Agricultural value chain bears fruit
How adopting a new crop helped boost incomes and climate resilience of Cambodian farmers
Local foods and other homegrown products are a specialty at the Siem Riep Farmers Market, an upscale supermarket in northern Cambodia. The yellow-flesh watermelons on display are particularly popular. Even though customers here are more familiar with tropical fruits such as pineapples and bananas, they also like the sweet taste of these green-skinned melons, which have distinctive black seeds neatly embedded throughout their ridged flesh. “Our customers buy the melons because they trust us,” says Kim Sang, manager of the supermarket. “We are known for selling high-quality products.”
The melons sold here are located at the end of a remarkable value chain. It begins at more than 200 farms in the surrounding countryside, then moves to a bustling distribution center in a nearby industrial area, where farmers bring tractor loads of the fruit. It then spreads out on trucks and vans to points of retail sale, including market stalls and supermarkets in Phnom Penh and other cities across the country. Along with the yellow-flesh watermelons, the farmers also grow sweet melons and cantaloupes. All of them end up in Cambodian homes and restaurants, having created value for farmers, distributors and retailers at every step of their journey.
iDE was instrumental in establishing this value chain, under our Climate Smart Commercial Horticulture Cambodia (CSmart) program. Funded by the New Zealand government, CSmart is targeting farmers in Siem Reap, Banteay Meanchey and Oddar Meanchey provinces, as part of a broader $14.3 million iDE program, the Cambodia Agribusiness Development Facility, which has been funded by New Zealand for nearly 20 years. The program is boosting incomes and creating a new market opportunity for 6,000 low-income farmers in the country, which has a poverty rate of almost 20 percent.
The World Bank says improving the performance of agricultural value chains in emerging countries like Cambodia will be crucial to ending poverty and hunger, boosting shared prosperity, and stewarding the world’s natural resources. To that end, as part of iDE’s commitment to building market systems that are competitive, inclusive and resilient, we’ve worked to support the sale of melons at various points along the chain, training farmers to run their farms as businesses, and enabling them to adapt to changing weather patterns.
Thanks in part to these efforts, local farmers have acquired the skills they need to navigate changes in the market — and in the climate. Below, I’ll explore how the program has supported Cambodian farmers in their transition to growing melons and other new crops, by focusing on three key links in this chain.
First link in the value chain: The melon farmer
Melon farmers sell yellow-flesh watermelons for about 2,500 riel (US $0.60) per kilogram, making a profit of about 700 riel ($0.15) per kilogram. One such farmer, Voeurn Sophea (right), had been a rice farmer for more than two decades, making a modest income. But drought and COVID-19 caused market prices to fluctuate, and she found herself struggling to provide for her family. With her future uncertain, she met with an iDE agronomist, who advised her to diversify the crops she produced, reducing her market risk, while encouraging her to try growing yellow-flesh watermelons, which fetch a high price compared to most other crops.
Because the melons are grown in the dry season, she planted the fruit vines in fallow rice paddies: She harvested two cycles in her first season, providing an additional income stream — and a handsome profit. She also started growing leafy greens, eggplants, cucumbers and chili peppers. To improve her water-use efficiency — both to increase her resilience to climate change and reduce the time she spent watering — iDE advised and assisted her in installing a drip irrigation system. She also planted in raised, flood-resistant beds and rolled out plastic mulch, which covers the ground around the crops, retaining moisture and reducing the amount of labor required for weeding.
“I like to try new things,” says Sophea. “The irrigation system saves me a lot of time I would otherwise spend carrying water from my pond using buckets.” Now serving as one of the “lead farmers” iDE has designated to help organize farmers in her community, Sophea holds community gatherings at her farm, showing her neighbors how to grow fruits and vegetables to supplement their incomes, and how to adapt their farming practices to combat unpredictable and often severe weather events.
Second link in the value chain: The melon association
Vann Ean (above) places a drop of melon juice onto the glass prism of a refractometer. Holding the lens of the instrument, used for measuring sugar content, to his right eye, he sees the reading he wants: At least 10 percent of the melon juice is sugar, meaning the fruit is sweet and delicious.
