Increasing Smallholder Access, Availability, and Utilization of Agro-Inputs in Cambodia
This paper highlights the challenges faced by smallholder farmers in procuring modern agro-inputs in Cambodia. It presents solutions to these challenges and examines the Fintrac-implemented approach to stimulate private sector input supply and demand at the smallholder level. The Fintrac approach employs a co-investment model both at the farm and enterprise levels to demonstrate success, reduce risks of upgrading, and stimulate demand in the private market. The paper suggests that poor farmers in Cambodia need longer term financial and technical support if rural services are to be sustained. It also finds that if farmers do not possess the knowledge to utilize improved farm inputs to maximize their potential, they are unlikely to invest scarce financial resources on a continual basis, thereby dampening potential demand. Key findings include:
- Farmers and input suppliers are risk averse and often require initial intensive technical and financial support to demonstrate success from upgrading practices;
- Farm and enterprise co-investment model stimulates rural input access, availability, and utilization;
- Demand for inputs creates commercial incentives for agribusinesses to embed services in their offerings, including extension, and credit that build customer loyalty;
- Tangible financial returns at the enterprise level increases competition and supply, driving rural input prices down.