Pre-feasibilityfieldstudy:PotentialtoboostagricultureproductionintheTasikmalayaarea

Finalreport

Submittedto:

GovernmentoftheSultanateofOman

January2018

2

ExecutivesummaryThescopeofthisstudyistodeterminethepotentialforexportsofagriculturecommoditiesandproductsfromtheTasikmalayaregionthroughtheproposednewportofCikalong.ThefocusisatcurrentandpotentialfuturevolumesafterinvestmentandmodernisationinTasikmalaya.Asthestudywillshow,thepotentialistherealthoughcurrentvolumesarestilllimited.WhatappliestoTasikmalayacanpotentiallybeappliedtoneighbouringKabupaten,furthercontributingtoSouthWestJava’sexportpotential.DuetoasubstantiallackofmodernisationinallaspectsofIndonesianagricultureanditsfoodvaluechain,Indonesiaasanationisstilldeficitforrice.Therefore,fornow,onlycertainquantitiesofBasmati(equivalent)riceand/ororganicricecanbeexportedand/orwillbepermittedtobeexportedbytheIndonesianGovernment.However,exemptionscanbegivenasisexpectedinthecaseofTasikmalayaduetotheformalsupportoftheCentralandProvincialGovernmentforitsmodernisationasoneofIndonesia’spoorestyetpromisingregionswithahighlevelofunderemploymentandchildmalnutrition(46%).Asaresultofthecountry’scurrentoveralldeficitanditslimitationforriceimports,thepricethatlocalricefarmersgetfortheirproduceiscurrentlymorethandoubletheworldmarketprice.Besidesthat,localricefarmersarecapableofproducingriceatamuchlowercostthanatworldprices.InJanuary2018,theIndonesianGovernmentannouncesitwillimportriceinthefirstquarterofthatyear.Unlessthericeisusedforstrategicreservesonly,theimportisexpectedtoharmincomesoflocalricefarmersasimportedriceischeaperthanlocallyproducedrice(https://www.cnnindonesia.com/ekonomi/20180115195141-92-269101/impor-beras-bikin-harga-gabah-dan-beras-makin-tertekan).ThecostpriceofriceinTasikmalayaisbetweenRps1,500and2,000(0.112-0.149$)/kg.So,intheory,atworldmarketpricesthesefarmerscanmakeaprofitwhenexporting.ButduetothenationwidedeficitthepricetheyreceiveatlocalmarketlevelisbetweenRps10,000and11,000(0.748-0.822$)/kg.,makingthelocalmarketmoreattractivethantheexportmarket.Theincentiveforfarmerstoexportriceonlyoccurswhencheapimportswillenterthecountryatlarge-scale,orwhenabetterpriceismadethroughspecialtyproductssuchasBasmatiandorganicproduce.Thesequantitiesareprojectedinthetablebelowaspotentialhigh-valueexportproducts.Indonesiaproduceslargequantitiesoffruitandvegetables,mainlybysmall-scalefarmers,andmainlyforthelocalmarket.Thefruitandvegetablesvaluechainslackthelogisticsrequiredforvolumeandqualityconsistencyforexport.Undercurrentcircumstances–highlyappreciatedinhighvaluemarketslikeJapan,SingaporeandHongKong–mangosteenandchilipepperswerefoundtohavethehighestpotentialduetotheirspecialfeaturesandrelativelywellcoordinatedvaluechain.Theseproductsarethereforealsoprojectedaspotentialexportproducts.Othersectorswithpotentialbutstillinneedtobedevelopedarebambooandtea.Bambooproducedintheregioncanwellbeprocessedintofloorandwallmaterialforwhichalargeandgrowingglobalmarketexists.However,totakethisopportunity,investmentsincommercialproduction,technology,sourcingandprocessingisrequired.Teaproduction,collectionandprocessingisanothersectorwithhighpotential.However,asfruitsandvegetablesandderivedagri-foodproductsthesetoorequireinitialinvestmentincommercialprocessingtoachievemarketablevolumes.Alloftheseproductshavethepotentialofbeingpotentialexportproducts.Otherproducts,suchasstrawberries,bananas,mango’sandotherexoticfruits,willrequirehighinvestmentsinlarge-scalecommercialproductionoflarge,uniform,andgoodqualityvolumes.Currentlyproductionisdonebysmallscalefarmers.Highpotentialforportdevelopmentisenvisagedbyfocusingonimportingcommodities,suchaswheat,soyaandcattle,forwhichthecountryisstructurallydeficit.SuppliestothelargeurbancentresofBandungandTasikmalayacanbemucheasierrealizedthroughanearbyanduncongestedportatCikalong.Cattleimportshavebeenprojected,importsoftheothercommodities,suchasmaize,soyandwheat,requireadditionalresearchinthefeasibilityphase.Asummaryofpotential

3

exportsofresearchedagri-produce,calculatedinnumberofcontainersperweekfromtheTasikmalayaregion,isprovidedbelow.Thistableexcludesexportsoffruitsandvegetables(suchasbananas,mangos)thatmaybereachedthroughsubstantialinvestmentsincommercialproduction.

Importsofcommoditiescouldstimulatethedevelopmentofanagro-industrialcomplexatornearbytheport.Thiscouldcombinecattleimportswithbreedingandfatteningfacilities,andwithslaughterhousedevelopment.Itcouldalsoincludegrainstorageandprocessing(milling),livestockfeedprocessing,andpoultryfarmingandprocessing.Suchintegratedcomplexwouldservetheurbancentresandthecommunitiesnearby,andwouldprovideworkandincomefortheruralcommunityneartheprospectedport.Toreachcommercialproductionofhighvolumesforexportoftheagri-productsinthetableabove,largeinvestmentsarerequired.Mostproductioncurrentlycomesfromsmall-scalefarmers.Besidesprofessionalization,alsolandconsolidationtoenablecommercialisationwillbeneeded.Varioushigh-levelroundtablesandmeetingshavebeenheldduringthepastyears,basedonthoroughresearch.Asshowninthefigurebelow,priorresearchfoundthatthrough‘modernization’ofagricultureandamodestproductionshiftintheTasikmalayaareaandneighbouringKabupatenfromricetoothercrops(vegetables,fruits,soybean,maize),thefullrequiredimportsofTheGovernmentoftheSultanateofOmancanbeproduced,includingthatofpoultry.

ForpriorresearchandconclusionsonintegratedsolutionstocommercializeagricultureproductionintheTasikmalayaareatheconsultantsthereforealsorefertothefollowingreportsanddocuments:“CikalongPort:aholisticintegratedagri-inframodernisationproject(2017)”;“Tasikholisticallyintegratedagri-inframulti-stakeholderproject(2017)”,“QandATasikproject(2017)”,and“Tasikjointbrainsholisticallyintegratedagri-inframodernization(2017)[figureabove]”.

4

Tableofcontents1. Introduction 51.1 Background 51.2 Approach 51.3 Researchquestions 62. Riceexportpotential 62.1 Overviewofsectorpotentialandbottlenecks 62.2 Potentialforbasmatiriceexport 72.3 Potentialforcertifiedorganicriceexport 103. Fruitandvegetableexportpotential 113.1 Overviewofsectorpotentialandbottlenecks 113.2 Potentialformangosteenexport 113.3 Potentialforchilipepperexport 133.4 Potentialforteaexport 143.5 Potentialforbambooexport 154. Concludingonpotentialexports 164.1 Consolidatedexportsinaportdevelopmentcontext 165. Importpotential 175.1 Potentialforlivestockimport 175.2 Potentialforothercommoditiesimport 185.3 Potentialforanintegratedagribusinessparkapproach 186. Otheraspects 196.1 Proposedusufructapproach 196.2 Nextstep:environmentalimpactanalysisandCSR(basedonsocialimpactanalysis) 206.3 Includecooperativesmall-scalefarmerprojects:exampleofpalmsugar 20Annex1:Productionareasandlocationsofexpertinterviews 21Annex2:Expertinterviewlist 22Annex3:CVsofexpertsthatcarriedoutthisresearch 23Box:TheBasmatipatentissueand‘Tasmati’rice 9Figure1:ExportablevolumesofBasmati(Tperannum) 9Figure2:Exportablevolumesoforganicrice(Tperannum) 10Figure3:Exportablevolumesofmangosteen(Tperannum) 13Figure4:Exportablevolumesofchilipeppers(Tperannum) 14Figure5:Exportablevolumesoftea(Tperannum) 15Figure6:Exportablevolumesofbamboofloorsandwalls(Tperannum) 16Figure7:Ratio’susedtocalculatethenumberofcontainers 16Figure8:Exportablevolumes,consolidated(Tperannum,containersperweek) 17

