Euromonitor reports that in 2021, Cambodia’s economy expanded in real terms, driven by increasing domestic consumption, public investment and external demand. However, the persisting pandemic-related risks, supply constraints and global inflationary
pressures raise uncertainty and weigh on the country’s economic outlook.
The total population has been slowly rising over time, reaching 16.7 million in 2022 (CIA World Factbook Est.). This was an increase of roughly 4.6 million over 2000. The median age in 2022 was 26.4 years. The number of those over 65 years of age amounted to 777,000 thousand in 2022, equivalent to 4.6% of the total population.
USDA’s Office of Agricultural Affairs (OAA), in Vietnam reports that Cambodia’s healthy tourism industry and the growing bakery, quick service restaurant, and retail sectors offer the best opportunities for U.S. exporters of high-value foods
and beverages. Consumers of U.S. products are likely to be young and higher-income Cambodians, expatriates, and tourists. There is a surprisingly wide range of U.S. food products available in Cambodian supermarkets and growing foodservice
Although the vast majority of food is sold in traditional markets, the situation is changing as more supermarkets, convenience stores, quick-service restaurants, and other modern outlets are opening. There is limited food manufacturing in Cambodia, contributing to the impressive variety of imported processed foods from the U.S. and other sources.
Cambodia’s trade volume has increased significantly since the country’s accession to the ASEAN in 1999 and to the World Trade Organization (WTO) in 2004. Since its WTO accession, Cambodia developed trade-related laws and regulations to comply with WTO obligations and has eliminated most non-tariff barriers to trade. In 2006, the United States and Cambodia signed a Bilateral Trade and Investment Framework (TIFA). Several rounds of TIFA discussions have been held to promote trade and investment between the two countries to help monitor and support Cambodia’s efforts to implement its WTO commitments and to address bilateral issues.
As a member of the ASEAN free trade agreement, combined with the country’s improving infrastructure and growing skilled workforce, Cambodia has tremendous economic potential. Currently, Cambodia has FTAs through ASEAN with Australia, New Zealand, China, India, Japan, and South Korea. At of the time of this report, Cambodia is also negotiating FTAs with South Korea and the Eurasian Economic Union. The recently signed Cambodia-China FTA and the Regional Comprehensive Economic Partnership (RCEP) have offered potential access to the markets of China, India, Australia, and New Zealand.
According to Trade Data Monitor (TDM), annual global exports of consumer-oriented products to Cambodia were up 21% year-on-year, from US$1.1 billion in 2018 to US$1.4 billion in 2019. U.S. exports of consumer-oriented products to Cambodia increased by 578% over the last ten years, from US$4.3 million in 2009 to US$29 million in 2019, making this the second fastest growing market in Asia after Myanmar.
Post adds that like all vital U.S. agricultural export markets, Cambodia comes with its own unique opportunities and challenges.
2021 U.S. exports of agricultural products to Cambodia totaled US$104.7 million, which was growth of 57% from the prior year and a new record high. Over US$35.9 million were of the consumer oriented variety or just over 34% of the agricultural total,
also with record high and growth of 12%. U.S. exports of processed foods to Cambodia totaled US$27.9 million in 2021, which was up 5% from that of 2020 and yet another high value.
Top U.S. processed food exports to Cambodia in 2021 included:
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According to Euromonitor, retail sales in the packaged food market in Cambodia will reach US$898.6 million in 2022. That represents a growth rate of 29.4% or US$204.1 billion since 2018. By the year 2026 the retail sales in the packaged food
market in Cambodia is expected to reach nearly US$1.1 billion, a growth rate of 21.6% and US$193.8 million from 2022.
High growth products in the forecast include:
FAS Hi Chi Minh City reports that although traditional markets still dominate Cambodia’s retail sector, rising disposable income, a large expatriate non-government organizational (NGO) workforce, and a strong tourism industry have contributed to
the growth of modern retail outlets, including shopping malls, mini-marts, convenience stores, and supermarkets. Within the past few years, Cambodia’s retail sector has undergone a major transformation, as Cambodians are slowly and steadily
shifting from traditional markets to modern markets due to better hygiene, quality, and variety.
Correspondingly, the grocery market industry in Cambodia is predicted to reach US$9.3 billion by 2023, according to UK-based Institute of Grocery Distribution. From 2015 to 2019, total retail space in Cambodia had doubled, from approximately 174,000 to 370,000 square meters. This amount of available retail space was estimated to reach 478,000 square meters by the first quarter of 2020, a 29% increase from 2019, as forecasted by the Coldwell Banker Richard Ellis (CBRE) group.
A wide variety of U.S. products can be found in modern retail outlets and include a number of famous brands, such as Post cereals, Blue Diamond Growers’ non-dairy milk, Kraft’s products, General Mills’ cereals, Bragg Organic Raw Apple Cider Vinegar, Heinz’s products, Bob’s Red Mill’s products, Costco’s Kirkland Signature’s products, Hunt’s tomatoes and sauces, Uncle Ben’s rice, Norbest Turkey, Lamb Weston frozen French fries, Washington apples, Hormel luncheon meats, Ocean Spray fruit juice, Campbell canned soup, Hershey’s chocolate, Kellogg’s cereals, Betty Crocker cookies and cereals, Jim Beam bourbon, and certain California wines.
Phnom Penh, Siem Reap, and Sihanoukville have become hot spots for Cambodian retailers, with new supermarkets and shopping malls sprawling in these cities. Convenience store chains are also increasing in popularity and 7-Eleven is set to open its first store in Phnom Penh in 2021, offering international beverages and food products along with ready-to-eat meals designed for local tastes. Moreover, megamalls such as the Phnom Penh Mega Mall and Chip Mong 271 Mega Mall opened in 2021 and 2022, respectively. The Lucky Market Group, Cambodia’s leading retail chain, currently operates 11 Lucky supermarkets, nine Lucky Burger fast-food operations, and six Guardian pharmacies, and has plans for further expansion. Lucky imports a number of products directly from the United States, such as frozen potatoes. They also import additional products through consolidated shipments from Singapore. DFI Lucky Private Limited is a joint venture between Dairy Farm International (DFI), Hong Kong (70%) and Lucky Market Group (30%).
The Japanese retailer AEON opened a large hypermarket mall in 2014, attracting 15 million visitors in its first year. AEON opened its second hypermarket (AEON 2) in 2018 and plans to open a third hypermarket (AEON 3) in 2023. Although AEON imports many of their products from Japan, Thailand, and Singapore, these hypermarkets also carry some U.S. brands.
Other food retailers that offer imported products include: Bayon Markets, Thai Huot Supermarkets, Makro, Veggy's, Super Duper, Grocerdel (online retailer), and DeliShop (online retailer), and GroceryDelivery (online retailer). Super Duper and DeliShop currently source their U.S. products from one supplier. Although most modern retail outlets are in Phnom Penh, there is an increasing number in Siem Reap, including Angkor Market, Lucky Market, Thai Huot Market, Makro, and Asia Market.
Modern retailers in Phnom Penh often import from foreign suppliers, while smaller supermarkets in Siem Reap position themselves as distributors, sourcing products from importers based in Phnom Penh. Retailers, such as DFI Lucky and Thai Huot, also service the Hotel, Restaurant and Institutional (HRI) trade through their retail stores and wholesale operations.
FAS Hi Chi Minh City reports that based on trends in export trade data from 2015 to 2019, the best prospects for U.S. products include nonalcoholic beverages (367% increase from 2015), dairy products (266% increase from 2015), beef and beef products (253% increase from 2015), processed foods (202% increase from 2015), and fresh fruits (76% increase from 2015).
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