AGRICULTURAL DEVELOPMENT AND ITS IMPLICATIONS FOR FOOD SECURITY AND FARMER

WELFARE: LESSON LEARNED FROM INDONESIA

Dr. Hasanuddin Ibrahim Assistant to the Minister of Agriculture for International Trade and Relation, Ministry of

Agriculture of The Republic of Indonesia 

THE 5th Global Economic Summit19-21 November 2015, Expo Center, World Trade Centre

Mumbai-India

Ajisakain 78M

swarnadwipa

JavadwipaPrambanan TempleBorobudur Temple

Intersection of the cultures

The current world population of 7.3 billions is expected to reach 8.5

billions by 2030, 9.7 billions in 2050 (UN, 2015)

Indonesian current population reached up to 256 million in 2015, and will grow even further predicted around of 285

million in 2030

Domestic agricultural production for food security and farmer welfare are

economically, socially, culturally and politically important in Indonesia.

3

INTRODUCTION

AGRICULTURAL DEVELOPMENT CHALLENGES

IN SOME DEVELOPPING COUNTRIES

INCREASE IN POPULATIO

N & URBANIZATI

ON

GLOBAL ECONOMIC SITUATION

GAP:-

SUBTROPIC DEVELOPPE

D- TROPIC

DEVELOPPING

>> COMPETITION

:FOOD, FEED,

ENERGY>> SLOW

DEVELOPMENT OF DOWN

STREAM INDUSTRIES

1

2

3

4

5

2. Seed

3. Infra-structure

4. Human Resources &

Agric machinaries

7.Financing

6. Farmers’

institution

5.Tech.& downstrea

m industries

1. Land

INDONESIAN AGRICULTURAL DEVELOPMENT ISSUES

5

• uncontrolled land conversion

• narrow land ownership• decreasing land quality

• weakness in seed research, production and distribution system

• high damage of irrigation network

• silting of reservoirs

• logistic and handling cost

• difficulty farmers’ access to credit (60 million of farmers)

• high interest rate• collateral problems

• conventional technology• few/slow-develop of

downstream industries

• unorganize farmers’ institutions

• limited capacities of farmers’ organisations

• declining interest of young people to engage in agriculture

• Java : abundant informal workers

• Outer island: limited workers

• GAP: academician and researcher versus poor paysant

Development progra

ms

Mid seventies :GREEN REVOLUTION

New Paradigm: Sustainable and Environmental Friendly

Positives:• 2-3 times prod cycle • Increasing in Productivity• Better Farmer Income• Economic multiplier Devmt (fertilizer/pest factory, trading...)

Negatives:• Environtment damages (methane, forest, smoke/fire..)• Local Wisdom

dissapp.• Bio-diversity, plant

material

BIO INDUSTRYAGRICULTUREAPPROACHES:clean, zero wastes,

Energy saving & effectives

7

VISION MISSION GOALS TARGET1. Self-sufficiency on rice, corn and soybeans and also increasing production of meat and sugar2. Increasing of food diversification

Increasing the value added and competitiveness of food and agricultural products

3. Increasing the value-added of commodities, competitiveness in order to meeting the export market and import substitution

Increasing the availability of raw materials and bioenergy bioindustry

4. to supply a raw material for bioindustry and bioenergy

3. create farmers welfare

Increasing the income and welfare of farmers

5. to increase the family farmer's income

4. conduct bureaucracy reform

Improving the quality of the government apparatus in agriculture which trustful and professional

6. Accountability of the government apparatus

Increasing the availability and diversification to achieve food security and farmers welfare