5

1. Introduction1.1 BackgroundDuringameetingwithahigh-leveldelegationfromtheSultanateofOmanon20November2017inJakarta,IndonesianMinisterofTransportationBudiKaryaformallyconfirmedthattheIndonesianGovernmentwillallowapotentialnewPortofCikalonginTasikmalaya,SouthWestJava,tobecomea‘SpecialPort’.ThisSpecialPortwillaimtorapidlyfacilitatetheexportofagricultureproduce,whichwillcomefromfuturesurplusproductionthroughmodernizationofthepresentagricultureproductionsystem.TheSpecialPort–thatlatercangrowintoaGeneralPort–willbeoperatedbyaSpecialPurposeCompany(SPC);itsownerswillbethevariousinvestorsinandusersoftheagri-infraproject.Themodernizedagriculturalproductionsystemprojectwillhavevariousanglesandvariousprojectpartners.TheTasikmalayaareawillserveasthepilotareatoboostagricultureproduction,asitissituatedclosetotheCikalongportarea.TheAsianInfrastructureInvestmentBank(AIIB)supportstheprojectofanewPortofCikalong.TransportationMinisterBudiKaryaisprovidingauniqueregulatoryopportunitytomakethisareality.MaritimeAffairsDirectoroftheInfrastructureofShipping,Fishery,andTourismDr.Eng.RahmanHidayatwantstomakeTasik’spotentialnewCikalongPortademonstrationprojecttomanyotherSouthJavaneselocations.BandungMayorRidwanhasindicatedthatthecity’ssubstantialindustrialestateswillturntheirindustrialtrafficSouthwardassoonasCikalongPortisrealised.“Indonesiawillbecometheworld’s4thlargesteconomyby2050,butthatdevelopmentstartshere,inTasik,”saidTheJakartaPostEditor-in-ChiefEndyBayunion4thNovember2016duringamulti-stakeholderconferenceinTasikmalaya’sPendopo.Indeed,bythetimethatCikalongPortisbuilt,Tasikmalaya’sagri-foodproductionwillhavereacheditsfirstmaturityincludingsubstantialcargosofsafe(orevenorganic)Basmatirice–thestaplefoodofchoiceinOmanandintheGulf.TheportmaybecomeahubbothforOman’slong-termfoodsecurityandfortheOmaniPortofSohar’sfunctionofsafefoodhubfortheentireGulf.OmanandotherGulfstatescanthusbecomekeyinvestorsinboththeportandagriculturedevelopmentprojects.FarmersparticipatinginproducingproduceforexporttoOmanandtheGulfwillbenefitthroughausufructapproach.Usufructcontractsallowfarmerstoleasetheirlandtoproduceforexport(income),toprovidelabourtoproducethecropsforexport(income),andtoreceivepartoftheharvestforownconsumptionandlimitedlocaltrade(food).Thisapproachisexplainedindetaillaterinthisreport.TheGovernmentoftheSultanateofOmanhasrequestedthattheirpotentialinvolvementinthisprojectisprecededbyacomprehensiveagripre-feasibilitystudy.PioneersConsultingdeliveredthispre-feasibility.1.2 ApproachTheconsultantscarriedoutdeskresearchfromtheNetherlandswhichwasfollowedbyoneweekoffieldresearchintheprojectarea(theTasikmalayaagricultureproductionarea)wheretherice,fruit,vegetablesectorsarewellrepresented.Discussionsandinterviewswereheldwithrelevantfarmers,processors,governmentofficials,andknowledgeproviders.Interviewsweredocumentedandworkedoutintothisreport.Basedonoutcomesoftheexpertinterviews,andonpriordeskresearch,thisreportprovidesconclusionsandrecommendationontheresearchquestions.Thereportalsoincludesconclusionsonanewresearcharea:thatofthepotentialofcommodityimports.Textineachchapterreflectsthefacts,figuresandviewsofthoseexpertsthatwereinterviewed.Thereportprovidesanobjectiveandrealisticadvicetotheclient.Thereportcanbeusedfordefiningfurtherfocusandnextsteps.Annex1and2provideanoverviewofthevisitedareasandkeyexpertsthatwereinterviewed.

6

1.3 ResearchquestionDeskandfieldresearchcarriedoutbytheconsultantswereaimedatgaininginsightsintheoverallresearchquestionofthisstudy:“Whatisthefeasibilityofincreasingrice,fruit,andvegetableproductionforexportintheTasikmalayaprojectarea?”.Specificguidingquestionsthatwereusedduringinterviewswithvariousexpertsintherice,fruit,andvegetablevaluechainswerethefollowing:

- Whatisthefeasibilityofincreasingproductioninthearea?- Howcanthisbeachieved?- Whatkeybottlenecksneedtobedealtwith?- Byhowmuchcanproductiongrow?- Atwhatestimatedcoststodoso?- Howwouldthiscontributetotheambitionofexportinglargevolumesofhighquality

producefromtheprojectareatoOman?Insomecases,thestudytakesintoaccountthattheresultofthispre-feasibilitystudycanalsoapplytoneighbouringKabupaten,implyingapotentialsubstantialextensionorbulkingofharvests.2. Riceexportpotential2.1 OverviewofsectorpotentialandbottlenecksIndicativeinformationfromdeskresearchlookedatmeanstoincreaseproductivityofrice,andfocusedonSRI(SystemofRiceIntensification).SRI,asalreadypracticedbyseveralfarmersinTasikmalaya(forexampletheCooperativemanagedbyMsEmilySutanto,leadingtohighqualitycertifiedorganicriceexporttoJapan,theUSandtheEuropeanUnion.(see:https://www.youtube.com/watch?v=0jtXFAotpwQ&feature=player_embedded&app=desktop)SRIcanresultin50%moreproductionwithrelativelylessinputsovertime.Itisaglobaldevelopmentthatincreasesoptimisation,yetitislabourandknowledgeintensiveandwithoutassistancefarmersmaybescepticalaboutit.ThefocusofapplyingSRIisontheirrigationinfrastructurewhileusinglesswater.Itresultsinproductiongrowthwhilebeingabletoreduceoninputs–suchasonseed,chemicalsandwater.Theapplicationenablestoreducewaterrun-off,compostapplication,andsingleseeding.ThisreportestimatesthatfullimplementationofSRIinTasikmalayawilltakearoundfouryears.Tasikmalayahassucceededinattractingtheworld’sleadinghightechagri-productioncompaniessuchasKoppertfromTheNetherlands,whichisalreadyactiveintheSultanateofOman,torunexperimentalfarmsinTasikmalayaasof2018.SeveralotherMembersoftheIBMA(producersofLowRiskBio-pesticides)havebeeninvitedtosetuptestfieldsinTasikmalaya.IBMAisplanningtheirnextglobalmeetinginJakartaandTasikmalayainJune2018.(see:https://www.nationalgeographic.com/magazine/2017/09/holland-agriculture-sustainable-farming/)Indonesiaproducesaround70milliontons(T)ofriceannually.TheIndonesiangovernmentimportagencyBulogimportsapproximately2millionTannuallytokeepupstrategicreserves.Buloghasthemonopolyforimportsandsafeguardspricestability.Theykeepapermanentstockofaround2millionT.Bulogfollowsatwo-waystrategy:firstly,toimproveproductionbytechnicalassistanceandfertilizersubsidies,andsecondlytocurbconsumptionunderthemotto‘onedaywithoutrice’.IntheTasikmalayaarea,totalriceproductionisestimatedtobe900,000T,whichisproducedon50,000hectaresofland.Thisismostlylocallyconsumedorlocallysold.Thecurrentproductionratioisaround18Tofriceperhectareat3cropsperyear(oraround6Tperhectareperharvestseason).

