Toward Deforestation Free Agriculture: Recommendations for a sustainable cashew value chain in Stung Treng Province, Cambodia

Insights from the Participatory Value Chain Assessment of key-forest-risk commodities in Stung Treng province, Cambodia

July 8, 2025

Agriculture continues to play a vital role in livelihood across the northeastern province of Stung Treng, yet it has also emerged as a major contributor to deforestation and environmental degradation. The expansion of farmland, particularly for crop like cashew has driven forest loss, undermining biodiversity, degrading soil health, and threatening the region’s long-term agricultural productivity.

As global demand for cashew grows, many cashew farmers are expanding cashew cultivation to access new market. However, unsustainable expansion—such as clearing forest land or converting sensitive ecosystem areas—contributes to deforestation, biodiversity loss, and greater climate vulnerability. Without adequate information or incentives, farmers often don’t realize the long-term environmental and economic risks this poses.

Climate change is also making cashew farming increasingly challenging. Rising temperatures, erratic rainfall, prolonged droughts and longer cool season are delaying harvests, reducing yields, and lowering nut quality—particularly affecting the kernel outturn ratio and resulting in higher rates of defective or poor-quality nuts. In 2022, climate related impact caused a 20% drop in national cashew production, according to Mr. Sophal Laikong, Acting Executive Director of the Cambodia Cashew Federation (CCF). Most farmers lack the knowledge and resources to adapt, created a cycle of climate stress reducing yields, prompting farmers to clear more forest land and rely on agrochemicals, which further degrades the environment. Without urgent investment in sustainable practices and climate resilience, the future of cashew farming and the ecosystem it depends on is at risk.

As part of the FAO-UNDP Scaling up Climate Ambition on Land Use and Agriculture (SCALA) programme, UNDP Cambodia and the Royal University of Agriculture (RUA) are working to strengthen the evidence base for promoting deforestation-free commodities through a participatory value chain assessment in Stung Treng province. On 19–20 March 2025, RUA convened a “Provincial Consultative Workshop” with over 60 stakeholders—including farmers, processors, government officials, financial institutions, academia and private sector representatives—to share insights and identify opportunities for promoting forest-positive practices; and enhance collaboration across sectors.

To better understand how to promote sustainable, deforestation-free practices in Cambodia’s cashew sector, we spoke with four key stakeholders representing different parts of the value chain: the Acting Executive Director of the Cambodia Cashew Federation (CCF), the Chairperson of an Agricultural Cooperative in Seambok District, an agricultural input supplier, and a representative from the Agricultural and Rural Development Bank (ARDB).

Drawing on the insights and experiences they shared during the workshop, we present three key recommendations to strengthen private sector engagement and foster collaboration with public institutions and local communities to advance forest-positive agriculture while improving farmer livelihoods

1. Promote regenerative agriculture practices and climate-smart farming

Rising temperatures and shifting weather patterns are already impacting cashew production in Cambodia, with yields dropping by 20% in 2022. Many farmers lack the knowledge and resources to adapt to these changes. During the workshop, participants highlighted simple, scalable practices such as planting cover crops to enrich soil and reduce erosion, as practical ways to enhance climate resilience in the cashew sector.

“I’ve learned the value of growing cover crops—not just to improve productivity, but to protect soil health in the long term,” shared Mr. Ky Kosal, Chairperson of an Agricultural Cooperative in Seambok District, Stung Treng.

Regenerative agricultural practices such as intercropping and beekeeping offer promising opportunities to diversify farmer incomes while supporting ecosystem health. However, adopting these approaches will require target training, demonstration plots, and coordinated support from both public institutions and private sector actors involved in input supply.

“One of the key takeaways from this workshop is the concept of deforestation-free commodities—farming that doesn’t expand into forests but still maintains high productivity for farmers. This aligns well with the global trend and the vision of the Cambodia Cashew Federation,” said Mr. Sophal Laikong, Acting Executive Director of the CCF.

2. Use digital tools to share trusted information with farmers

Misinformation and limited awareness of best farming practices remain major challenges. Many farmers unknowingly purchase counterfeit agricultural inputs online, leading to wasted money and damaging their crops.

“Some farmers are scammed into buying fake fertilizers online. We need better access to reliable information,” said Ms. Yos Sothida, an agricultural input supplier in Stung Treng province.

She suggests that trusted institutions—like local government offices, universities, and NGOs—collaborate to develop and share verified agricultural content and distribute it via social media, messaging platforms, and farmer networks. Digital tools can help build trust, raise awareness of sustainable practices, and counter misinformation at scale.

3. Invest in post-harvest and processing capacity through green finance

Cambodia’s cashew sector faces a major constraint due to limited local processing capacity. Most cashews are exported raw, reducing both profit margins and domestic job creation. To build a more robust and competitive value chain, increased private sector investment is needed in processing facilities, traceability systems, and contract farming models.

“There is growing opportunity for private sector engagement, especially in cashew processing. While local capacity is still limited, collaboration with international processors—like those in Vietnam—could help bridge the gap,” noted Mr. Laikong of CCF.

Financial institutions also play a critical role in supporting sustainable agriculture. The Agricultural and Rural Development Bank (ARDB) is already providing green loans to farmers and cooperatives—on the condition that they comply with environmental safeguards.

“ARDB offers financing to farmers who protect the environment and avoid deforestation. This is how we support sustainable growth in the sector,” said Mr. Piech Bora, Senior Officer of Green Loan Underwriting and Portfolio Management Division at ARDB.

Looking ahead

Building a deforestation-free cashew value chain in Cambodia is a shared responsibility that requires coordinated action. It requires close collaboration among farmers, government agencies, buyers, processors, and financial institutions. As Mr. Laikong emphasized:

“The private sector alone cannot achieve this milestone. We need support from the public sector, especially local authorities, to work hand in hand with farmers on the ground.”

The SCALA programme’s participatory value chain assessment and consultative workshop are laying the foundation for inclusive, evidence-based planning. By integrating sustainability across every stage of the value chain—from input supply to financing and processing—Cambodia has the opportunity to position itself as a global leader in deforestation-free, climate-resilient cashew production.