1. Achieve food security and farmers welfare

to create sustainable agricultural

bioindustry systems that produces a

variety of healthy food and high value

added products based on local resources for

food security and farmers' welfare

2. create sustainable agricultural bioindustry systems

STRATEGIC PLANNING MINISTRY OF AGRICULTURE 2015-

2019

8

MOA-01 increase the

availability and use of land

MOA-02Improved

infrastructure and agriculture

facilities

MOA-03 Development and expansion

of logistics seeds

MOA-04strengthening the

institutional farmers

MOA-08Strengthening and capacity building of agricultural

ROAD MAPTO ACHIEVE THE 2019 GOALS

MOA-06 The development

and strengthening of bioindustry and

bioenergy

MOA-07Strengthening

Marketing network

MOA-05The

development and

strengthening of agricultural

finance

MOA-10Improved

support for innovation and

technology

MOA-15Structuring and

strengthening of the organization

MOA-16Management monitoring system

Supervision support

MOA-14Pengelolaan Perencanaan

MOA-09Improved

support for quarantine

MOA-13Information and communication

technology

MOA-11Public

information services

Government

Farmers

society

Report

Availability of raw materials

for bioenergy & bioindustry

Government

Industry

society

Lawregulationstandard

Provision of facilities and agricultural

inputs

Demand for basic needs

MOA-12management

regulation

R&D

Su

perv

isio

n s

up

port

The added value and

competitiveness

Industry

Availability and diversification

Increased revenue and

Welfare

secretarial support

secr

eta

rial su

pp

ort

quarantine servicesSupporting human resources

Farmers

Demand for raw

materials

Demand coaching and

facilitation

AGRICULTURAL DEVELOPMENT PERFORMANCE

2010 2011 2012 2013 2014 2015*) -

10,000

20,000

30,000

40,000

50,000

60,000

70,000

8,220 3,087

21,145

6,292 12,036

62,629

Unit

*) until October 2015 : 47 thousand unit (75%)

2010 2011 2012 2013 2014 2015*) -

500,000

1,000,000

1,500,000

2,000,000

2,500,000

3,000,000

102,298 212,126

531,129 489,888 443,836

2,600,000

Hekt

ar

*) until 1 Oktober 2015 (80%)

2010 2011 2012 2013 2014 2015*) -

200,000

400,000

600,000

800,000

1,000,000

1,200,000

33,352 48,813

196,694 253,321 142,773

1,030,000

Hekt

ar

*) Until 1 Oktober (55,51%)

INFRASTRUCTURES REHAB AND MACHINERIES FOR POOR FARMERS

ACTIVITIES IN 2015:1. Rehabilitations of tertiary irrigation 2.1

million ha2. Land optimation 570 thousand ha3. The water pump 21 953 units4. Tractor 26,100 unit5. Rice transplanter 5563 units6. Power weeder7. Combine harvester 2,790 units

RESULTS:• Extended areas & increase

Planting Index (2.5-3 times/year)• Labor-saving:70%• Prod cost-effective : 30%• increase rice production 10-20%Cost-effective for tillage 30%

• three times speed from manual ways

• Cost effective for weeding 30%• Reduced losses until 2%• Cosy effective for harvesting 30 %

Paten Number: S-00201500614Paten Number: S-00201500619Cost –effective for planting 30%

Up 730 %

Up 763 %

Up 617 %

Realization of rehabilitation irrigation networks

Realization of optimizing land

Realization of agricultural machinery

EXTENTION ACTIVITIES AND INPUTS SUPPORTS

RESULTS:• The increase in planting area

380.87 thousand Ha • Productivity of paddy 5.29 tons/ha• Reduced Losses from 10% to 2%

ON-FARM & POST-HARVEST ACTIVITIES • Fertilizer subsidy: 9.55 million tons• Seed subsidy: 116 500 tons• Applied “Legowo” row pattern• 1000 Villages of “seed self sufficient”• 1000 Organic Villages • Combine harvester 2,790 units• Power Thresher 1,500 units• Rice Milling Unit 666 units

• Rendemen up 9%

Rice Processing Complex• Seed Superior• Legowo Row Pattern

2010 2011 2012 2013 2014 2015*) -

100,000

200,000

300,000

400,000

500,000

600,000

700,000

260,597 259,307 258,503

136,887 144,177

572,000

(Ton

)