7

Besidesanalreadyexistingsurplus(seenextchapter),anadditionalsurplusforexportcouldbegeneratedbyimplementingSRI,creatinganadditional30%overthe900,000T,or300,000Tofsurplus.Additionalinvestmentsinpost-harvestfacilities(storageanddrying/milling)forthis300,000Tsurpluswillbebasedonarequiredcapacityfor100,000Tpercrop.Post-harvestcostsareestimatedtobeabout$90perT,whiletheproductioncostsareestimatedat$150perT.Thisbringsthetotalcostpriceforthissurplusriceat$240perT.Theworldmarketpriceisaround$400perT.ThismeansthatbyintroducingSRIintheregionthe300,000Tsurpluswillhaveavalueofaround$100million.ItshouldbenotedthatworldmarketpricesareexpectedtogrowsubstantiallyinviewofwatershortagesandgroundwaterpollutioninmajorproductioncountriessuchasChina.Asof1January2018,India’sBasmatiricewillbebannedfromtheEuropeanUnionandtheUKduetosubstantialoveruseofpesticides(tri-cyclazole).Thebanmaylastseveralyears,openingupawindowofopportunityforother(Basmati)riceproducers,includingfromTasikmalaya.ThefieldstudyrevealedthatthepricereceivedbytheTasikmalayafarmersisintherangeofRps10,000-Rps11,000(0.748-0.823$)perkg.Thisismorethantwicethatoftheworldmarketprice.Thiscanbeexplainedbystronginternalmarketdemandcombinedwithlimitedsupply,and/orbythetendencytoinflateproductionfigures.TheincentiveforTasikmalayafarmerstoexportmainstreamriceisthereforealmostreducedtonothing,astheycurrentlyoperateinacomfortablelocalvaluechain.Theincentiveforfarmerstoexportmainlyoccurswhenabetter(worldmarket)priceisavailable,whichisthecaseforspecialtyproductssuchasBasmatiandorganicproduce.Theseoptionsarediscussedbelow.2.2. PotentialforBasmatiriceexportProductionIndonesiaisanetimporterofrice.Riceisastrategiccrop;themarketdemandisnotalwaysleadingthesupplyorprice.ThereisnoorverylittledomesticdemandforBasmatirice.AccordingtotheTasikmalayaAgriculturalOffice,theTasikmalayaareacurrentlyaccountsfor300,000Tsurplusinriceproductionperyear(withouttheSRIsurplusdiscussedabove).Thissurplusiscurrentlytakenupbythenationalmarket,andcan,intheory,beexported.Ittranslatesinapproximately17,000ha.ofriceproductionarea.However,exportinglocalriceisnotveryattractiveforfarmers,whichistheresultofmarketdistortions–asystemofsubsidiesandtheimportbanonrice.ThehectaresofsurpluslocalriceproductioncanbeallocatedtoproductionofBasmatirice.Aricemillerthatwasinterviewedoperateswithamillingcapacityof500kg/hr.,or100T/season.Atthreeseasonsperyearthiscomesto300T/year.Hismillingcapacityallowstomillfor150farmersperseason,whichequalstoapproximately50ha.Thisyear,themilleralsostartedtotest-produceBasmatirice.HereceivedtheseedfromtheRiceResearchCentreinBandung.CostsofBasmatiriceproductionperha.is7mlnRps(524$),orroughly1mlnRps(74.8$)/T.Theresultsofthisdomesticmarketactivitysofararesomewhatdisappointing:Basmatiriceresultsinayieldof2.5-3T/ha.ofarelativelypoorquality,whereaslocalmainstreamricedoes6-8T/ha.MilledBasmatiricecanbesoldtothenicheexpatmarketinJakarta,at30,000Rps(2.244$)/kg.,whilethelocalriceissoldat10-11,000Rps(0.748-0.823$)/kg.Tasikmalayaagro-scientistsconfirmthatthepictureasdescribedhereisrepresentativefortheregion.BasmatiricedevelopmentinJavaisatitsearlystages,needstimetobedevelopedandacceptedintheworldmarket–unlessamajorinvestor/buyerstimulatesrapidprogress.ThehighpricepaidfortheBasmatirice(byLantaburaInternationalcompanyinJakarta)makesitattractivetoproduceforthelocalnichemarket.However,thisisaverysmallmarketmostlysupplyingexpatriates.Therefore,thelocalmarketmustbeexpandedwithaninternationalmarket.Areaswhereimprovementsneedtobemadearethefollowing.Thecurrentbotanicalcharacteristicsarestillnotequallingtherealbasmati.Thegrainsaretoothinandshatteringtakesplace.Integrated

8

PestManagement(IPM)practicesneedtobeimproveddramaticallyandsoilfertilityissuesneedtobeimproved.Productionlevelsmustequalthoseofmainstreamrice.Thiscanbeaccomplishedeventually,butrequiresconsiderablelongterm(field)researchincooperationwiththevaluechainplayers–unlessthisisbetterfunded.Inaddition,themillingmachinerymustbeadjusted(ornewmachineinstalled)toreducebreakingofthegrainduringmilling.Thisisashort-termchallengehowever.Whenthesebottleneckscan(gradually,orifwell-funded,morerapidly)besolved,theBasmatiorequivalentriceproductionperha.(involume)canreachtheleveloflocalriceproduction.Forthepurposeofthisstudy,weestimatethatinaround4yearsbottleneckscanbeovercomeandexportablevolumescanbegrownifthereisadequatefundingavailable.HavingconsideredthesituationinTasikmalayaanditsholisticallyintegratedagri-inframodernisationplan,theAsianInfrastructureInvestmentBankhasconfirmeditsinteresttofundtherequiredinvestmentbothintheagriandinfrapartsofthisproject.MarketsandpricesTheworldmarketpriceforlocalriceisapproximatelyUS$400/T*13,000,whichequalsto5,200,000Rps/T.,whiletheworldmarketpriceforBasmatiriceisapproximatelyUS$1,000/T*13,000,equalling13,000,000Rps/T(source:RiceNews).Withlocalricebeingsoldinthedomesticmarketfor10,000Rps(0.748$)/kg,or10,000,000Rps(748$)/T.,theworldmarketpriceforexportedBasmatiriceisslightlyhigher.ProductioncostsinTasikmalayaarerelativelylowat1-1.5mlnRps(75-112$)/T.ThisfavourstheTasikmalayalocalricefarmerscomparedtofarmersinothercountries.TheserelativelylowproductioncostswillfavourpotentialBasmati(equivalent)riceproductionandexport.Tasikmalaya’sannualproductionof300,000Tlocalricecangradually(orswifterwithadequateinvestment)becomeproductionofBasmati(equivalent)rice.Withtheabove-mentionedmiller’scapacityinmind,thismeansthatacombinedeffortof1,000millerswillberequiredtoserve150,000Basmatiricefarmers,onintotal50,000haofland.Whentechnicalissuesaresolvedexportsofbasmatiricecouldbeanattractivepropositionpricewise.Theglobalmarketsforbasmatiricearealmostunlimited.Demandishigh,currentsupplyrestrictedtoIndiaandPakistanandthatisreflectedinthehigherpricecomparedtomainstreamrice.CurrentlymainstreamriceUS$400/tonandbasmatiUS$1,000-$1,100/ton.Enteringthatmarketseemstobeveryattractive.However,Basmatiisactuallyabrandnameandthesourceispartofthatbrand.Pricelevelsaredirectlyrelatedtothesourceandcharacteristics.So,themomentTasikmalayamanagestoequalthecharacteristicstotheoriginalBasmati,stilltimeisneededtogetbroadmarketacceptanceasasource–unlessthereisamajorinvestor/buyer.ArrangingspecialcontactswithspecificcountriesasOmancanattheonehandimmediatelysatisfyOmanandpossiblyGulfmarketswhilespeedingupthelevelofglobalacceptance.Finally,itshouldbenotedthatiftheshifttoBasmati(equivalent)riceisrealizedamongallcurrentTasikmalayaricefarmers,thelocalmarketdistortionmaybecomeevengreater:thepriceforavailablericemayrise,possiblyresultinginevenhigherdomesticpricesversusworldmarketprices.ThismaycausetheIndonesianCentralGovernmenttofurtheradaptitssystemofcontrolsonricedistribution/importswhileassistingfurthernation-wideagriculturalmodernisation.UpscalingproductionProductionvolumeofBasmati(equivalent)riceisexpectedtoincreasewhenthemainchallengesareresearchedandsolved.Basmati(equivalent)riceproductionandexportingwillbepossibleonlyifitcanbeproducedatthesamecostaslocalrice,andifhigheryieldscanbeachievedbysolvingthechallengesdescribedabove.OnlythenwillfarmersshiftfromlocaltoBasmati(equivalent)riceproduction.Thiswillrequirenewinvestmentsinprimaryproductionandprocessing.Thefollowupfeasibilitystudywillneedtoshowwhereandhowsuchimprovementsandinvestmentsneedtobedone.Anotherissuewhichneedstobeworkedonisthebrandingofthelocalbasmativariety.EvenifthecharacteristicsequalthoseoftheoriginalBasmatirice,thepriceinthemarketwillonlyrisefrommainstreamlevelovertime.ItisestimatedthatwithalltheeffortsmentionedcommercialproductionofaBasmatiequivalentricecancommenceafterfouryears.Withmarketacceptance

9

included(nextchapter)agradualincreaseinexportsisadvised.Ofcourse,thisisdifferentwhenthereisonegroupofinvestors/buyersthatactuallywillbenefitoftheinitiallylowprices–andwhenpricesrise,tradeintheirproductswillbecomeveryattractive.PatentingBasmatirice,marketacceptanceBasmatiriceisavarietyoflong,slender-grainedaromaticriceindigenoustotheIndia-Pakistansubcontinent.Worldmarketpricesarequotedforthisproductwherebytheoriginisimportant.EvenifasimilarricevarietyisproducedforexportinTasikmalayaitwilltaketimetogetthesameacceptanceasthePakistanandIndiansourcedvarieties.Tasikmalayasourcedsimilar(asBasmati)ricewillneedtimetobeacceptedbythemarketasbeingBasmatirice.Phyto-sanitaryissuesascurrentlywithIndiansourcedBasmatimayhelptheIndonesiancase.SotoowilldirectcontractswithOman,recognizingBasmatiricefromTasikmalayaashavingthesamequalityandfeaturesasBasmatiricefromIndiaandPakistan.PAAsiacurrentlylooksatastrategyonthepatentingaspectsofBasmatiricetobeproducedinandexportedfromTasikmalaya(seeboxbelow).Asof2014Indiaexported59%oftheoverseasbasmatiricemarket,whilePakistanaccountedfortheremainder.Conclusions:ThepatentingofbasmatiriceisprotectedasGeographicalIndicationgoodunderArticle22(1)oftheWTOAgreementonTrade-RelatedAspectsofIntellectualPropertyRights(TRIPS)as:"Indicationswhichidentifyagoodasoriginatingintheterritoryofamember,oraregionoralocalityinthatterritory,whereagivenquality,reputationorcharacteristicofthegoodisessentiallyattributabletoitsgeographicorigin”.PatentbattleIndia-US:In1997,theU.S.companyRiceTec,wasgrantedapatenton"basmatiricelinesandgrains".RiceTecfacedinternationaloutrageoverallegationsofbiopiracy.ThissituationalsocausedabriefdiplomaticcrisisbetweenIndiaandtheUS,withIndiathreateningtotakethemattertotheWTOasaviolationoftheGeographicalIndicationActundertheTRIPSagreement.BothvoluntarilyandduetoreviewdecisionsbytheUnitedStatesPatentandTrademarkOffice,RiceTeclostorwithdrewmostoftheclaimsofthepatent,including,mostimportantly,therighttocalltheirricelinesbasmati.AmorelimitedvarietalpatentwasgrantedtoRiceTecin2001onclaimsdealingwiththreestrainsofthericedevelopedbythecompany:Texmati,KasmatiandCalmati.Indianbasmatiexportersdismissthesevarietiesasbasmatiimitations.Onthisbasis,Tasikmalayamaywishtodevelopaspecialbrand,called‘Tasmati’rice.

