IJERD – International Journal of Environmental and Rural Development (2022) 13-1

Research article
erdIncome Generation and Expenditure of Organic Rice
Farming Households: Case Study of Preah Vihear Province,Cambodia
CHANMONY SOK*
Graduate School of Agriculture, Tokyo University of Agriculture, Japan
Email: Chanmony0223@gmail.com

TOMOHIRO UCHIYAMA
Faculty of International Agriculture and Food Studies, Tokyo University of Agriculture, Japan

NINA N. SHIMOGUCHI
Faculty of International Agriculture and Food Studies, Tokyo University of Agriculture, Japan
Received 31 January 2022

Accepted 22 April 2022(*Corresponding Author)

Abstract In Cambodia, organic rice farmers commonly engage in integrated farming andoff-farm activities to supplement their income. To identify factors for income optimization,
this study attempted to assess the income and expenditure structure of organic rice farmhouseholds in the Preah Vihear Province, Cambodia. Guided with a structured
questionnaire, a total of 90 and 50 randomly selected farmers were interviewed in 2019 and2021, respectively. This study utilized both descriptive and multiple regression analyses.
Overall, farmers tended to expand their cultivation area and increase income from off-farmjobs. Particularly, large-scale farmers (5ha<) significantly expanded their farmland area andincreased their livestock and off-farm activities, while small-scale farmers (5ha>) reduced
their farmland area and increased their off-farm activities. Moreover, the multiple
regression analysis revealed that secured spare time from combine-harvester usage opened
opportunities for farmers to engage in off-farm jobs. These off-farm jobs, particularly by
male farmers, boosted their respective annual income. On the other hand, existing loans
gave several farmer respondents negative profit in 2020. Thus financial management
seemed to be a factor affecting farmers’ incomes in rural areas. For further study, farmhousehold employment choice behavior, particularly on labor mobility and off-farmactivities, is recommended.
Keywords expenditure, income, off-farm activities, organic rice, rural area

INTRODUCTION
Agricultural development is the most effective way to reduce poverty (World Bank, 2008). Twoeffective agricultural development strategies are commonly practiced: engaging in organic
agriculture and growing energy crops (Markandya and Setboonsarng, 2015). In Cambodia,
agriculture contributed to poverty reduction from 50% in 2007 to 9.4% in 2017. Moreover, rice isthe predominant crop, occupying 80% of the total crop area, and about 90% of the poor live in rural
areas and rely on rice farming for their primary income sources (NIS, 2013). The agriculture sector
still shared around 20% of GDP in 2019 (MAFF Cambodia, 2020). However, evidence suggeststhat rural households' livelihoods draw on various activities in developing countries. From ruraldevelopment and food security viewpoints, it is critical to understand the structure of farmhouseholds' earnings and income levels (Helmers et al., 2004; Tong and Phay, 2013). Located in
the Northern part of the country, Preah Vihear province is one of the main producing area oforganic rice in Cambodia. This rural province produces organic rice once a year. Thus, all farmers
have off-farm activities and produce other crop to support their daily lives. Commonly, farmers
produce rice, other crops, and livestock (e.g. cattle, poultry), and do other off-farm activities asⒸ ISERD56

IJERD – International Journal of Environmental and Rural Development (2022) 13-1

wage-earners and migrants to the city or neighboring country to do other jobs to maximize theirincomes (Preah Vihear Provincial Department of Agriculture, 2019). Little research has been
performed on organic farm households' expenditure and income generation, especially in ruralareas (Uddin and Takeya, 2006). However, no researcher has measured the expenditure and income
generation of organic rice farm households in integrated farming based on-farm size and family
structures (e.g. gender, age, family member, and off-farm activities) in Cambodia.
OBJECTIVE
This study aims to assess the income and expenditure structure of organic rice farm households in
the Preah Vihear province, Cambodia, to determine the most suitable choice for organic rice farmhouseholds to maximizing income. Specifically, this study aims to identify the characteristic oforganic rice farm households in the study area; clarify the structure of income sources of farmhouseholds; and assess their expenditures.
METHODOLOGY
Study area: Data collection was conducted in Preah Vihear province, the largest organic riceproducing area and largest contract farming area in Cambodia. This region was characterized as arural area, with 85% of the population (approximately 60,605 households in 2019) relying onagriculture. Hence, farmers were the main actors in this rural area.
Sample selection: Questionnaire survey and in-depth interviews were conducted randomly of 50
organic rice farmers in contract farming during the fields survey 2021. Collected data wereprocessed and compared with the previous field survey of 90 respondents in 2019 in the same study
area. Qualitative data were also collected regarding constraints, opportunities, and other impact
factors, including environmental and social factors.
Data analysis: Descriptive and multi-regression analyses were utilized. The multiple-regression
model below was adopted from Uddin and Takeya (2006) study.
Ln AI = ln a + b1 ln X1+ b2ln X2 + b3ln X3 + b4ln X4+ b5ln X5+ b6ln X6 + b7ln X7 + b8ln X8 +Ui
Ln = Natural logarithm
Y = Annual income of farm householda = Constant or intercept of function
X1 = Total owned land
X2 = Working days per year on farm activities by male
X3 = Working days per year on farm activities by female
X4 = Working days per year off-farm activities by male
X5 = Working days per year off-farm activities by female