*) until September 2015 : 58.604 Ton

Realization of Rice Seed Production for the type of extension seed

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

-

10.00

20.00

30.00

40.00

50.00

60.00

70.00

80.00

Million t

ons

Production of paddy 2000-2015

The highest rice production (2015) over the last 10 years (up

5,85 %)Sources: BPS, 2015Note: 2015 Data is Second Forecast Figures(ARAM II)

2000200120022003200420052006200720082009201020112012201320142015 -

5.00

10.00

15.00

20.00

25.00

Million t

ons

Production of Maize 2000-2015

Production of maize in 2015 is 19,83 million tons, up 0,82 million tons (4,34%)

Sources: BPS, 2015Note: 2015 Data is Second Forecast Figures(ARAM II)

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 -

0.20

0.40

0.60

0.80

1.00

1.20

Million t

ons

982,97 thousand tons, up 27,97 thousand tons

(2,93%).

Sources: BPS, 2015Note: 2015 Data is Second Forecast Figures(ARAM II)

Production of Soybeans 2000-2015

ACTIVITIES ON-FARM & POST-HARVEST• Optimization of 11 Private companies• Revitalization of 52 state companies • Wheel tractor-4: 2,100 units (1 tractors /150 ha)• The expansion of land sugarcane 315,000 ha• Improvement of road production 31,500 km (0.1

km / ha)• Improvement and maintenance of road

production (1 grader = 1500 ha• Unloading ratoon 68,000 ha (25%)• Maintenance of ratoon 270,000 ha• Superior seeds for 63 800 ha • Tool harvest of sugarcane: 3250 unit (1 whole-

cutting tool stock / 180 ha / per harvest)• Improvement of yield quality (rendemen): 10-

15%.

RESULTS: • Sugarcane harvest: 585,000 ha• Productivity: 80 tons/ha• Production of sugarcane = 2.72 million tons, up

3.65% compared to 2014 (2.63 million tons) • Production of sugar: 4.29 million tons • Increase of yield quality: 9 %

2010 2011 2012 2013 2014 2015 -

1.00

2.00

3.00

4.00

5.00

6.00

2.29 2.27 2.59 2.55 2.63

4.93

Million t

ons

Production of Sugar 2010-2015

Sources: BPS, 2015Note: 2015 Data is Second Forecast Figures

SUGAR PRODUCTION

RESULTS 2015:• Cattle Breeding Centers (SPR):

388 unit @ 1000 sapi• Perennial pasture: 1,950 ha• Breeders of beef cattle in SPR:

500.000 tails• Compost production: 9,500 ton• Private company: 3.300 tails• Production of beef carcass

cattle/buffaloes in 2015 is estimated 409 thousand tons increased by 5.23% compared to 2014

• Production has not been able to meet the needs of 454 thousand tons of meat consumption, so the balance was a deficit of beef 45 thousand tons.

ACTIVITIES ON-FARM & POST-HARVEST:• Cattle Breeding Centers (SPR)• Technology transfer / mentoring• Feed processed 14 thousand

tons • Guarantee of animal products • Application of animal welfare• Control of Zoonoses /vaccine • Land for animal feed 15,000 ha• Organic Fertilizer Processing

Unit (UPP)): 897 units• Investment of state company and

private company 13, 000 tails

BEEF AND BUFFALO PRODUCTION

FARMERS’ WELFARE

Terms of Trade for Farm Households Business per Subsector (2012=100)

Food crops Horticulture Smallholders Plantation

Animal Hus-bandry

Fishery National

September 2014 101.51 108.14 106.16 113.26 108.06 106.71

September 2015 106.6 109.06 103.2 116.88 108.22 108.66

October 2015 107.69 109.16 103.27 115.31 108.22 108.69

92.50

97.50

102.50

107.50

112.50

117.50

Index o

f Term

of

Tra

de

FUTURE STEPS OF INDONESIAN AGRICULTURE

NO TARGET NAWACITA (2015-2019) TARGET 2016

1 The expansion of new wetland areas : 1 million hectares Rice field extention : 200.600 ha

2 Expansion of dry land areas in out of Java: 1 million hectares

Dry land extention : 250.000 ha

3 Rehabilitation of irrigation networks: 3 million hectares Rehabilitation of tertiary irrigation infrastructure : 400.000 ha