Box1:TheBasmatipatentissueand‘Tasmati’riceConcludingonBasmatiriceproductioninaportdevelopmentcontextWecanconcludethattheexportofBasmatioritsequalfromTasikmalayaispossibleintheshort-mediumlongterm.Itrequiresajointeffortbetweenprivatechainplayersandsciencetoachievethis.PreliminaryestimateswouldsuggestthataninvestmentofUS$100,000repeatedannuallyovera4-yearperiodforfieldresearchandcommercialmultiplicationofseedwouldfindsolutionsforthecurrentlyexistingchallenges.ThemainconclusionisthatproductionofBasmati(or‘Tasmati’-equivalent)ispossible,andthattradableexportvolumescanbereachedinthemedium/longerterm.Giventhetimerequiredtogettheagri-technicalandagri-economicissuessolvedwegoforaconservativeapproachinthiscase.Seefigure1.Below.Weestimatethatone20-footcontainerof30cubicmetercantake800kgs/cubicmeter,socontains24tonsrice.Thisequalsto10,000tons.

Figure1:ExportablevolumesofBasmati/’Tasmati’(Tperannum)fromTasikmalayaarea.NotethatthiscanbeexpandedwithotherSouthernJavaneseKabupaten.

Year ExportableQ/Tons Exportablecontainers

Year1-4 0 0Year5 10,000 417Year6 20,000 833Year7 30,000 1,250Year8 40,000 1,667Year9-20 50,000 2,083

10

2.3 PotentialforcertifiedorganicriceexportForcertifiedand100%organicriceproduction(eitherBasmatiorothervarieties),aclosedfarmingsystemisrequiredtoachieveinternationalcertification.Certifiedorganicricehasthepotentialandgovernmentpermissionforexports.ToachievethisonalargescaleinTasikmalayamayrequirecooperationwithotherKabupatentoachievetherequiredvolumerathersoon.Mainissueincertifiedorganicriceproductionisthescarcityofland,asorganicproductionneedsmorelandperunitofproductionandadditionalcostsformakingcompostand(handweeding)combinedwithalimitedgatepricecompensationfortheirproduct.Forexporttheaddedissueofcertification(atacost)becomesrelevantalso.Onefarmerthatwasinterviewedproduceshisorganicriceata5ha.plot,usinga‘lowinputsystem’.Tosecuresufficientorganicfertilizer,thericeproductioniscombinedwithcattlefordairyproduction(8cowsandfollowers),whichwasprovidedforbytheGovernment.Gradingiscurrentlydonemanually,equipmentmaybeneededonceproductiongrows.Thefarmerstruggleswithproductionduetotheincreasedworkloadinfertilization,diseasecontrol,weedingandresiduecontrol,andotherfarmingactivities.Organicricesellsata30%higherpricethannormallocalrice.Accordingtomostthis30%(gate)priceincreasedoesnotcovertheextraexpenses.Certification(IMO,Swiss)ofhisriceisinthehandsoftheexporter.Themarketfororganicriceisgoodsincethereareveryfewproducers.TheTasikmalayaandnationalgovernmentstimulatesfarmerstoproduceorganicrice.Atthismoment,anestimated5%(or3,500ha.)isunderorganicproduction,andtheTasikmalayagovernmentaimstoincreasethisto25,000ha.in2020intheTasikmalayaregion.TheMinistriesofAgriculture,Environment,andVillageDevelopmentworktogetherinachievingthis.IntheTasikmalayaregion,threevillages(onethatoftheinterviewedfarmer)havebeenselectedtoserveaspilotareastoproduceorganicrice.Besidesthesepilots,villagesarestimulatedtoestablishacompany(‘villagecompany’)forfarmerstoworktogetherandfindnewpotentialto‘dobusiness’.Thequestionofthoseinterviewediswhetherfarmershavetheskillstodoso.ItmayberelevanttoatleastpartiallyintegratetheeffortsofvariousMinistrieswithapotentialholisticallyintegratedagri-infraproject.ConcludingonorganicriceexportinaportdevelopmentcontextItisadvisedtoaimfor‘healthyagriculture’production,withfocusoncreatinganimprovedenvironmentalsituation,ratherthantryingtoachieveatotalshifttowardscertifiedorganicproduction.Nevertheless,amodestexportoforganicriceisenvisaged.Weestimatethatone20-footcontainerof30cubicmetercantake800kgs/cubicmeter,socontains24tonsriceequalsto500tons.WhenincludingproductionfromotherKabupatenthisvolumewillincrease.

Figure2:Exportablevolumesoforganicrice(Tperannum)

Year ExportableQ/Tons Exportablecontainers

Year1 500 21Year2 600 25Year3 700 29Year4 800 33Year5 900 37.5Year6-19 1,000 42

11

3. Fruitandvegetableexportpotential3.1 OverviewofsectorpotentialandbottlenecksGeneraltrendOverall,thereisalargeglobalfreetradeinthefruitsector,andunfortunately,Indonesiaonlyhasaverylowanddecliningmarketshareinthistrade.Atnationallevel,thereissomeexportinpineapple,mangosteenandbananas,andtheremaybepotentialformango,orangeanddurian.Themainreasonforthecountry’sdecliningexportsisthefactthatitisproducedbysmallscalefarmerswithalowtechnologylevel,resultinginpoorquality,poorquantity,andpoorlogisticchannels.Thecountry,includingtheTasikmalayaarea,lackthemuch-neededlargercommercialproductionunitssuchasplantations.Thesearerequiredtoenterexportoffruitbyproducinghighquantities,ofhighquality,andbyusingsoundagri-logistics.Inthecountry,aswellasintheTasikmalayaarea,coldstorefacilitiesandsupportingcoldchainoperationsarelaggingfarbehind.Poorinfrastructurecreateshightransportationcosts.Qualityfruitsandvegetablesonthehigh-endmarketsinJakarta(forexamplemodernretail,hotels,restaurants)aremostlyimported.Malaysia,ChinaandThailandarekeyplayersinsupplyingthesemarketsinternationally.Structuredandsustainedinvestment,forinstancethroughagroupofinvestors/buyers,canovercometheseobstacles.Fruits:mangosteenAnexamplethatfruitexportisentirelypossibleisexactlyintheTasikmalayaregion.Mangosteenisapositiveexceptionwithapotentialforevenlargerexportthancurrentlyalreadyrealised.Ithasawell-organizedvaluechaintosupportexistingexportoftheproducts.Thelocalmangosteenfarmersareawareoftheinternationalqualityrequirementsandareknowntoadheretothis.Thelocalmarketisalsoverywellestablished.Forfruit,goodlocalmarketsoftenareasteppingstonetowardsexportgrowth.Mangosteenthereforehasmostlikelypotentialtoexpandandincreasegrowthfortheexportmarket.Althoughsnakefruitwasseenasapotentialexportproductaswell,fieldvisitsshowedthispotentialcurrentlytobeunrealistic:currentproductionlevelsaredecliningsharplyduetolowlocalmarketprices,plantedtreesproduceavarietythatisnotinhighdemand,andnoorganizedvaluechainexiststopromote(currentlynon-existing)exportsoftheproduct.Horticulture:chilipepperForcommercialvegetableproduction,theBandung-Bogorareamayshowpotentialduetoitshighaltitudes.IntheTasikmalayaregioncommercialvegetableproductionisclosetonon-existent.Thesectorshowslow,scatteredmeansofproductionthatrequiresubstantialpolicyattentionandinvestmenttomodernize.ClimateintheTasikmalayaregiondoesnotfavourproductionofhigh-valuevegetablesforexport.However,chilipeppershowedgoodpotentialforexport,witharelativelywell-organizedvaluechaintosupporthighernichemarketsinurbancentresasJakartaandthereforepotentialforexportsoftheproduct,whichdocurrentlynotyetexist.3.2 PotentialformangosteenexportProductionTheTasikmalayaregionisoneofIndonesia’skeyproductionareasformangosteenfruits.TheOctober-Novemberperiodisthemainharvestseasonalthoughthisvaries.Outsidethisperiodsmallervolumesareproduced.Itisacropthatisproducedwithgoodqualitybylocalfarmers.Currently3,800ha.isplantedwithmangosteentreesintheTasikmalayaregion.Costsofmangosteenproductionarelow,roughly15,000Rps/ha.Highaltituderesultsinbetterqualitybutlowerproductionvolumes;whilelowaltitudegiveslowerqualityandhigherproductionvolumes.OtherproductionareasinthecountryareinSumatraandBali.Ononehectare,afarmerproducesmangosteenwith100trees.Afterplantingtrees,ittakesalongperiodofeightyearstoharvest,and

