Linking smallholder producers to high-value markets through producer cooperatives : a case study of vegetable producer cooperatives in Cambodia : a thesis presented in partial fulfilment of the requirements for the degree of Master of AgriCommerce at Massey University, School of Agriculture and Environment, Palmerston North, New Zealand

Abstract

The emergence of supermarkets and high-value markets (HVMs) in developing countries has implications for producers and whole agri-food markets. To bring benefits of this development to smallholder producers, governments and development agencies have paid great attention to the essential roles of producer cooperatives (PCs). Many studies show that PCs succeeded in linking producers to HVMs, but numerous cases indicated that PCs did not achieve their goal. Modern retail markets and supermarkets have grown in Cambodia, but vegetable growers were unlikely to gain benefits from this HVMs. PCs play critical roles in assisting smallholder producers in strengthening market competition, but only a very few PCs achieved their business goals. The purpose of this research is 1) to examine the role of producer cooperatives (PCs) in linking vegetable producers to (HVMs) and 2) analyse the factors affecting successful participation in (HVMs).

This study applied mixed research methods by integrating qualitative and quantitative approaches to examine vegetable value chains, the roles of PCs, and factor affecting smallholder producers’ participation in HVMs. With this study, the primary data was collected by using a face-to-face interview with PCs’ managers and a survey interview with PCs’ members. This study used Qualitative Data Analysis, descriptive statistics, binary logistic regression, chi-square test, and independent samples T-Test to address research objectives.

The research indicated that the vegetable value chain in Cambodia consisted of two main marketing channels, such as traditional markets (TMs) and high-value markets (HVMs). The value chain of TMs was long and complicated with a number of chain actors, while the value chain of HVMs was short and high integration of the intermediaries. The research suggested that the value chain of HVMs provided a better price for producers, but volume supplied to supermarkets remains relatively small. In terms of the roles of PCs, all selected PCs provided agricultural input support, financial support, extension services, and market support to their members. However, PC-HVMs focused on both production and markets, while PC-TMs paid great attention to production. Based on these results, governments, and development agencies, and PCs should assist producers in both production technologies and business skills. The study examined factors that influenced smallholder producer groups’ participation in HVMs. The results indicate that the majority of respondents considered external factors, such as political, economic, social, environmental, and technological factors, as important factors affecting their participation in HVMs. This study suggested that wide ranges of supports provided to producers may help them to participate in HVMs. However, there is a need for favourite supporting policies and a macroeconomic environment from the government in the country. These could open up broader market opportunities for smallholder vegetable producers. The binary logistic regression results indicate that some internal factors, such as a vegetable farming experience, volume of vegetables, and average vegetable prices had a statistical significance with a positive sign. However, a vegetable farm size showed a negative sign.