4Construction of farm shop • Indonesia farm shop : 1.000 unit

5

Control of land conversion

• Map of Sustainable Food Crops Cultivation Area (KP2B) in : 3 Prov, 32 district, 16 Cities

• Publishing guidelines for incentive Sustainable Agricultural Land (LP2B)

• Identification of irrigated land6

Recovery of land degradation Optimization and land recovery of 275,000 ha of land

71000 Village Self-Seed development

2015: Construction 2016: Surveilance and mentoring

8 Construction of warehouses with post-harvest processing facilities in the production center

39 warehouses

9

Increasing the ability of farmers

• Agriculture education 914 group; SL 26 klp• Pelatihan 12.000 petani• Capacity building on integrated farming management (914

farmers group); capacity building on seed management (26 farmers group)

• Training for 12,000 farmers10 Control of food imports Food import regulation

11

1000 Village Organic Farming• 75 villages (20 fruit plant villages; 10 floricultural villages, 25

villages vegetables; 20 spices fresheners villages);• 250 Unit Home Composting

MAIN TARGET 2016 (ACCORDING TO NAWACITA)

MAIN FOOD PRODUCTION TARGET 2016

Paddy 75,13 million Tons

Maize 21,35 milliona Tons

Soybean 1,5 million Ton

Cattle/buffalo meat 0,59 million Tons carcass/0,46 million tons for meat

Sugar 2,8 million tons

shallot1.173 thousand tons

Chili 1.106 thousand tons

Cayenne pepper 759 thousand tons

20

CLOSING

Food Security and farmers’ welfare are among the important issues for Indonesia.

This country needs to modernize its agricultural production systems (BIOINDUSTRY APPROACHES)

Infrastructure rehabilitation especially for assuring water supplies, mechanizations, and extention services are the main government activities to help the poor farmers in the villages

Agricultural stakeholders should work together in one synergic team in village level: netwok, information, technology,

Important keys issues for the future Indonesian agriculture: zero waste, clean and environmental friendly, local wisdom, processed products and effective supply-chains

THANK YOU

• Production and Productivity Improvement of Rice, Maize, and Soybeans

1.1

23

A. Increasing Cropping Area • Raw land utilization and printing of 1 million hectares of new

paddy• Optimization of 1 million hectares of land,• The addition of 1 million hectares of dry land to soybeans and corn

as well as for other agricultural products,• Increased cropping index,• Utilization of abandoned land,• Application of intercropping patterns.B. Increasing Productivity• Implementation of integrated crop management rice, corn and

soybeans• The provision of improved seed rice and maize• Subsidies and provision of fertilizers• Organic fertilizer processing aid is about 1500 units• 1,000 villages self-seed development• Empowerment breeder seed • facilitation of agricultural machinery equipment as much as 70

thousand units• Development of network and optimization of water to 4.5 million

hectares,• Post-harvest equipment support around 30 thousand units,• Implementation of adaptation and mitigation of climate change,• Increased agricultural technical capacity for 70 thousand people• Strengthening the extension hall of more than 4000 units• The application of pest and disease control• Revitalization of rice milling around 2 thousand units• Utilization of planting calendar• Support science and agro-techno park in the area of production

centers• Institutional strengthening Counseling Center for Agriculture,

Fisheries and Forestry (BP3K) more than 5000 units.

