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Farmers urged to enter contract farming scheme

Sok Chan / Khmer Times Share:
Green Leader’s representatives attend a ground breaking ceremony for their factory in April. KT/Mai Vireak

A forum on contract farming held yesterday in Kratie province sought to raise awareness among farmers of the advantages of these farming schemes and encourage them to partner up with a company that is now building a cassava starch factory in the Kingdom.

The forum was organised by Green Leader Holdings Group – a Hong Kong-based investment firm now building a cassava-processing plant in the province – with the collaboration of the United Nations Development Programme (UNDP) and several government agencies.

According to an event press release, the goal of the forum was to help farmers understand the benefits of entering a contract farming scheme with Green Leader, whose factory is expected to absorb about 400,000 tonnes of cassava per year.

“A contract farming for the upcoming harvesting season could employ 1,000 different households and could result in exports of 100,000 tonnes of starch worth $52 million.

“The linkage is done through a win-win contract farming model aiming to scale up benefits for both parties and as a mean to mitigate production and market risks,” the statement read.

It said that in addition to increasing incomes for local farmers and creating many high-paying jobs, the farming scheme will also create more value by processing local cassava into starch.

Kuy Huot, director of the Department of Agriculture in Kratie, told Khmer Times yesterday that the forum gives farmers the opportunity to partner up with Green Leader to raise their incomes.

“The goal was to raise awareness and trust among farmers.

“Green Leader’s factory will need about 400,000 tonnes of cassava a year, so we think it is a great opportunity for farmers in Kratie.”

Leang Reathmana, national management specialist at UNDP, said the scheme will reduce the market risk for farmers by linking them directly to the buyer.

“The contract farming applied in this context is not only a formal buy-sale contract, but also a partnership scheme in which farmers and the company work together to address their relevant individual and common issues while better benefiting both parties,” he said.

“In addition to offering a better price than in the local market, Green Leader will provide agricultural services on credit such as land preparation, planting, insecticide, pesticide, herbicide, fertilizer and harvesting. Farmers can opt for services they need and pay once selling their cassava to Green Leader.”

He said the contract farming scheme is expected to begin in January 2019, and will be limited to Kratie during the initial year. He said information regarding the price at which the cassava will be sold to Green Leader is not available yet.

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