X6 = Family member
X7 = Family member engage in Agri.
X8 = Age of head household
b1…b8 = Coefficients of respective
variables;
Ui= Error terms.

RESULTS AND DISCUSSION
Farmer respondents were divided into three groups according to their owned land size, as shown in
Table1. Family members and members engaged in agriculture decreased yearly, for overall farmers
and or group categories. From 2018 to 2020, farmers seemed to increase their cultivation areas.
However, only farmers who own land more than 5 ha increased their cultivation areas, and farmers
who own land larger than 10 ha expanded all their cultivation areas in a fast pace. In contrast,
farmers who own land less than 5 ha seemed to decrease their rice cultivation. From fieldobservation, farmers tend to operate inherited land and sell some of their land. They were more
involved in off-farm activities than on-farm activities.
Table 2 shows income sources and expenditure of farmer respondents in the study area. The
main job of farmer respondents are organic rice farming. However, since organic rice could only be
produced once a year, farmers need to do other jobs to increase their annual incomes as shown inⒸ ISERD57

IJERD – International Journal of Environmental and Rural Development (2022) 13-1

Table 2, such as other crops farming (cassava, cashew nut), vegetable farming, livestock, and offfarm jobs (e.g. wage earner from other farm, construction workers, small grocery owner,
government officer). From Table 2, income from rice farming remained high, but income from offfarm jobs farmers are increasing annually. In general, farmers had lower incomes in 2020 except
for those who owned less than 5 ha. Farmers who owned land more than 5 ha relied more onorganic rice farming compared to other farmers, thus the impact of natural disasters was also high.
At the same time, farmers are also increasing income from livestock, and other crop farming,
Farmers who own larger than 10 ha increased their livestock farming income in a fast pace. Fromthe interview, farmers said that even though the use of agricultural machinery is still limited, either
owned or rented, and it has secured them more time to do off-farm jobs or expand their cultivatedland.
Table 1 General characteristic of farmers respondents from 2018 to 2020

Table 2 Income sources and expenditure of farmers by year and groups
unit: thousand riels/household

All the essential daily or monthly expenditures of farm households are included in Table 2
except the production cost of farming. More than 50% of total expenses accounted for foodconsumption. Farmers are also willing to invest more in their children's education, about 15% oftotal expenses, and more than 15% for farmers with land larger than 10 ha in 2020. Moreover, theannual loan tends to increases because farmers are more engaged with loans to increase cultivatedland or other purposes, and farmers who own larger than 5ha are more involved with the loan.
Farmers mainly borrowed from banks, micro-finance, and a small amount of money fromagricultural cooperatives, with the monthly interest rates ranging from 1.75% to 2.5%. In addition,phone payment is increasing because recently, farmers have recently started to use smartphones toreceive more information. Lastly, other expenses in Table 2 included health care, social/religious
ceremonies, and house repair. As shown in Table 2, farmers could not sufficiently save in 2020,and from observation, several farmers lost their profit in 2020, which will be further discussed inTable 3.
Ⓒ ISERD

58

IJERD – International Journal of Environmental and Rural Development (2022) 13-1Fig. 1 Percentage of income sources by farmer groups
Source: Field survey in 2019 and 2021Table 3 Income sources and expenditure of farm households who lost profit in 2020
unit: thousand riels/household

