. Both CARDI and the Ministry of Agriculture, Fisheries, and Forestry (MAFF) need substantial increases in government funding, as well as effective management oversight, if they are to expand and enhance crop and farming systems research, farm-level agricultural extension (technology transfer), and improved certified seed (IR) production and distribution - possibly subsidizing IR seed costs to farmers.
The establishment of a national farm credit system, and a radical increase in the titling of agricultural lands, so that the average farmer has adequate access to credit and the ability to invest in production enhancements (equipment, IR seeds, crop inputs, labor, irrigation, grain storage, land improvements), should be made a priority. Plans for expanding irrigation should be implemented in a gradual sustainable fashion. This means learning from past mistakes and correcting broken, mismanaged, or ineffective systems that already exist. There is also a need for the development of an effective and well-financed rural irrigation engineering and credit system designed to aid producers in on-site maintenance of current irrigation systems, as the lack of sustainability of the core infrastructure is a major long-term problem. There is also the need to take a sober look at the feasibility of expanding its arable lands, and the trade-offs in future land use which will have to be made with existing finite land resources. Greater focus on these major endemic underlying issues in the agricultural sector, combined with effective programmatic responses and adequately funded agricultural extension and research, are essential to ensure the success of the government’s plans to double rice production in the near future. A continued overriding focus on major infrastructural investments without equal or greater attention paid to the other agricultural or rural economic and development needs is likely to hinder further development of Cambodia’s vaunted agricultural growth potential.
Current USDA area and production estimates for grains and other agricultural commodities are available on IPAD's Agricultural Production page or at PSD Online.
For more information contact Michael Shean firstname.lastname@example.org (202) 720-7366
USDA-FAS, Office of Global Analysis