Farming Smarter in Lao PDR | Asian Development Bank

Farming Smarter in Lao PDR

Article | 17 November 2010

Aided by investments in skill transfers, irrigation, and road upgrades, villagers in the Lao highlands now have the knowledge to improve their farming and marketing techniques, connecting them to markets as far away as Japan.

Pak Xong - Signs of modernity have come to these hardscrabble hills in southern Lao People's Democratic Republic (Lao PDR). Satellite dishes peek out from behind stilted homes. The chirp of mobile phones breaks the quiet as farmers take calls from traders provinces away.

Just a decade ago, life here was more difficult. Families ate what they could grow and little else. Agriculture was primitive. More than two-thirds of farms lacked any type of mechanized equipment.

"These people were once perceived as uncivilized," said Lam Ngeunh Phakaysone, an official with Lao PDR's Ministry of Agriculture and Forestry. "Not any more. People from outside are actually coming here for work. Some of these farmers are bosses now."

Much of this is owed to the Smallholder Development Project, funded by a $15.2 million ADB loan, to modernize farming techniques in conjunction with the government. Since 2006, farmers have gained the skills and know-how to grow niche products that fetch desirable prices abroad: organic cabbages shipped to Thailand and high-quality coffee exported to Japan.

An estimated 40,000 households have seen their incomes rise. Among them is the family of farmer Phao Keopaseuth, whose wife and seven children often went hungry.

"All of us used to live in a little hut made from bamboo," Phao said. "We shared a little field with relatives, but it wasn't enough. We were starving."

The family now lives in a home overlooking several hectares of cabbage fields. Irrigation and a second-hand tractor have increased yields dramatically for this family and others in the region. Pak Xong village once produced only about 200 tons of cabbages per year. The average is now roughly 2,500 tons per year, according to village leaders.

Beyond basic farming modernization, the project has linked these remote highlands to larger markets outside Lao PDR. Improved all-weather roads now connect locals to newly built markets on the Thai-Lao border, where traders buy produce in bulk. Farmers have learned basic market economics and techniques to negotiate with faraway buyers using text messaging.

"Cell phones used to be a luxury item," Lam Ngeunh said. "Now they use them to stay in touch. If an order for cabbage comes, they can harvest it and have it on the road in 24 hours."

Promoting Lao Crops Abroad

Coffee, not cabbage, is perhaps the greatest hope of this region. As early as the 1920s, French colonialists recognized the value of the region's volcanic soils and high-altitude for coffee growth.

But coffee grown here has never enjoyed the branding power of Vietnamese or Indonesian beans, which are coveted around the world. Farming practices were so poor, and access to outside markets was so weak, that the coffee's regional selling price sank to less than $0.15 per kilogram in 2001.

"Before, the quality was rather bad," said Somboun Saiborkeo, a coffee farmer in Pak Xong. "We had so little. We were walking 5 kilometers, heavy sacks on our backs, just to get to our communal gardens. "Desperate, many of his fellow farmers abandoned their coffee fields altogether.

Through training, farmers have learned to rotate crops between cabbage and coffee so that the soil is not depleted of nutrients. Eventually, farmers and project directors hope Lao-grown coffee will be widely recognized by global connoisseurs, and the project has helped developed the supply chain logistics need for this growth. Small factories have sprung up around the region to produce both whole-bean and instant coffee for export.

"The farming methods are improved, the coffee is high quality, and the price we get is fair. For now, we send the best stuff to Japan and sell the rest to local markets," Somboun said. The Government of Lao PDR hopes to sell improved coffee beans in even more markets, such as Poland and the Russian Federation.

These hopes are already playing out in Phao's small cabbage garden, where his coffee seedlings are pushing up through the soil. Each morning, he walks through the volcanic rock-studded garden, and inspects the tiny shrubs. This is his first attempt at growing coffee. Neighbors and village elders who have grown the beans for years helped him develop his knowledge of the crop and market needs. It is less labor-intensive than cabbage, said Phao.

The family's life is far from perfect, said his wife, Leum Sangsavang. They still rely on their seven children and two sons-in-law to work the land each day.

Still, she remembers recent years when they could not even afford vegetables to supplement their meager rice diet. Her children now enjoy afternoons on their stilted porch, gossiping and nibbling melon rinds over a field of plump cabbages.

"Cabbages used to look so tasty to us when we couldn't afford them," she said. "But we're so bored of cabbage these days that we only eat it once every 10 days or so. We're hoping for even more money once the coffee comes in."