Sean Kiely travels to Battambang, Cambodia to conduct research on risk and risk management strategies for smallholder vegetable farmers
By Sean Kiely
The research I conducted in Battambang, Cambodia focused on risk and risk management strategies for smallholder vegetable farmers. With the support of the Jastro Research Award, as well as supporting funds from the Research and Innovation Fellowship for Agriculture and the Blum Center for Developing Economies PASS grant, I was able to conduct this research over a four month period in the fall of 2017.
My research consisted of creating and administering an 1) an economic analysis of vegetable production and 2) a questionnaire on risks and risk management for 40 smallholder farmers in 3 villages outside of the cities of Battambang and Phnom Penh. The economic analysis captured the inputs and outputs of vegetable production on a farm. These are 1) the start-up and annual costs of production, broken down into labor and inputs with their per unit prices, and 2) the annual benefits of production. These inputs and outputs will give an economic analysis of the farm which can be carried out over a 10 year period of time. Using key output variables such as net present value, returns to land, and returns to labor, we can assess the economic benefits of vegetable production over time. I plan to do this for each farm's vegetable production area and then aggregate the results into an average of all the farms. This will establish a baseline land-use system.
The risk and risk management questionnaire assesses 1) attitudinal levels of risks faced on the farm 2) perceptions of risk taking ability 3) use, understanding, awareness, confidence, interest, and perceived benefits and risks of both traditional and alternative risk management strategies and 4) access to risk information and education. I will then incorporate the alternative risk management strategies that are not currently used, or very limited in their current use, such as contract farming, crop insurance, inventory credit systems, and producer groups and savings groups as "tweaks" to the economic baseline system and assess their individual impacts and appropriately combined impacts on the key output variables over time. Finally, I will combine the questionnaire and economic analysis through statistical analysis by ranking the alternative risk management strategies by risk. Through this, I will determine which risk management practices will have the greatest economic impact and will be most likely to be adopted by farmers. This research aims to reduce the economic shocks that smallholder farmers face on a seasonal basis and annual basis, reduce economic constraints, and work toward the alleviation of poverty in the area.