Entrepreneurs propel Kingdom’s cashew industry
AN EMERGING cashew nut powerhouse in Stung Treng province aims to export Cambodia’s authentic cashew flavour globally, in a bid to raise consumer awareness about the Kingdom’s high-quality nuts and boost the income of local farmers.
Despite Cambodia’s highquality cashew nuts earning a global second-place ranking currently, processing remains limited. However, with determined efforts to expand production, entrepreneurs like Muth Chakrya see a promising opportunity to enhance the local economy and elevate the international value of the Kingdom’s cashews.
Chakrya, the visionary behind Stung Treng Handcrafted Cashew Nuts at Sre Krasaing village in Siem Bok district, expresses her commitment to producing high-quality nuts for international markets. Since its establishment in October 2021 with a $20,000 investment, the business has remarkably grown its capital to nearly $1 million in just two years.
Through overseas presentations and product tastings for international guests, her enterprise has received taste approval from diverse countries, including Japan, the US, UK, Hong Kong, South Korea, Australia and the Netherlands. This positive reception showcases the potential for Cambodia’s cashews to make a significant mark on the global stage.
Chakrya shares that her products are currently available in small quantities in Japan. She plans to ramp up exports in 2024, aiming for around 6,000 tonnes to reach markets in across Asia and Europe.
“We’ve begun exporting to Japan, but our sales volume is modest since it’s a recent venture. This December, we’re expanding exports to Hong Kong with a decent quantity. Looking ahead to 2024, we plan to reach China and the Netherlands. As for the US market, we’re in the process of setting up a warehouse,” she says.
Cashew dreams
Currently, Cambodia has only a handful of cashew nut processors, unable to keep up with market demand. It’s therefore crucial for investors to contribute more to this sector, boosting processing capabilities significantly.
“There’s a substantial demand for cashews in the market. However, Cambodia faces challenges – firstly, a shortage of technical expertise for production. Secondly, the lack of investment capital is a hurdle since cashew processing requires technology and significant investment. Without these, it’s a challenging endeavour,” explains Chakrya.
Soeun Sothnita, Chakrya’s business partner, shares that the increased cashew production for both local and international markets is geared towards preserving the identity of Cambodian cashew nuts. The goal is to avoid exporting them as raw, unprocessed nuts. Simultaneously, this initiative aims to generate employment opportunities and income for local communities.
“In the past, people used to seek employment outside the country. However, with the establishment of this emerging sector, individuals now find work here to earn a monthly income. They no longer need to engage in labour-intensive cassava cultivation, which comes with various challenges and consumes a considerable amount of time. Additionally, they gain additional knowledge in processing, production, hygiene standards, environmental awareness as well as computer and driving skills,” she explains.
In Kampong Thom province, In Lai Huot, the owner of Chey Sambo Cashew Nut Processing Handicraft, shares that since partnering with her Japanese counterparts between 2020 and 2023, they have exported approximately 70 tonnes of products to the Japanese market and supplied around 30 tonnes domestically.
Looking ahead to 2024, Lai Huot reveals plans to enlarge the facility, exceeding its previous size, with a goal to export 1,500 tonnes. Simultaneously, there are plans to produce for the domestic market, which makes up 70 per cent of their focus. This pause in exports in 2023 is due to the ongoing process of obtaining a new standard certification, a requirement to be fulfilled annually.
Harvest confidence
“In 2024, our goal is to boost and expand our facility, targeting a daily production capacity of three tonnes to cater to the needs of both domestic and international markets. Currently,
our capabilities are restricted by the limited size of our current location and insufficient budget,” Lai Huot says.
In gathering cashew nuts for processing, she is confident in collecting a quantity that meets standards, drawing on her firsthand experience with the local farming community.
As a female entrepreneur, Lai Huot takes pride in creating job opportunities for the locals and introducing cashew products from Cambodian farmers to the international market. Her vision extends beyond Japan, aiming to expand sales to the EU, ASEAN and South Korea.
“I’m keen on further expansion, committed to creating more jobs for the local community. Our plan involves partnering with small processing groups to collectively access the international market,” she says.
Ly Kim Suy, owner of a cashew plantation in Tipor commune’s Nimith village in Kampong Thom province’s Santuk district, believes that expanding cashew nut production and processing in the country brings several benefits. Firstly, increased processing facilities offer farmers better opportunities to sell their nuts. Secondly, processing cashews to meet proper standards enhances their value, contributing to the recognition of Cambodian cashews in the international market.
As a cashew farmer, Suy desires domestic cashew processing factories. Despite no current shortage of markets, he remains determined to supply nuts to local factories. This approach is seen as more straightforward and precise compared to dealing with middlemen buyers.
“I have a 19ha cashew plantation. For those with the means, establishing a local cashew processing factory is a viable option. I lean towards selling directly to processing facilities rather than dealing with middlemen buyers,” he says.
Optimism running high
Suy Kokthean, vice-president of the Cashew nut Association of Cambodia (CAC), notes an increasing interest from individuals in investing in cashews. They actively seek information, scheduling appointments with the association. This trend indicates a promising surge in local investors entering the cashew processing industry, he says.
According to Kokthean, Cambodia has the potential to be the “cashew emperor”.
“The Kingdom boasts the world’s finest cashews, unmatched in quality and setting them apart from those produced by any other nation.
“I’m truly optimistic about the exceptional quality of Cambodian cashew nuts, which stands unparalleled worldwide. Our primary focus is to process these high-quality products to ensure they gain global recognition,” he says.
He also notes that currently, investment capital in the cashew sector in no longer a concern. The government, in collaboration with state-owned Agricultural and Rural Development Bank (ARDB) and Small and Medium Enterprise
Bank of Cambodia (SME Bank), has allocated a budget package for the sector. Moreover, the Ministry of Agriculture, Forestry and Fisheries has earmarked approximately $100 million to enhance agriculture, with substantial contributions from development partners supporting this sector.
“We aim to make sure our farmers understand the importance of Cambodia producing the world’s best cashew nuts, and our processors grasp this significance too,” he says.
Agriculture ministry spokesperson Im Rachna notes the vast potential for cashew cultivation in Cambodia. Presently, around 700,000ha are utilised, yielding approximately one million tonnes per year, which are primarily exported to Vietnam.
She also notes that while the nation boasts an ample supply of cashews for both export and domestic use, the hurdle lies in the insufficient number of producers meeting the necessary quality standards for export.
“We aim to improve processing, keeping the entire supply chain within our country. Ideally, we want to produce and process one million tonnes domestically. Furthermore, we’re exploring the possibility of importing, processing and exporting abroad,” says Rachna.
She observes that investors have been cautious about entering this sector due to the uneven supply of nuts from farmers. As a solution in this new mandate, the ministry is creating a modern agricultural community that links growers, collectors and processing enterprises.