Although most farmers reported that the main job is rice farming, Figure 1 clearly shows anatural shift of farmer income sources to off-farm activities. Moreover, only farmers who own landless than 5 ha rapidly increase off-farm jobs and decrease share income and cultivated rice farming
land from 2018 to 2020. This can be attributed to farmers selling of inherited rice cultivated land.
In addition, farmers who own land 5 to 10 ha are increasing off-farm, and other crops farming andfarmers who own land larger than 10 ha are more increasing in livestock because they have larger
land and capital.
During the field survey in 2021, some farmers had no profit due to high expenses, as shown intable 3. All those farmers spent more on paying loan interests, while the income in 2020 decreased.
From field observation, farmers who owned land between 5 to 10 ha engaged more in loans toexpand their land cultivation and other activities. Unfortunately, the rice yield was low, whichdecreased income, and farmers could not afford the repayment. In addition, some farmers whoowned less than 5 ha needed to sell their lands to afford the repayment to the bank, which madefarmers decrease their owned land, while those who owned land of more than 5ha sold theirlivestock and other machinery to repay the loan. Those problems made these farmers further
smaller in scale. Therefore, farmers seemed to need to understand more about financial
management to lower risk in the future.
Table 4 shows the result of multiple-regression on total annual income with working labors,family members, and age of farm households in 2020 by dividing into two groups: farmers whoowned less than 5ha and a combination of all farmers who owned land larger than 5ha. It should be
noted that the farmers who owned more than 10 ha were not grouped separately due to smallⒸ ISERD59

IJERD – International Journal of Environmental and Rural Development (2022) 13-1

sample size of nine respondents. As a result, besides the land size, off-farm activities significant
increased the total annual income. Working off-farm jobs for male has boosted their annual income,
especially farmers who owned less than 5 ha. On the other hand, working on the farm for females
resulted to negative impact because female farmers are only good at transplanting and harvesting.
During land preparation, most female families go together to cook for their husbands or family
members at the fields and do side-works nearby, such as picking some dead trees. On-farm work ofmales is much better during land preparation and other works. Besides that, family members,
members engage in agriculture, and the age of the head of households are not significant toincrease the income.
Table 4 Multiple-regression of model of farm households’ incomes based on groups< 5 ha (2020) (20 respondents)(Intercept)
Land size
Working on-farm male
Working on-farm female
Working off-farm male
Working off-farm female
Family members
Family members engage in farming
Age

Estimate
11.2140.612
0.139-0.073
0.330
0.292
0.227
0.190
0.145

Std. error
1.483
0.345
0.094
0.137
0.136
0.236
0.238
0.272
0.350

t-value
7.558
3.724
1.462-1.534
2.422
2.082
0.942
1.991
0.416

Pr (>|t|)
0.000
0.011
0.171
0.303
0.032
0.064
0.360
0.116
0.580

Std. error
3.191
0.253
0.270
0.281
0.073
0.060
0.230
0.130
0.132

t-value
4.627
5.221
2.051
-1.954
2.815
1.739
0.396
1.080
0.603

Pr (>|t|)
0.000
0.000
0.053
0.064
0.010
0.097
0.696
0.292
0.553

***
*

*
*

Signif. codes: 0 ‘***’ 0.001 ‘**’ 0.01 ‘*’ 0.05 ‘.’ 0.1 ‘ ’ 1Multiple R-squared: 0.6657, Adjusted R-squared: 0.5247> 5ha (2020) (30 respondents)(Intercept)
Land size
Working on-farm male
Working on-farm female
Working off-farm male
Working off-farm female
Family member
Family member engage in farming
Age

Estimate
14.7661.324
0.554-0.550
0.208
0.105
0.091
0.140
0.079

***
***.
.
*.

Signif. codes: 0 ‘***’ 0.001 ‘**’ 0.01 ‘*’ 0.05 ‘.’ 0.1 ‘ ’ 1Multiple R-squared: 0.742, Adjusted R-squared: 0.640
Source: Field survey in 2021

Table 5 Total annual income and labors input by group in 2020

Income sources(Thousand riels/HH)

Labors input(People/HH)

Items
Number of households
Rice
Other crops
Off-farm
Vegetable
LivestockTotal income
Total labors
Rice (male)
Rice (female)
Other crops (male)
Other crops (female)Off-farm (male)Off-farm (female)
Source: Field surveys in 2021

