In 2021, total rice production jumped to 12.2 metric tons, marking an 11.6% year-on-year increase. This surge was largely due to an increase in rainy season rice production, thanks to more favorable weather conditions.
Out of a rice production of 12.2 million metric tons, wet season rice contributed 9.26 million metric tons (76 percent) and dry season rice production contributed 2.93 million metric tons (24 percent). According to the US Department of Agriculture Foreign Agriculture Service, the 2021-22 production year has been positive for rice cultivation thanks to better weather conditions coupled with increased adoption of new technologies, such as the use of drones to effectively spray crops. pesticides.8
Three-quarters of the increase, or about 1 million metric tons, was contributed by expanding wet-season rice production, while a quarter was contributed by dry-season rice. Improved weather conditions helped to increase the cultivated and harvested areas of rice which expanded to 3.6 million hectares and 3.4 million hectares in 2021, respectively, from 3.4 million hectares and 3.2 million hectares in 2020, respectively.
In addition, increased adoption of new technologies and seeds has pushed wet and dry season rice yields to 3.5 metric tons per hectare and 4.5 metric tons per hectare in 2021, respectively, from 3. 3 metric tons and 4.4 metric tons in 2020, respectively.
The main agricultural products other than rice are rubber and cassava. In 2021, rubber production reached 0.4 million metric tons, an increase of 8.3%, while cassava production reached 14.7 million metric tons, an increase of 16.1% . Rubber and cassava ranked second and third in value and agricultural commodity exports, after rice.
Production and exports of mangoes and bananas are showing promising signs. Several fresh fruit products, including mango and yellow banana, are appearing. The yellow banana is now one of the most promising non-rice agricultural products, with exports rising to $168 million in 2021 from $112 million in 2020 (and $49 million in 2019).
In the first three months of 2022, exports of yellow bananas accelerated further, reaching $59 million. Mango products are also slowly emerging. Mango exports reached $10 million in 2021.
Rising ocean freight costs hit agricultural exports hard
Rising oil prices are hurting exports of agricultural products. Unlike electronics, clothing, travel goods and footwear, agricultural products are heavy and relatively cheap commodities, which are disproportionately affected by rising ocean freight costs due to supply chain disruptions of supply (shortage of empty containers), caused by the pandemic and the oil price shock, triggered by the war in Ukraine.
According to the Cambodian Rice Federation, trucking costs to major ports in Cambodia have recently increased by 10-20%. Freight costs are now unpredictable, depending on the volatility of oil prices.
Long-distance freight was particularly affected. Despite the end of trade safeguard measures imposed by the EU on Cambodian rice in January 20229, saving rice exporters €125 per metric ton, the high ocean freight rates, which have increased several times in recent years , will continue to hamper Cambodia’s rice exports to the EU market.
It is estimated that exports of agricultural products to distant markets such as the European market have decreased by 30%.
Likewise, the negative impacts of China’s zero COVID-19 policy are affecting exports of agricultural commodities other than rice, especially bananas and mangoes, which have just emerged as promising commodities.
The policy is hitting the hardest mango and banana products exported to China via Vietnam. The policy causes delays and traffic jams, resulting in spoiled and undelivered products. Direct exports via seaports to China are even more difficult.
Due to the increase in reefer container freight rates, fruit imported from Cambodia becomes less competitive with locally produced fruit in China, which discourages Chinese importers from importing fruit from Cambodia.
The oil price shock has started to affect agricultural production, as the prices of fertilizers and pesticides have increased. As a result, farmers have to increase the prices of their agricultural products, especially the prices of paddy rice, to compensate for the increases in input costs.
To cope with the shock of oil prices, some farmers are now turning to other crops that are more tolerant to climate change and pests, and to crops with high added value, in order to survive. world Bank