Sharp drop in paddy prices pushes farmers to the brink, even as PM offers help

Sharp drop in paddy prices pushes farmers to the brink, even as PM offers help

Prime Minister Hun Manet assures the farmers that agriculture remains a top priority sector, central to both rural development and national economic stability, and reaffirms the Royal Government’s firm resolve to address the pressing problems.

At 600 riels (or 0.15 cents), it would not be easy to get a standard candy, yet paddy in Cambodia is priced at 600 riels per kilogramme. It’s only natural that the pent-up anger of the farmers found its way to various social media platforms.

Normally ranged between 800-900 riels, farmers are now demanding at least 1,000 riels to sustain their livelihoods. They are also expected to repay loans for fertilisers, water supply and harvesting, often borrowed from microfinance institutions.

The grim situation was addressed by none other than Prime Minister Hun Manet yesterday. He pledged strong government support for the agricultural sector after farmers voiced concerns over plunging paddy prices, emphasising infrastructure, cost reduction and market access as key priorities to stabilise rural incomes.

Writing on his social media, Mr Hun Manet explained, “How has the Royal Government of Cambodia helped in facilitating the agricultural sector?”

The Premier emphasised that agriculture remains a priority sector, central to both rural development and national economic stability, reaffirming the Royal Government’s role in supporting farmers.

Mr Hun Manet said, “The Royal Government has paid great attention to the agricultural sector, which remains one of the priority sectors among others.”

“Aside from developing the irrigation and transportation systems to support the agricultural sector, the government has also considered helping farmers by reducing production costs while obtaining the highest possible yields,” he noted.

He explained that this approach involves deploying agricultural officials to communes to provide hands-on assistance in cultivation and processing, aimed at ensuring that technical knowledge directly strengthens farmers’ productivity and reduces their reliance on costly outside support.

Mr Hun Manet added that the establishment of the modern agricultural communities focuses on reducing expenses, achieving more productivity, having sufficient resources and creating more markets for farmers.

The Premier’s statement underscored the government’s continuing focus on infrastructure, cost reduction and market expansion, while also highlighting new initiatives aimed at easing farmers’ economic burdens and ensuring greater resilience in the agricultural sector.

It may be recalled that on August 17, the General Directorate of Agriculture (GDA) of the Ministry of Agriculture, Fisheries and Forestry (MAFF), urged farmers to avoid harvesting unripe paddy with excessive immature grains, warning that it reduces quality and drives down prices.

The GDA stressed that rice collectors are also reluctant to purchase such paddy, while harvesting only fully ripe paddy would bring better returns for farmers and ensure a higher-quality supply for processors.

Speaking to Khmer Times, Chey Tech, a socio-economic researcher, said that the recurring paddy and rice price drops are an annual problem, particularly during the harvest season.

He emphasised that if the Ministry of Agriculture, Forestry and Fisheries (MAFF) knows that paddy type 54 is less preferred by buyers, officials should establish contract farming agreements.

“Such arrangements would guarantee a committed purchase at a predetermined price, providing farmers with security while aligning production with market demand,” he said.

He explained that the price drops are driven in part by an imbalance between supply and demand, as farmers tend to grow the variety that fetched high prices the previous year, often ignoring market signals or buyer preferences.

“In addition, farmers face rising costs for essential agricultural inputs, including water supply, fertilisers, fuel and high-interest loans, which further erode their income,” he noted.

Tech stressed that urgent support from the ministry is necessary, not just in terms of policy incentives, but also to encourage oknhas to invest more in modern processing facilities.

These investments would reduce the outflow of raw materials to neighbouring countries, preventing external actors from manipulating prices and ensuring farmers receive fair compensation for their produce.

According to Tech, without these structural improvements and stronger government intervention, Cambodian farmers will continue to bear the economic burden, trapped in a cycle of low income, high costs and minimal market protection, despite their critical role in sustaining the nation’s food security and agricultural exports.

A farmer in Banteay Meanchey, who asked not to be named, confirmed to Khmer Times that the widely shared social media reports on falling paddy prices are accurate, as he is personally facing these financial and production challenges.

He said, “Buyers initially offered 800 riels per kilogramme at the start of the harvest, but prices have steadily fallen as harvesting nears completion, leaving many farmers struggling to cover production costs and repay loans from financial institutions.”

Operating about 90 hectares cultivating both paddy and cassava, he added that prices have now slipped to just 600 riels per kilogramme.

“Farmers are shocked to see paddy type 54, a variety usually grown during the dry season, drop so low in value,” he said, stressing that even the initial 800 riels was insufficient to cover expenses.

“The price of 800 riels wasn’t good either, but we had no choice. Farmers are seeking at least 1,000 riels per kilogramme to cover daily expenses and repay loans taken from microfinance institutions to fund cultivation, irrigation, and harvesting.”

It should be noted that farmers in provinces along the Thai border rely heavily on exporting paddy, rice and cassava to Thailand. With ongoing border restrictions, agricultural output has become congested, leaving farmers struggling with oversupply and sharply declining prices.

The drop in prices has sparked concerns over income security in rural communities, particularly as Cambodia works to strengthen food security and expand agricultural exports.

Farmers argued that production costs, including fertilisers, water supply and fuel, continue to rise while agricultural market prices remain unfavourable, creating a mounting financial strain for households dependent on agriculture as their primary source of income.

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