12

calculationofexportpotentialisinthisreportthereforebasedonhectaresoftreesthatarecurrentlyproducingthefruit,notontreestobeplanted(potentialproduction).Thecurrentproduction,basedonanaverageyieldoverthepast5years,isbetween25,000-30,000T/yr.,ofwhich60%(roughly20,000T)isexportable.Thefarmersonlyexpandstepbystepastreestake8yearstostartproduction.Tasikmalaya’smangosteenproductionandexportiscentralizedaroundthevillageofPuspahiang.Thevillageandsurroundingareahasmanagedtousethisnameasacurrentlywell-knownbrandnameforTasikmalaya’smangosteenexports.Thevillageisaskedbytraderstosupplyitsprofessionalsorterswhencollectingthefruitinotherproductionareasaswell.PricesThelocalqualitysellingpriceis25,000Rps(1.87$)/kg.,whilethatoftheexportqualitysellingpriceis43,000Rps(3.217$)/kg(today’sprice).Thiscanriseto60,000Rps(4.49$)/kginthehighmarketdemandseasons,suchasduringtheChineseNewYear.Onaveragetheexportpricerangesbetween30,000-50,000Rps(2.245-3.742$)/kg.Annualproductionlevelsperha.alsofluctuate(from1,300to3,000kg/ha.),whichiscausedbydifferencesinsunhoursandrainfall.Asaneffect,Tasikmalayaproductionseasonalsofluctuates,fromtheperiodOctober-DecembertotheperiodJanuary-March.MarketsAsaresultoffluctuatingproductionseasons,theexportmarketwindowchangesaswell,whichisacomplicatingfactorforexport.TheexportmarketsforTasikmalaya’smangosteenare:Thailand,China,Taiwan,U.S,France,U.K.,andNetherlands.90%ofshipmentsaredonebysea,andonly10%byair.OfthecurrentTasikmalayatotalproduction,andbasedonselectiononquality,40%isdestinedforthelocalmarketand60%fortheexportmarket.Shelflifeisanimportantissueandcanbemaximum2-3weeksifproperlystored,whichmeansthatefficientcoldstoresolutionsarerequired.DirectaccesstotheendmarketisaproblemforTasikmalayafarmers.Thechangingproductionwindowisaseriouschallenge.AwindowintheperiodDecember-January,coverstheChineseNewYearwhenpricesarehighest.Summarizing:volatilityinthegatepriceforthefamersiscausedbychangingproductionlevelsaswellaschangingharvest/marketwindows.UpscalingproductionAccordingtotheTasikmalayaAgricultureOffice,the‘potentialhorticulturearea’thatcanbedevelopedintheTasikmalayaregion,includingformangosteen,is26,000hectares.Currentlyonly3,800isplantedwithmangosteen.Thismeansthattheoreticallythepotentialforfurtherdevelopmentoftheproductis22,200ha.Butformangosteenproductionthetimebetweenplantingtreeandfirstharvesttakeseightyears.Whenproductionstartsinyear8theharvestisonly5kg/tree;fromyear8-10thisgrowsto10kg/tree;fromyear10-15to20-50kg/treeperyear;andfinally,fromyear15-20agoodharvestof100kg/treecanbeachieved.Thismeansthatmangosteenproductiondevelopmentisalengthyprocess.Forthisreport,theconsultantthereforeonlycalculateswithcurrentexistingproductionlevels.Costsofdevelopingnewmangosteenproductionareasfollows:inyear1costsincludeseed(50,000Rps(3.742$))andlabour(5,000Rps(0.374$))pertree,andvariablecostsof10,000Rps(0.748$)/hainyears1-5.Fromyear6onwards,productioncostsarelow,at15,000Rps(1.122$)/ha.ConcludingonmangosteenexportinaportdevelopmentcontextCurrentexportproductionisupto20,000Tperyear.Increasingthesevolumesisaveryslowbutisdonebythefarmersstepbystep.Currentproductioncanbeexpanded.Yetevenifinvestmentsinsuchexpansioncanstartimmediatelyitwilltakeeightyearsbeforeanyproductionincreaseofmangosteencanbereached.Weestimatethatone20-footcontainerof30cubicmetercantake600kgs/cubicmeter,socontains18tonsmangosteen.So,500tonsequals28containers.

13

Figure3:Exportablevolumesofmangosteen(Tperannum)3.3 PotentialforchilipepperexportProductionTheTasikmalayaregionisoneofIndonesia’smanychilipepperproductionareas.Totalcurrentproductionintheregionisabout1020hectares,whichshouldtranslateto14,560Tofredchillies.Itisproducedbyprivateindividualfarmersworkingingroupsandsellingtheirproducetomiddlemen.MostchilipeppersaregrownlikethatinIndonesia.Onehectareredchilipepperholdsabout18,000plants.Eachplantbearsabout0.8kgpeppers,resultingin14Tfreshproductsalesperhectare.Theplantsaregrownunderplasticgroundcovertokeepmoistureinthesoilandpreventweedsfromgrowing.Theseedsareplantedinpolybagsandafter20daysbeenputinthefield.After100days,thefirstcropcanbeharvested.Harvestisdone12times,afterwhichtheplantisdestroyed.Thefarmersrotatewithoneseasonofcabbageproduction,afterwhichthepeppersarere-plantedagain.Thewholechilipepperproductioncycletakesabout184days.Thefarmproducesallyearround.Thecostpriceofproducingchilipeppersis100mln.Rps(7,480$)/ha.MarketsandpricesThedistrictofTarajuhasabout150-200hectaresofchilipepperproductionintotal.Thefarmthatwasvisitedoperateson5hectares.Itispartofthe5-villagesfarmergroupstructure,with11farmergroupsintotal.ThetotalproductionforthechilipepperproductionvillagesinTarajuisabout2,450tonsperyear.Thecurrentgatepriceis9,000Rps(0.673$)/kg.forgreenand16,000-17,000Rps(1.197-1.272$)/kgfortheredchilipeppers.Calculatedperhectare,afarmersellsitsredchiliproducefor230mln.Rps/ha.Withtheproductioncostof100mln./ha.,itgeneratesaprofitof122mln.Rps/ha.(oraroundUS$9,500).Theproduceistransportedbythefarmertoacollectionpoint,whereitisputin35kgboxesandtransportedtoJakartatobesoldinthemainmarket.Theoverallqualityisseenasgoodenoughforexport,althoughitcurrentlylackscertification.Anestimated2,000-3,000T/monthoffreshchilipeppercanbeexportedbycontainerinafewyears,whilecontinuingtoservetheJakartamarketaswell.Theareaundercultivationhasthepotentialtobescaled.Theproductionisevenlydividedoverthemonthssonorealproductionpeaksexist.Farmsandproductionwillhoweverneedtobecertified.UpscalingproductionTorealizethepotentialupscaling,technicalskillsneedtobeimproved.Currentlyrotationpracticesaretootight,anditshouldincludemoredifferentcropssuchaslegumeorpulses,andleafyvegetables.Thecurrent2-cropsrotationisnotgoodenoughanditisadvisedforpepperstohavea1:4or1:5rotationonthesamespot,toavoidnematodesaswellasfungiandbacterialdiseasestodevelop.Throughgoodcoordinationthesechallengescouldbeovercome.Anotherchallengeiscertificationoftheproduceforexport,requiredtoenterinternationalmarkets.TheTasikmalayaAgricultureOfficeisadvisedtopickuptheroleoflaunchingatechnicalassistanceprogramforchilipeppergrowingtoimprovelong-termviabilitythroughrotationandcontrolleddiseasecontrol.