OPERATIONAL STEPS2015-2019

• Production and Productivity Improvement of Sugarcane1.2

24

B. Cane Productivity Improvement• Structuring varieties of sugarcane and sugarcane seed

procurement• Application of good farming management• Ratoon crop replacement through unloading• Fertilization impartial

A. Stabilization Areal Cane• Stabilization of sugarcane land about 200 thousand ha / yr• The provision of land for gardens yielding seeds• The utilization of marginal land for sugarcane• Suppletion water through the dam or pumping• Provision soil moving tractors and other production facilities

C. Revitalization and Development of Sugar industry

• Encouraging increased milling capacity of existing sugar mills• Encourage the establishment of a new sugar mill in cane

production centers• Optimization of the rollers to prevent a decrease in yield• Milling capacity utilization of sugar millsD. Institutional and Financing• Strengthening of institutional research for sugarcane• Strengthening intitutional farming• Skills upgrading sugarcane farmers• Facilitation loans through KPTR• Funding for the revitalization and development of the sugar

factoryE. Government policy• Completion of the trading system of cane• Maintaining price stability at the farm level• Sugar import policy recommendations

OPERATIONAL STEPS2015-2019

• Production and Productivity Improvement of Meat

1.3

25

B. Development of animal feed• Development of forage approximately 4 million cuttings per year• Development of processed feed / feed materials about 14 thousand tons

per year

A. Increasing a productivity of local cattle• Optimization of artificial insemination and estrus synchronization at about 2

million/year acceptor• Procurement superior stud cattle and buffalo• The provision of water for livestock• Prevention of reproductive disorders and improved animal health services• Control of productive female

C. Provision of livestock breeds• Seed supply approximately 5 million doses and four thousand embryos• Provision of embryos 50 thousand heads• Certification institutional and livestock breeding area of about 4 million

certificates per yearD. Animals Health• Handling control contagious animal diseases and zoonoses located

approximately 4 million doses per year• Investigation and testing of animal diseases and animal medicine certification

about 150 thousand samples per year• Institutional strengthening veterinary authorities• Production of vaccines, veterinary medicines and biologic materials about 8

million doses per year• Strengthening national animal health system in 34 provincesE. Veterinary public health, post-harvest and marketing

• Strengthening and improvement of management Slaughter House (RPH),• the application of animal products guarantee a safe, healthy, whole and

kosher• Facilitation meat stall, livestock markets and marketing arrangements cow /

buffalo and meat.• the application of animal welfareF. Regulation

• local regulations on the slaughter of productive female cows• local regulations on the development of cattle in oil palm plantations• Livestock and meat import regulations• provision of credit facilities• Controlling of prospective cow stock

OPERATIONAL STEPS2015-2019

• Increasing Food Diversification

2

26

A. Increasing public food reserves

• Empowering 350 joint farmer group/year• Empowering 1.500 barns/thnB. Improving in food crisis and food insecure handling

• Developing a independent food regional in more 200 region/year• Strengthening the awareness of food and nutrition in more than

450 locationsC. Increasing diversification of food consumption and nutrition• Developing a sustainable food home region (KRPL) Models in

more 4.500 villages / year• Promotion of the diversification of food consumption• Increasing knowledge and awareness to consume a variety of

foods with balanced nutrition principles;• Improve skills in order to develop a local food processing; • Develop and disseminate an appropriate technology for local

food processingD. Improving a quality of public food distribution• Build a warehouses with post-harvest processing facilities in

each production center• Strengthening national logistics system for production inputs and

food products, including remote areas• Warehouses Supervision , monitoring and controlling

developments in food prices and price fluctuations through market operations

• Mapping and development interconnectedness supply chain of agricultural commodities

• Recommendations for food imports management

OPERATIONAL STEPS2015-2019

• Improvement on Value Added , Competitiveness, exports and import substitution

3.1

27

A. Readiness of upstream agricultural and agricultural cultivation

• Increasing production of exports commodity and import substitution

• Development and implementation of quality standards of agricultural products through the application of GAP, GHP, land registration and registration of post-harvest wardB. Increasing value added through processing

• Developing 5000 processing unit supporting the food industry and agriculture-based rural

• Facilitation and implementation of standards, quality assurance systems and food security in 700 business groups