Overall
50%
4,300
35
1,739
14
6,389
51
637
5
2,884
23
12,429
100
436
100
47
11
49
11
21
519
4201
46
101
23

Less than 5 ha
20%
2,312
17869
67,97758
517
42,165
16
13,840
100
462
100
33
734
7
102102231
50
143
31Ⓒ ISERD

60

5 to 10 ha
21%
4,316
31
1,906
144,70534
772
62,31617
14,015
100
366
100
51
1452
14
21
621
6159
44
61
17

More than 10 ha
5%
9,477
33
3,585
12
6,645
23
600
28,48929
28,796
100
550
100
74
13
79
14
44
8
36
7227
41
91
16
1 USD = 4,050 riels

IJERD – International Journal of Environmental and Rural Development (2022) 13-1

Even the regression analysis showed that farmers could boost their annual incomes byengaging in off-farm activities in the current situation, farmers who used about 22% of total labor
inputs on rice farming only received about 35% of total income (Table 5). On the other hand,
farmers who used about 70% of total labor on off-farm activities received about 51% of total
income. This conveys that farmer may achieve more labor and income efficiencies by organic rice
farming. However, seasonality of organic rice farming and difficulty in expanding land for organic
rice cultivation (mainly small-scale farmers) are the core reasons on further shifting to off-farmactivities.
CONCLUSION
In general, the cultivation area has been increasing from 2018 to 2020. Farmers who own land
more than 5 to 10 ha increased all the cultivated lands, especially on other crops. However, farmers
who own less than 5 ha seemed to rapidly increase their off-farm jobs and decrease their rice land.
Regarding expenditure, farmers spent more than 50% of total expenses on their foodconsumption, followed by 15% spendings on their children’s education. This trend is prevalent tofarmers are currently more engaged in loans. Unfortunately, several farmers (especially farmers
who owned land less than 5ha) could not repay the loan in 2020, forcing them to sell their lands orother properties to repay the loan and making small-scale farmers further smaller in scale.
However, rice farming still seemed to offer opportunities for farmers to boost their annual
incomes in terms of labor inputs and incomes if farmers could expand their rice land and do proper
financial management.
Nevertheless, instead of expanding rice cultivation, farmers (especially farmers who owned
less than 5ha) tend to increase their annual income by engaging in off-farm jobs in the current
situation. On the other hand, farmers who owned less than 5 ha are better off in securing morespare time to do off-farm jobs, especially males, have more potential to boost the farm households'
annual incomes.
Therefore, farm households' employment choice behavior, particularly labor mobility, offfarm activities, and loans, is recommended for further study to find more solutions for maximizing
the farm households’ income.
ACKNOWLEDGEMENT
The authors wish to extend sincere appreciation to Research Institute for Agricultural and Life
Sciences (RIALS) for partially supporting this research.
REFERENCES
Helmers, K., John, G. and Pia, W. 2004. Final report of the rural sources of income and livelihood strategies
study. Memo, World Bank.
Markandya, A. and Setboonsarng, S. 2015. Organic crops or energy crops? Option for rural development inCambodia and the rao people's democratic republic. ADB Institute Discussion Paper, 101.
Ministry of Agriculture, Forestry and Fisheries (MAFF). 2020. Annual report of agriculture, forestry, andfisheries 2019-2020. Ministry of Agriculture, Forestry and Fisheries, Phnom Penh, Cambodia.
National Institute of Statistic (NIS). 2013. Cambodia socioeconomic survey 2013. National Institute ofStatistic, Cambodia, 23-28.
Preah Vihear Provincial Department of Agriculture. 2019. Annual report for agriculture, forestry, andfisheries 2018-2019. Provincial Department of Agriculture, Preah Vihear Province.
Tong, K. and Phay, S. 2013. The role of income diversification during the global financial Crisis: Evidence
from nine villages in Cambodia. Working Paper Series, 78.
Uddin, T.M. and Takeya, H. 2006. Employment patterns and income generation of farm households in
integrated farming of Bangladesh. International Journal of Agricultural Research, 1 (1), 32-40.
World Bank. 2008. World development report 2008: Agriculture for development. World Bank, 28-29.
Retrived from https://openknowledge.worldbank.org/handle/10986/5990Ⓒ ISERD61