Quality control is important to Ean, who is chairman of the Siem Reap Melon Association — which iDE helped him establish in 2011, after he witnessed the potential of melon farming while visiting Thailand. Only high-standard melons — which must also weigh at least 1.2 kilograms and show no damage or deformities — will receive an association sticker proving their worth, before being resold to supermarkets chains. “The supermarkets buy from us because they know our melons are fresher than ones that come from abroad. Also, they really want to support local production,” he says.
The organization’s core function is to provide local farmers with a guaranteed buyer. Farmers from across three local provinces bring their produce to the association distribution center, where it is checked for quality and packed in cardboard boxes for resale. The association buys yellow-flesh watermelons for about 2,500 riel ($0.60) per kilogram and sells them for about 4,000 riel ($1.00) per kilogram. Farmers are paid 30 percent on delivery and the remainder two weeks later, after payments are received from supermarkets. Launched with just 27 members and initially processing an average of 3 or 4 tons of melons per month, the association now processes up to 30 tons per month and has more than 200 members, Ean says.
iDE continues to provide technical and managerial support to the association, which, in addition to its benefits for farmers, also guarantees buyers a year-round supply of melons. This consistency is the key to its success: Supermarkets, Ean says, want constant supply, which the association works hard to provide. By using a crop calendar, the association advises its growers when to plant their melons, which take two months to mature, spacing out the harvest times from farm to farm, and ensuring fresh crops are delivered to the distribution center every week. “It’s important that our farmers be reliable,” he explains. “We go to their farms and check the water source. And we make sure we have growers in highland areas in case the lowland farms are flooded.” New members also receive training from iDE on production, farm and food safety practices, and disease and pest control.
Third link in the value chain: The super market
Supermarkets buy yellow-flesh watermelons for about 4,000 riel ($1) per kilogram and sell them for about 6,000 riel ($1.50) per kilogram. Customer demand for these melons has been strong: To keep up, the supermarket in Siem Reap orders fresh batches of watermelons three or four times a week. This demand, driven by iDE’s marketing efforts, has resulted in 14 contractual agreements signed between major buyers and the melon association. To further support these key relationships, iDE has helped the association showcase melons at trade fairs, assisted the development of its branding practices and aided contract negotiations with supermarket chains.
Store manager Kim Sang (right) says his customers like the melons because they are affordable and free from pesticide and fertilizer residue. With the popularity of the melons increasing every season, he says the store is planning to keep selling as many as possible. “Before, people didn’t know what they were and didn’t buy them. But now people know them and really like them,” he explains.
By addressing these three links in the agricultural value chain, iDE has enabled individuals and businesses to work together, building interconnected, resilient market ecosystems and value chains in areas where commercial activity had once been lacking. The success of Cambodia’s melon value chain illustrates how prosperity can be created at every link, boosting incomes and improving the lives of thousands of people living in low-income communities. Similar efforts will be necessary — alongside increased investment in these value chains — if we hope to achieve the United Nations’ Sustainable Development Goals of ending poverty and hunger, boosting prosperity and job creation, and increasing climate resilience across the developing world.
CSmart's key datapoints
5,569 farmsteads (40% female-led) increased their annual farm profit by an average of $1,870 (baseline=US$830).
The average land area under horticulture farming per farmstead was 3,539m2
Increased the average crop yields from 1.3kg/m2 to 2.7kg/m2.
The yearly production of sweet melons varied from 300 to 500 tons, and yellow-flesh watermelons from 400-500 tons.
About 500 -1,000 hectares a year under low-cost system “red flesh” watermelon farming on the fallow rice fields, with average profit of US$1200 per ha.
Increased the percentage of farmsteads hired non-family laborers from 23% to 41%.
Strengthening business linkages between 256 farm gate collectors with at least 3,142 farmer suppliers.
Working closely with 43 local input suppliers to improve farmer access to agricultural inputs including personal protective equipment, and services.