Agri buddy, a Japanese-owned start-up, is the first agricultural facilitator working with the entire production chain in the Kingdom’s agricultural sector.

Launched in 2015 with $730,000 in venture capital funding, the Siem-Reap-based “agritech” company currently provides services to 20 districts comprising some 300 villages and reaches more than 50,000 farmers as Agri buddy members.

Agri buddy managing director Yourng Pakk sat down with The Post’s Cheng Sokhorng to discuss how the company provides agricultural services to deal with challenges in the sector.

Why did Agri buddy enter the Kingdom’s agricultural sector?

Cambodia has great potential in its agricultural sector as it has vast prospective cultivation areas in its fertile lands, which are suitable for cultivating a wide range of crops such as rice, corn, rubber and cassava. But one of the problems we see is farmers’ misuse of loans. This poses a challenge to the financial institutions that provide them loans, as they lack the strategies to properly track whether farmers use them resourcefully.

It produces high risks, and farmers themselves can give up farming when their yields are not up to their expectations.

Agri buddy wants to provide a solution to the problem through comprehensive services for agricultural production, helping farmers properly allocate their loans within their resources and technological limitations, and access the market.

We also support financial institutions as a facilitator. We help suppliers of agricultural input and agricultural service providers to assist processing companies such as rice millers.

As a facilitator, what have you done to build trust in the sector?

Agri buddy operates as a facilitator for the entire agricultural production chain to increase productivity, quality and efficiency in processing.

We select a farmer leader in each village where we base operations and dub them a ‘buddy’. We then provide them with training on managing farmers and facilitating farming processes. We also work with financial institutions which provide loans to farmers by ensuring the farmers use the loans effectively.

We cooperate with the purveyors of agricultural inputs and services – such as fertiliser, seed and agricultural service providers, as well as land ploughing, harvesting and transport services – to ensure the quality of said products and supplies.

We also work with agricultural product buyers, such as rice millers, by ensuring the quantity and quality of our farmers’ produce, so that they are likely to buy more from them to process and supply the domestic market and export.

Furthermore, we provide legal services to assist all stakeholders in ensuring that everyone respects their contracts and responsibilities within our agricultural insurance services, and ensure that even if farmers see limited yields due to droughts or floods, they will receive payment which can be used to cover cultivation costs. Doing this, they can avoid being indebted to financial institutions.

Which provinces do you currently operate in?

We are operating in six provinces – Kampong Thom, Siem Reap, Banteay Meanchey, Pailin, Battambang and Pursat – where we provide agricultural services and focus on three main crops – paddy rice, cassava and corn.

There are more than 50,000 farmers who have registered as members of Agri buddy and more than 8,000 families have subscribed to our services. We have disbursed $2.5 million to more than 3,000 families.

What are the challenges your company and farmers currently face?

The main challenge we are currently experiencing is farmer and partner confidence. This is because we have just begun to be fully operational.

The service we offer is the first ever instance of this new business model, so we still need time to build up the market and trust. We need to work more with farmers, agricultural suppliers and processors to increase their trust as well as their benefits.

Another challenge for farmers is the capital, the technology and the market necessary for their agricultural products, as well as irrigation systems that do not supply enough water to farmers for their crops. Then there’s the cost of production and processing – such as agricultural inputs, irrigation costs and electricity costs for processors.

All of this makes our products costly when compared to imports. So it is difficult for us to compete in the market and it impacts agricultural growth.

This interview has been edited for length and clarity.