Year ExportableQ/Tons Exportedcontainers

Year1 500 28Year2 600 33Year3 700 39Year4 800 44Year5 900 50Year6-19 1,000 56

14

ConcludingonchilipepperexportinaportdevelopmentcontextFreshchilipepperisapotentialexportcropifmanagedwell.Properpacking,handlingandshippingneedstobeviable.Currentproductioncanbeexpanded.Anestimated2000-3000T/monthoffreshchilipeppercanbeexportedbycontainerinafewyears.Weestimatethatone20-footcontainerof30cubicmetercantake300kgs/cubicmeter,socontains9tonschillies.So,500tonsequals56containers.Year Volumeexported Numberof

containersYear1 500ton 56Year2 1,000ton 111Year3 1,500ton 167Year4 2,000ton 222Year5-10 2,500ton 278

Figure4:Exportablevolumesofchilipeppers(Tperannum)3.4 PotentialforteaexportPlantationsTotallandunderteaproductioninTasikmalayaisabout11,000hectares.Therearetwomainproductionactors:privateandgovernmentplantations,andsmall-scalefarmers.DuringthefieldresearchtheprivateSinarInescocompanywasvisited,whichoperatestwoteaplantationsintheTasikmalayaregion:theSambawaplantationof750ha.andtheSatriaplantationof450ha.Thisbringsthetotalproductionareato1200ha.,withanaverageproductionofdryteaof1500kg./ha./year.ThecompanyhasanothersixplantationsinJava,farfromtheTasikmalayaregion.About30%oftotalproductisdestinedforexports.Theproductionunitvisitedfeltthatthenewportcouldbeusedforexportsofthisproduce.However,itwasoverlookedthatfurtherprocessingandblendingofthedryteaisdoneinJakarta.Anexpert-visittothemarketingofficeofSinarInescoinJakarta,provedthatforthislogisticreasonthecompanyhasnointerestinexportingfromCikalong.ConsolidationtakesplaceinJakarta,andteawillbedistributedandexportedfromthere.Thisisthepositionofmanyindustries,eveninTasikmalaya,becauseoftheirexistingsometimesprivilegedpositionsinJakarta’sheavilyburdenedtransportnetworks.Itmustbeassumedthat–assoonasthereisanalternativeandprofessionallyoperatedportinTasikmalayawithlotsofspaceallusersofportinfrastructurewillreconsidertheirlogisticaloptions.Small-scalefarmersAnother9,800ha.underteaproductioninTasikmalayaisproducedbysmall-scalefarmers.TheTarajusub-districthasintotal4villagesand15farmergroupsthatproducetea.Eachvillagehasabout100-150hectaresforteaproduction.Oneofthese15groups,whichwasvisitedatRaksaTani,hasitsownteafactory.Theproductionisestimatedat700kgdrytea/ha./month.Thegrouphas30teafarmermembers.Around40%oftheproductionisfullyprocessedandpacked,therestisdriedandsendtothelargerfactories.Productionpergroupisabout1Tfreshtea/day,or250kg.finisheddriedtea/day.Consolidationofthisteaandprocessingitatajointplant(whichrequiresinvestment)wouldresultinexportablevolumesofgoodqualitytea.TheRaksaTanigroupcurrentlyhasteaoutlets,includinghighqualitybrandedandpackagedteaproducts.Ajointoperationwiththeothergroupsunderitswingsisseenasfeasible.CurrentlydriedteafromallothergroupsissenttoSukabumi(90%)andSurabaya(10%),whereitisprocessed/blendedbyteaprocessingcompanies,whothenselltolargeteacompaniessuchasWalini,Sosro,2Tang,Gopek,andPoci.

15

RequiredinvestmentThefarmersgroupshavescopeforexportifaninvestmentcanbemadeinaconsolidatedteafactory,whichalsomeansthedifferentfarmergroupsneedtoworktogether.Itisestimatedthatforthe9,800Ttocomeavailableforexport,aninvestmentinafullyequippedfactoryneedstobemade.Roughly,thefinancingrequiredwouldbeasfollows:3,000mln.Rps(US$225,000)forbuilding;14,000mln.Rps(US$1mln.)formachineryandequipment;and125mln.Rps(US$9,500)forwages.Thisbringsthetotalinvestmenttoroughly17,000mln.Rps(US$1.27mln.).ConcludingonteaexportinaportdevelopmentcontextTeaproducedbysmallfarmerscanbeexported.Itisenvisagedthatitistakenupgraduallyandthatfurthersurveyisneededintheviabilityofaseparateteafactorywiththeaimtoexport(toOman)Itisexpectedthattheuptakeoftheungradeddriedteaisdoneupgradually.Anestimated5,000ton/monthofprocessedteacaneventuallybeexportedbycontainerinafewyears.Weanticipateagradualincreaseasprojectedbelow.Weestimatethatone20-footcontainerof30cubicmetercantake200kgs/cubicmeter,contains6tonstea.So,1000tonsequals167containers.year Volumeexported Numberof

containersYear1 1,000ton 167Year2 2,000ton 333Year3 3,000ton 500Year4 4,000ton 667Year5-10 5,000ton 833

Figure5:Exportablevolumesoftea(Tperannum)3.5 PotentialforbambooexportGeneralcontextBambooisoneofthenon-timberforestproductsthathavepotentialtosubstitutewood.Withtheadvancementoftechnology,bamboocanbemadeintoseveralproductslikebuildingmaterial,bamboofloorsandwallsandtextiles.Inaddition,itisusedfortoothpick,satesticks,chopsticksandawidevarietyofhandicraftsandfurniture.Somevarietiesareeatenasavegetable.Itiswidelyseenasanextremelyversatileproductwithlargepotentialglobally,andwithabroadavailabilityinTasikmalaya.Withthedepletingglobalavailableforestpotential,bamboowillplayanincreasinglyimportantrole.However,peopleinTasikmalayaaregenerallynotawareofthevalueofbamboo,whileinfactitisgrowingeverywhere.Bamboocanbemultipliedeasilyandmatureswithinayear,sogrowsveryfast.However,mostpeopleprefergrowingAlbesiatrees,whichcurrentlyhasabettermarketthanbamboo.ProductionProductionpotentialisalmostlimitlessintheregion.Itisestimatedthatevenwithoutanestablishedformalmarket3.7millionstemsarereadilyavailable.Incaseofacommercialdemand,thisquantitycanbeincreasedwithlittleeffortbythefarmers.Suitablevarietiescaneasilyreplacethelessusefulvarieties.ItcanbegrownundercontractaswellasbyestablishingprivateorGovernmentplantations.Thevarietieswhichgrowintheregionandarespecificallysuitableforindustrialuseare:Bambutali,whichisusedforsticks,chopsticks,toothpicksandsatesticksforlocaluse;andBambugombongandBambubitung,whicharesuitableasrawmaterialforfloorsandwallsandotherbuildingmaterial.Thesevarietiesarewidelyavailableandcanbemultipliedbytakingcuttingsfromtheexistingwidelyavailablesuitablestock.However,atthemoment,thereisnorealinterestamongproducersasthe(local)marketislimitedtouseforfencingandlocalbuildingconstruction.Anewlydevelopedbamboo-basedindustrycanbeinstrumentalincreatingalargebio-

16

basedindustrywithhugepotentialfromallangels.Supplyoftherawmaterialscanbearrangedbycontractingfarmerstogrowtherightvarieties,aswellasbydevelopingcommercialplantations.Yetinvestmentintechnologyisrequiredtomakerealvalue-addedmaterialslikefloorandwallsfortheconstructionindustry,satisfyingthegrowingdomesticdemandaswellasthegrowingglobaldemand.Nevertheless,thisindustrydoescurrentlynotyetexistinthewholeregionofWest-Java.Meanwhile,upstream,oneofthelargestbambooplantsproducersintheworld,OprinsfromBelgium,hasconfirmeditsinteresttoassistarapiddevelopmentofbambooplantations(http://en.oprins.com).ThegloballyactiveInstituteforBambooandRattaninBeijinghasagreedtoassistwithresearchintothechoiceforbestperformingbambooplantsfordifferentpurposes,rangingfromhighgradefood(basedonbambooshoots),toconfection,tomanufacturedhouseholdproducts,tosustainablebuildingmaterials,tobio-energy.ThePortnearCikalongintendstoconstructallfacilitybuildingsof(locallyproduced)bambooconstructionmaterialswheretechnicallypossible.ConcludingonbambooexportinaportdevelopmentcontextTheproposedbamboofloorandwallsindustrycanmakeuseoftheprospectiveportdevelopmentthroughexportingtheproductbyseafreight.Anestimationisprovidedbelowontheexportablecontainersifthisisrealized.Inthesecalculationsone20-footcontainerof30cubicmetercantake1,000kgs/cubicmeter,socontains30tonsbambooflooring.So,10,000tonsequals333containers.year Volumeexported NumberofcontainersYear1 10,000ton 333Year2 20,000ton 667Year3 30,000ton 1,000Year4 40,000ton 1,333Year5-10 50,000ton 1,667

Figure6:Exportablevolumesofbamboofloorsandwalls(Tperannum)4. Concludingonpotentialexports4.1 ConsolidatedexportsinaportdevelopmentcontextConcludingonpotentialconsolidatedexports,itisexpectedthatfromyear1oftheport’soperationcontainerexportscanbegin.Thiswillbeatarateof12containersaweekatthestartandwillincreasetoalmost5,300containersinyear10(or100containersperweekinthatyear).Notethatthecontainersformangosteenandchiliesmustbereefercontainer.Indicativeratios(dependingonpackagingmaterialused)forcalculatingthenumberofcontainersareprovidedinfigure7below.Figure7:Ratio’susedtocalculatethenumberofcontainersAsummaryofpotentialconsolidatedexportsofresearchedagricultureproductswithhighexportpotentialintheTasikmalaya,calculatedinnumberofcontainer,isprovidedbelow.Thistable

Ratiosusedforconvertingtonstocontainers.Rice 800kgspercubicmeterBambooflooring 1,000kgspercubicmeterTea 200kgspercubicmeterChili 300kgspercubicmeterMangosteen 600kgspercubicmeter

17

excludesexportsoffruitsandvegetables(suchasbananas,mangos)thatmaybereachedthroughsubstantialinvestmentsincommercialproduction.

