Private sector urged to boost contract farming investments

Private sector urged to boost contract farming investments

Contract farming is expected to create a more competitive market, lower transaction costs for farmers, leading to more diversified income and increased profitability, particularly for small-scale farmers.

Vongsey Vissoth, Permanent Deputy Prime Minister and the Minister in Charge of the Office of the Council of Ministers, called on companies to strengthen partnerships with local farmers through contract farming during a visit to cassava and rubber processing factories and mixed agro-industrial investment projects in Kampong Thom province, on Saturday.

Deputy Prime Minister Vissoth, who also chairs the Royal Government Working Group in Kampong Thom province was accompanied by Thor Chetha, Minister of Water Resources and Meteorology, the Deputy Chairman and members of the Royal Government Working Group, provincial administration officials, and relevant sector experts.

The mission aimed to assess operational challenges and explore measures to enhance productivity, value addition, and competitiveness in the province’s agro-industrial sector.

“The purpose of this visit is to resolve on-site challenges faced by investors, producers, communities, and farmers. By improving production capacity and value-added outputs, we can attract more investment, create jobs, and increase incomes for local communities,” Deputy Prime Minister Vissoth said.

“This aligns with the strategic directives of Prime Minister Hun Manet to promote sustainable socio-economic development across Cambodia.”

The delegation began their visit in the morning at a cassava processing plant in Ballang commune, Baray district. Covering 22 hectares, the plant initially operated between 2013 and 2014 with a pilot production capacity of around 4,000 tonnes but has been suspended due to market constraints.

The Deputy Prime Minister emphasised the importance of reviving such facilities to strengthen local supply chains and support farmers.

The delegation also visited the AVC Investment Co Ltd, a $25 million agro-industrial project spanning 57 hectares in Pokok commune, Stoung district.

The project produces cassava flour and sliced cassava, while converting processing waste into organic fertiliser, animal feed, and biomass energy.

The company also operates a wood pellet line and a fruit freezing plant, with operations scheduled to begin in June 2026.

Vissoth encouraged the company to adopt best practices from successful operations, optimise logistics, and leverage energy-efficient technologies to reduce production costs.

The mission also included inspections of rubber processing operations by CRCK II Rubber Development and Bien Heack Investment Co Ltd., which jointly cultivate 16,268.68 hectares of rubber and have invested approximately $100 million.

The facilities employ 3,600 workers and produced 48,000 tonnes of processed rubber in 2025.

Highlighting the role of contract farming, Vissoth urged companies to purchase agricultural products directly from local farmers and communities.

He suggested providing support such as working capital, quality seeds, and technology transfer to strengthen domestic supply chains, expand production capacity, and boost export potential.

“By linking investors and local farmers through structured agreements, we can ensure sustainable growth for both businesses and communities,” he said.

Kampong Thom province, recognised for its agricultural potential, currently cultivates over 54,000 hectares of cassava with an annual output of around 1.2 million tonnes, and approximately 73,000 hectares of rubber.

With targeted investments and strengthened public-private collaboration, the province is poised to become a key driver of Cambodia’s agro-industrial development.

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