CAMBODIA – New Crops Enhance Smallholder Climate Change Resilience and Economic Stability

The Melon Association Siem Reap Meanchey (MASC) addresses climate finance challenges through a three-year strategic business action plan that aims to improve the association’s capacity for collective sales and purchases, enhance market supply, and better utilize revolving funds inclusively year-round.

Upon the implementation of this business plan, MASC has seen significant growth and success through a 91% increase in members’ incomes through the cultivation of new crops such as melon, yellow watermelon, onion, garlic, cherry tomato, bell pepper, and asparagus. In addition, the association has effectively responded to market demands in Phnom Penh. This growth highlights the association’s effective strategies and commitment to supporting smallholders in their agricultural endeavors.

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MASC was founded in 2011 by 27 household members (5 female). MASC started with an initial capital of KHR 8,100,000 (USD 4,499). Currently, the MASC has 313 households as smallholder members (60 females). On average, members increased about 25 new household members each year.

In 2023, MASC was selected by the Cambodian Farmer Federation Association of Agricultural Producers (CFAP) to receive support from the APFP-FO4A program to fund its business plan. The APFP-FO4A program is implemented by the consortium Asian Farmers’ Association for Sustainable Rural Development (AFA) and La Via Campesina (LVC) and financed by the European Union (EU) and the International Fund for Agricultural Development (IFAD). CFAP is one of the national farmers’ organizations implementing the program in Cambodia.

MASC developed a comprehensive business plan that provides a clear strategy to enhance market supply regularly and optimize the use of a revolving fund, and organizational financial management, thus enabling the association to get access to climate finance in the future to expand production and business.

MASC’s business plan, which is implemented from December 2023 to December 2025, aims to bolster the association’s capacity for collective sales and purchases. The strategic business plan helps improve farmers’ livelihoods through increased productivity and improved quality of production to meet high market demands. New interested farmer members grow new crops to supply market demands collectively through MASC.

The business action plan focuses on:

• Enhancing the quality of crops to meet high market demands.
• Collaborating with big buyers/companies to ensure faster payments to the association, enabling timely payments to farmers.
• Seeking new markets both within and outside Cambodia to accommodate the increased production from members.
• Expanding farm areas to meet growing market demands.
• Introducing new crops like bell peppers, cherry tomatoes, and onions to satisfy market needs.
• Setting up an office for administrative work, a vegetable shop, a processing and packaging facility, and a cooler for storage.
• Increasing participation in trade fairs both domestically and internationally.
• Refining the cropping calendar to prevent market oversupply in the future.

Taking on the challenge of cultivating new crops was a unique decision for the association, but they have made remarkable progress in overcoming the obstacles associated with this endeavor. Despite initial difficulties including severe climate and soil conditions and high market demands, the association has successfully expanded its operations, while improving its agricultural practices.

MASC’s achievements include:

1. Growing its capital to KHR 160,000,000 (USD 39,772), and its land size has increased to 260 hectares.
2. Establishment of a collection center that handles members’ produce, with an average output of 28 tons per month.
3. MASC engages in selling melon and yellow watermelon seeds to members; collective sales and purchases of various crops from farmer members and vice versa; and, providing small agri-credit loans.
4. Successfully improving its members’ understanding of climate and soil conditions, leading to better farming practices and soil quality management. Rotational cropping and adherence to a clear cropping calendar are now in place to ensure the association can supply markets year-round.

Facilitating Factors and Challenges

• There is a lack of revolving fund capital within the association.
• Overlapping cropping schedules have led to market oversupply, exacerbated during the COVID-19 pandemic due to the travel restrictions of our coordinators.
• Problems with bad or fake seeds persist.
• Inconsistent reporting of schedules by members to the association.
• Late repayments from large companies impact cash flow from companies to MASC and farmer members.
• Crops sometimes do not align with market demands.
• Problems with transporting produce from farms to the collection center, there is no proper means to collect produce timely.
• Inflation and high market competition for imported products affect profitability.
• New members lack sufficient technical skills, and there is a shortage of experts for technical support.

Future Prospects

• Some members, like Heng Horn, aim to significantly expand their farm sizes from 3,000 square meters to 10,000 square meters to meet increased market demand.
• The association’s emphasis on crop rotation and sustainable soil practices helps improve long-term soil quality, and environmental resilience and avoid producing over-market demands, especially in the harvest season of other crops.

By addressing the challenges and continuing to refine its practices, MASC is poised to further enhance its impact and success in the Cambodian agricultural sector. MASC’s achievements also position it to influence policy, enabling farmers’ organizations to gain access to climate finance.

Despite having a strong structure from farm to market, MASC recognizes the need for collaboration with research institutes, large companies, international development partners, UN agencies, and government entities for policy support. In addition, MASC requires additional capital to ensure timely collection and supply of produce, provide technical training to new members, establish a processing and packaging collection center, need a cooling transportation van, expand its marketing team, collaborate with seed producers for quality assurance, and explore new market opportunities for the future.

Lessons Learned

• A strategic business plan, cropping schedule, use of a revolving fund, and technical training protocols help accelerate inclusive markets for MASC’s farmer members.
• Many farmers get interested in growing new crops and want to expand their farm size to increase their production to supply markets collectively year-round.
• CFAP sometimes conducted project monitoring and implementation, 2-3 times annually, and engaged the MASC in trade fairs and exhibitions to explore more market opportunities with big buyers.

Recommendations

• Development agencies and the government should focus more on direct funding to farmers’ organizations of at least 10% of the country development fund of IFAD and agricultural GDP of the government to improve agricultural production and quality of produce to meet high market demands and exports.
• To strengthen the institutional capacity of farmers’ organizations by building human resources to extend services directly and professionally to farmer members, investment in collection centers, processing, packaging, storage, and collective enterprising of members’ produce to markets year-round.
• Additional revolving funds to ensure the profitable business of farmers’ organizations that can run the organization expenses to serve the interest of farmer members.
• Policy to ensure that farmers, especially smallholders are profitable and agriculture is a business and farmers must be in the centric discussion at all levels.

View more photos: https://asiapacificfarmersforum.net/cambodia-business-plan-support-for-the-melon-association-in-siem-reap/