Figure8:ExportablevolumesfromtheTasikmalayaarea,consolidated(Tperannum,containersperweek).WecanconcludethattheprospectofexportofagriculturecommoditiesfromTasikmalayaonlythroughthenewlydevelopedportofCikalongisratherlimited.Asdescribedinthisreport,thereispotential,especiallywhenincludingvalueaddedproductssuchasbambooflooringandwalls.ItcanalsobeconcludedthattheeconomicjustificationfortheportshouldcomebothfromthehinterlandofgreaterBandungwitharound9millioninhabitantsandlargevolumesofindustrialexportandimport,andfromagri-importsforthewholeregion.Confiningourselvestoagriculturecommoditiesandproducts,theimportofdeficitcommoditiessuchaswheat,soya,andcattlehasahigherpotentialtojustifyinvestmentsintheportthanexports.Thisconclusionrequiresfurtherstudy.ThenextchapterprovidessomeinitialfindingsonpotentialimportsthroughCikalong.5. Importpotential5.1 PotentialforlivestockimportSituationanalysisTheholdinggroundofPTAgro-InvestraissituatedontheroadbetweenTasikmalayaandBandung.ThecompanyisoneoftwocompaniesimportingcattlefromAustraliainWest-Java.PTAgrocurrentlyimports7-8shipmentsof2,000cattleeachthroughtheportofCilacap,andthentrucksthecattletoitsholdingground,fromwhereitisgraduallydistributedtoslaughterhousesinBandung(40%)andTasikmalaya(60%).ThevolumeofthroughputdependsonGovernmentimportlicencesandsupplyoflocalcattle.TheGovernmenthasplanstoencouragelocalcattleproductionandiscurrentlysqueezingthemarkettoencouragelocalfarmerstobreedmorecattle.Themeatpriceisstable,asitisGovernment-controlled.Nolargefarmsproducesubstantialvolumesofcattleyet;mostproductionisdonebysmallfarmers.LackoflandinJavaisseenasakeyissuetodevelopproduction.Governmentcompanieshavelittlesuccessincommercialproductioneither.Withtruckingfromthecurrentporttothecompany’sholdinggroundtakinguptotenhours,itseesaportinCikalongasaveryinterestingdevelopmentandimprovementforbusiness.Thecompanyimported30,000headsofcattlesomeyearsago;thisisnowdowntoabout16,000.Totalimportfromthiscompanyandtwoothersisestimatedtobe50,000heads.DemandinJava(andIndonesiaasawhole)issubstantiallylargerthancurrentsupply.WiththeGovernmentpurposelylimitingimportlicencesforcattle,mostlyfromAustralia,tostimulatelocalproduction,investmentsinfeedlotsandbreedingcattlewillbestimulatedbyGovernmentintheyearstocome.

18

Fortheimportofcattlespecialfacilitiesareneeded.Theyareimportedinbatchesof2,000headsperspecialship.Thecurrenttotalimportof50,000headsofcattlewouldimplyanimportofonebatchof2,000headsofcattleeverytwoweeks.Itisadvisedtofurtherinvestigatethesevolumes,aswellasthepossibilityofprocessingtheanimalclosertotheport–totransportprocessedmeatinlandratherthanlifeanimals.ThiswouldalsoimplyinvestingincattleholdinggroundsnearthenewportofCikalong.5.2 PotentialforothercommoditiesimportTheflour(wheat)millingindustryinIndonesiaexpandedatarateof5%inthe2016-2017period.Thereareabout31millsinoperationin2017,withaninstalledcapacityofapproximately11.4millionT(alsocateringformaize).Currentlytheyoperateat85%capacity,and3millsarecurrentlybeingupgraded.Thetotalinstalledcapacityisexpectedtoreach14.2millionT.The2016-2017wheatimportsareestimatedat9.9millionT,andtogrowata5%rateannually.WheatcannotbecommerciallygrowninIndonesia.Itisslowlydisplacingriceandcornfromthedailydiet.By-productsofthemillingprocessareusedinlivestockfeeds.Thelivestockfeedindustryisalsogrowingrapidly,mainlyforproductionofpoultry.If5%oftotalwheatimportswouldbeallocatedtotheCikalongport,approximately500,000Tcouldbeimportedthroughtheport.Itisfurtherestimatedthatalmost2.6millionTofsoyaseedisimportedinIndonesia,orabout70%ofthetotallocaldemand.Iftheportwouldbeallocated5%,thiswouldmeanthatavolumeof130,000TwouldbeimportedthroughtheCikalongport.Importsofmaize(corn)arealsoincreasingrapidlyovertime.Itmustbenotedthatspecialfacilitieswillneedtobebuilt,sincewheat,soyaseedandmaizearemostlyhandledinbulk.Thiswouldrequirespecialconveyorsandstoragesilo’s,tohandleunloadingandstorage.Thetrendisclear:agrowingdemandforwheat,soyaandmaizewillincreaseimportsoftheseproductsinthenear,mediumandlong-termfuture.ThisofferssubstantialopportunitiesfortheCikalongport,withhandlingandmillingfacilitiesattached.Importingandhandlingofwheat,soyaandmaizecanalsobeatthebaseoflocalmillingandaseriouslivestockfeedindustry.5.3 PotentialforanintegratedagribusinessparkapproachTheconsultantsseelargepotentialtodevelopanintegratedagribusinessparkatorneartheCikalongportfacility,combiningtheimportsofcattle,wheat,maizeandsoyawithaddedvalueindustriessuchasbreedingandfatteningcattle,grainstorageandmilling,livestockfeedprocessing,fisheriesandhighvaluefishproducts,andpoultryfarmingandprocessing.AlltheseactivitiescansupplythegrowingurbancentresofBandungandTasikmalayainthelong-termfutureandreleasecongestioninJakarta.Whereeconomiesgrow,thedemandforanimalproteinsincreasestoadis-proportionallylargeextend.ThisisreportedlyalsothecaseinIndonesiaregardingpoultryconsumption,alreadyresultinginarapidlygrowingpoultryindustry.ItseemsveryrealistictohavealargeholdinggroundforcattleneartheCikalongport,includingslaughterhousefacilities.Iflandisavailable,breedingandfatteningcouldbedevelopedinlinewiththeGovernmentpoliciesdescribedabove.Wheat,soyaandmaizeimportsthroughCikalongwillstimulatethedevelopmentofalocalmillingandhandlingindustry.Alivestockfeedmillcouldservetheneedsforthebreedingandfatteningunitsaswellasformabaseunderapoultryindustry,includingfarmingandprocessing.Approximately70%ofthepoultryproductioncostsisfeed,makinganintegratedapproachmoreviable.Besidesthesuggestedagribusinessparkapproach,otherexpertresearchconcludedonthepotentialforamodestyetadvancedfishingportharbouringmodernfishingships,thatcanbebuiltnear

19

Cikalong,whilefurtherexpansionofhighgradeshrimpproductionsuchasinEcuadorwithmajorinvestmentsofdomesticandforeigncompanies,suchasfromPT.JuraganKapalIndonesia(page93,OurJointBrainsbrochureinthelinkbelow)willfurtherenhancethelongtermviabilityofCikalongPort.Moderncoldstore,deepfreezing,packaging(3Dprintingbio-downgradable)andotherlogisticalfacilitieswillbeabletocompleteabamboo-basedlowenergy/lowemissionportfacility(see:https://drive.google.com/open?id=13Y4eecPrlViIQNLEYorSytdjTH8iqnM6).Anagribusinessparkwillbefeasibleifforeseeninfrastructuredevelopmentstakeoff,namelyintheBandung-Cikalong4laneshighway,investedin,managedandoperatedbytheSpecialPurposeVehiclewiththeequityanddebtfundingoftheAsianInfrastructureInvestmentBankandothers.6. Otheraspects6.1 ProposedusufructapproachBelowfollowsadescriptionontheusufructapproachasproposedbyearlierresearch(seepage3),whichwillbeatthebasisofincreasingtheagriculturalproductionintheTasikmalayaprojectarea.Usufructisdefinedas‘thelegalrightofusingandenjoyingthefruitsorprofitsofsomethingbelongingtoanother’(Marriam-Webster).TheproposedapproachwillneedfurtherresearchtobeappliedtoTasikmalaya.TheconceptisalreadyusedinDuqm,SultanateofOman.Researchdonesaysthat“thepotentialusufructapproachfortherelationshipbetweenforeigninvestorsattheonesideandlocalfarmersandKabupatenTasikmalayaattheotherhandisdestinedtocreatealongtermbalancedandfaircontract-baseddivisionofroles,benefitsandincomebetweentheinvestorsandfarmers.”BasedonTheSultanateofOmanexperienceandresearch,theproposedusufructapproachcanfunctionasfollows:“Theusufructmulti-yearGovernmentsupportedcontractallowsmultimillionUSDforeigninvestmentinsoil,integratedpestmanagement,watermanagement,educationandtraining,(bio)packaging,logistics/road/portdevelopmentforIndonesianactorsattheonehandandamajorityvolumeofharvestsforthe(foreign)investorsattheotherhand.Thisdivisionofharvestswillbebasedonindependentvaluationofinvestmentsandharvests.Theusufructagreementwillbemultiyearandpreferably30-50yearsfordebtandincomeforallpartiestoproperlymature.TheIndonesiantraditionalwordforasortofbartertradeorlendingwithoutinterestpaymentsandwithpaybackinmaterialsratherthanmoneyis‘bagihasil’.Thiswordwillcontributebetterunderstandingoftheusufructagreement.Theusufructagreementmayincludethefollowingelements:forthelandowners/farmers/authorities:amodestleaseoflandprice;anadequatewageforworkonland;apremiumsellingof‘thefarmers’partofsafeororganicharvests(around20%?)forlocalJakarta/Bandung/Surabayasales;investmentinland(watermanagement,equipment,educationandtraining);fortheinvestors:around80%(dependingonindependentvaluation)oftheharvestswithoutanyfurtherpayment.Thefarmerscanselltheirhigh-value(safe/organic)productstodomesticmarketsand/ortointernationalmarketsnotcoveredbytheinvestorstoavoidunnecessaryandunwantedcompetition;Thefarmersarestimulatedandassistedtoestablishorstrengthenexistingcooperatives;thesecooperativesmaybecomeshareholdersintheSpecialPurposeVehicle2whichconcentratesontheentireinvestmentinandmanagementoftheagri-modernisation.Thecooperativesarethe‘clearinghouses’forworkcoordination,educationandtraining;theyaretheon-the-groundcontactpointsfortheagri-expertsatUniversitySiliwangi/UMTAS(Muhammadiyah’sregionaluniversity)whowillprovideeducation,adviceandassistancetothecooperativeswhenandwhererequired.TheexpertsattheUniversitiesareconnectedtoanAgriAppGrouprunby(andalreadyagreedtoby)Telkomsel–thisallowsearlywarningandadequateresponseagainstpests’outbreaksetc.Themechanisationoftheagricultureandacover-allagri-educationimprovementprogrammewillthinoutthetoohigh