• Supports the cultivation area integrated with processing centers

D. Increasing of Export Value • Coaching group to meet export quality standards• Development of potential export markets• Strengthening the role of agriculture attache as a market

intelligent

C. Mastery of the domestic market in order to import substitution

• Revitalization of facilities and institutional markets of agricultural products 60 units / yr (farmers' markets, sub terminal agribusiness, livestock markets, meat stall)

• Promotion of agricultural products in the country• Stabilization of prices of agricultural products• Network development market is well integrated between

production centers with consumer centers through 100 units of market information services

• Development of logistics and warehousing system as a system of stock

• Recommendations of Import and export policy

OPERATIONAL STEPS2015-2019

• Production dan productivity improvement of competitive horticultural products

3.2

28

A. The Development of horticulture area• Developing and coaching 7000 hectares of horticulture• Improvements a garden / land’s Infrastructure• Registration 2.000 lands for horticultural businesses• Facilitation 3000 units of post-harvest infrastructure• The application of innovative technologies• Developing an organic village based on horticulture

B. The Development of seed systems • Strengthening of 158 institutional seed breeder• Development of the seed industry• Provision of seed sources• Provision of extention seed of horticultural crops

C. The development of environmentally friendly horticultural protection system• Pest management through 650 integrated pest management field school

each year• The development of 250 units / year pest management clinic • Increasing a public awareness and facilitating the implementation of

plant protection• Improving environmentally friendly pest control technology • Environmentally friendly pest control in endemic attack areas, the source

of infection, regional and local explosive new attacks• Recommendations of climate change’s impact

OPERATIONAL STEPS2015-2019

• Production and Productivity Improvement of competitive Plantation

3.3

29

B. Increasing Productivity• Provision and procurement of quality seed • Application of good agriculture practice• Development of pest management through SL-PHT• The anticipated impacts of climate change• Handling pests organism

A. Stabilization of Plantation Areal • Stabilization of plantation land about 54 thousand ha / yr• Provision of land for yielding seeds plantation • Utilization of marginal land• Water suppletion through the dam or pumping• Provision 1500 cultivactor tractors and other production

facilities

C. Institutional and Financing• Institutional strengthening and research platation results• Strengthening of Institutional farming• Increasing skills of farmers• credit facilitation• Business interruption and plantation conflict handling

D. Government Policy•Completion of the plantation crops trading system•Maintaining price stability at the farm level•Recommendations of Export and import of plantation

products policy

OPERATIONAL STEPS2015-2019

• Provision of raw materials for bioenergy and bioindustry4

30

A. Provision of raw materials for Bioindustry• Preparation of bioindustry development roadmap• Development and implementation of quality standards of

commodities of industrial raw materials through the application of GAP and GHP

• Development of bioindustry raw material commodity production area and production integrated with an industrial area

• Research development in order to optimally utilize the content of crops and livestock

B. Provision of raw materials for Bioenergy• Encourage the provision of energy raw materials in order to

supply renewable energy (including biofuels) amounted to 23% of the total national energy consumption in 2025

• Utilization of byproducts of livestock and crops as energy raw materials

• Developing a potential commodities as a energy raw material without disrupting production targets for foodstuffs society

• Development of efficient bio-energy research

OPERATIONAL STEPS2015-2019

• Improving the Welfare of Farmers

5

31

OPERATIONAL STEPS2015-2019

• Protection of farmers through the provision and improvement of distribution system input subsidies, safeguards prices of agricultural products at farm level and a reduction in the burden of risks of farming through agricultural insurance.

• Empowerment of farmers through farmer institutional strengthening, improvement of skills and access to capital resources.

• Support policies for improved access and assets of farmers to land through the distribution of land rights of farmers with land reform and land tenure program for agriculture, especially for smallholders and agricultural laborers, so expect cultivation of land up to 2 hectares per farmer.

• Provide an opportunity for farmers in developing business in the processing of agricultural products so as to provide additional income for farmers.

• Encourage the use of byproducts and waste from agricultural product in order to increase revenue.

• A group of business systems to improve the efficiency of farming costs.