Volume: 4 Issue 1 [January 2021]

Article:An Analysis of Pepper (Piper Nigrum) Value Chains in Cambodia

Author: Mr. Pisith SOK

Volume: Vol 4, Issue 1; January 2021

DOI: North American Academic Research, 4(1) 107-127, Jan 2021, https://doi.org/10.5281/zenodo.4459452

Abstract: Pepper is one of Cambodia’s main crop exports. It has been significant growth of production in hectares (ha) and metric tons (MT) and got GI status from EU markets but markets access and value adding of the produce remain a constraint for small growers, as Cambodian pepper heavily relies on Vietnam and Thailand markets particularly Tboung Khmum (TK) pepper. On the other hand, local processors still struggle with modern machineries to process pepper into other forms (ground pepper, oil, oleoresin or medicine) and high competition with Vietnamese collectors for buying peppercorns. By using SWOT analysis, quantitative and qualitative statistics, this study explores the dynamic market opportunities for pepper value chains (PVC) development in Cambodia to maximize value chains (VC) actors’ benefits and enabling business environment for investors. The study reveals that European (EU) markets, Japan, Korea, Taiwan, and the U.S are potential markets for Cambodian pepper exporting. Kampot (KP) pepper is identified as the taste of heritage and gets geographical indicator (GI) status from EU countries. Furthermore, contract farming (FC), (GI), and organic status are important factors for Cambodian pepper to target high value markets (premium price). By analysing SWOT tool shows that the strengths and opportunities are outweigh its weaknesses and threats particularly it is potential for investments and foreign direct investments (FDIs). The study found that challenges in the PVC such as limited planted areas (many small growers), shortage of processing techniques, lack of understanding market requirements, informal export to neighbouring countries (VN, TH), high interest rate of loans, and counterfeit on the name of Kampot pepper. To deal with these constraints, some solutions need to be addressed include expanding planted areas, improve productivity (KP pepper), enhance pepper quality (TK pepper), reduce dependency on Vietnam (grey market), more focus on end-user exporting markets, CF and organic status, strictly control licenses (GI & Organic), technology upgrading, diversify peppers, improve delivery system, and build brand equity. In addition, this research also found that peppers in Cambodia are potential for export oriented, investments, and reduce poverty. Finally, VC analysis tool plays a crucial role to identify all the factors and actors of the pepper industry in the country. Pepper is identified as the king of spices and one among the cash crop agricultural commodities of trade. It is valued as an ingredient for food cooking and as a spice. Cambodia is one of the largest pepper producers in South East Asia (SEA). Pepper is a climbing vine grown for its berries extensively used as spice and medicine. Pepper is considered the oldest agricultural commodity that is traded worldwide.

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