20

numbersoffarmersinTasik(around80%workinginordependentonagriculture).Thoseleavingagriculturecanfind(betterpaidandhighervalue)jobsupthefoodvaluechain.”6.2 Nextstep:environmentalimpactanalysisandCSR(basedonsocialimpactanalysis)Currently,theareaaroundCikalongisrural,witharelativelylowpopulationdensity.Mostpeoplelivethequietyetunderperforminglifeoftheruralareas,havelittleknowledgeandappreciationfortheoutsideworldandacceptunnecessaryhighinfantmalnutrition,deaths,under-educationandunderperformance.NearlyallaretraditionalMuslimsandfirmlyusedandattachedtotheirwayofliving–butsomewhatcuriousaboutabetterlife.Thisisparticularlytrueforthealreadybetterequippedfarmers’cooperatives.Theprospectedconstructionandfunctioningofaseaport,includingitspossiblemanufacturingandproductionindustries,willhaveconsiderableimpactonsocial-cultural-religiousaspectsofsociety,aswellasonthenaturalenvironment.Althoughtheportandaccompanyingindustrialisationwillprovidejobsandeconomicprosperity,therewillalsobenegativeperceptionsthatcomewithit.Nexttotherequiredenvironmentalimpactanalysisasocialimpactanalysisshouldbecarriedoutbeforeembarkingontheactualproject.ThismaywellleadtotheinclusionofeffectiveCorporateSocialResponsibility(CSR)approachesbytheinvestorsandinvestingindustries.6.3 Includesmall-scalefarmerprojects:exampleofpalmsugarAsagreedduringahigh-levelroundtableconferencein2017,anewTasikmalayaAppPlatformwillbelaunched,supportedbyTelkomsel,tointegratedevelopmentoffourfocalfields:agriculture,infrastructure,andeducationmodernisation,andthecombattingofmalnutrition.Action-orienteddevelopmentactivitieswillbecoordinatedthroughaholisticallyintegratedmulti-stakeholderapproach.Eachfieldwillbeallocatedthreeconcretepilotprojects.(see:OurJointBrains,https://drive.google.com/open?id=13Y4eecPrlViIQNLEYorSytdjTH8iqnM6)Inthelightofthisinitiative,andoftheforeseensocialimpactoftheport,agriculturedevelopmentprojectsaimedattheruralpopulationwillbeidentifiedandinvestedin.Theseshouldaimatbringingeconomicprosperitytolargenumbersofruralpeople.Theconsultantszoomedinononepotentialagri-development/organisingfarmersproject.Palmsugarisderivedfrompalmjuiceofsomepalmvarieties.Thejuiceistappedfromasproutandcollectedbythefarmer,whoboilsituntilthickandthepointwhereroughly30%oftheoriginaljuiceisleft.Itisthenprocessedintosmallblocks,orgrindedintosugar.Besidesotheruses,itisusedasasweetenerincoffeeandtea.Its’industrialuseistosweetenKecap(soyasauce)intoKecapmanis.Goodvarietiesofpalmtreescanproduceupto50litresofpalmjuiceperday(with30%sugar).TheTasikmalayalocalGovernmentcurrentlyaimstofurtherdevelopthepalmsugarbusiness.SeveralareasinTasikmalayaproduceit,suchastheCalamegavillage.Herefarmersproduceabout30T/monthofgrindedpalmsugar,and50T/monthinblocks.Theproductcoulddevelopwellifthefarmersgetaccesstotechnicalassistanceandreceivebetterfinancialrewards.Inthecurrentsituation,middlemencollectthesugarandfarmersreceivelittlefinancialgainsfortheirproduct.Aprojectcouldfocusonmakingpalmsugarsyrup,aproductthatapparentlyhashighdemand.AprocessingplantwillcostRps200billion(15mln.$).Besideslocalconsumption,itisalsoadvisedtotestpalmsugarproductstoanOmaniexpertasitmayhavepotentialforexportstotheGulfmarket.Inthecontextofthehigh-levelroundtableconference,furtherresearchcanbedonetodevelopaconcretepilotprojectonupscalingpalmsugarprocessingundertheAgriculturemodernizationfieldoftheintegratedapproach.

21

Annex1: Productionareasandlocationsofexpertinterviews

22

Annex2: Expertinterviewlist- AgricultureDepartmentofTasikmalayaRegency.WithMr.MohammadZen,Headof

Department,atKompleksGedungBupati(Gebu)Kabupaten,Tasikmalaya.Present:Mr.MohammadZen,Mr.Pepi,Mr.Caca,Mr.Ishak,Mr.Sukayat,Mrs.Nining,Mrs.Asri,Mr.Eman,Mr.Tiya,Mr.Budi.Mr.UnangAtmajaofUNSILalsopresent.

- Ricemiller,atLeuwiSariSingaparna.WithMr.Hamid,owner(082218661973),membersof

Farmergroup,KelompokPusakaTani.- OrganicRiceFarmerCommunity,atCisayongTasikmalaya.WithChairmanH.Aleng,membersof

FarmergroupofWangunSari.- Mangosteenplantation,atPuspahiang.WithChairmanMr.Supena,FarmergroupArthaMukti.

FollowedbymeetingwithMr.EnasAnugrah,mangosteencollector.- Chilipepperplantation,atRaksasari,Taraju.WithChairmanMr.AjiMamun,membersofFarmer

groupPemudaTaniMekar.

- TeaPlantationSambawa,atTaraju,ownedbySinarInesco,WithGeneralManagerMr.Edi,andProductionManagerMr.Andi.

- TeaFarmerGroup,atTaraju.WithChairmanMr.Ena,membersofFarmerGroupRaksaTani.

- AgricultureDepartment(SiliwangiUniversityTasikmalaya),meetingwithtwoagriculture

experts.

- SheepfarmLTM(LumbungTernakMasyarakat)AksiCepatTanggap,atCintabodas-Culamega.WithChairman,Mr.Rosman.

- BambooPlantation,atCulamega.Variousbambooexperts.

- PalmPlantation,atCikuya-Culamega.WithChairmanMr.Diditwandito,membersFarmergroup

TaniMakmur.- Handicraftproductionfacility,MendongKCraft,atManonjayaTasikmalaya.Withowmer,Mr.

AsepBarnas.- Snakefruitplantation,atDesaMadyasariDusunSukaharjaCineam,Tasikmalaya.WithChairman

Mr.MamanRuhiman,membersFarmergroupSugihMukti.

- LivestockfeedCitraAgroBuana,atWado-Sumedang.WithPICMr.Supriatna.

23

Annex3: CVsofHansNijhoffMScandSierkPlaatMSc,expertsthatcarriedoutthisresearchCVHansNijhoff1. PERSONALDETAILSNationality:DutchCurrentBase:Loosdrecht,NetherlandsCompany:PioneersConsultingVOFWeb:www.pioneers-consulting.comEmail:hans.nijhoff@pioneers-consulting.comTel:+31651232523

2. PROFESSIONALSUMMARYHansisaprivatesectordevelopmentexpert.Hiskeyfocusisonguidinginvestmentsinagribusinessthatresultinmaximumdevelopmentimpact.Inthiscontext,hehasnearly20years’experienceinthefieldsofvaluechainanalysisanddevelopment,agribusinessfinanceandtradedevelopment,andagribusinessincubatorprogramdesign.Hehascarriedoutnumerousassignments,mainlyinEastAfrica.HerecentlyreturnedfromTanzaniaafterathree-yearpostingtoestablishandrolloutanagri-SMEbusinessclubinsixcountries.BesidesEastAfricaheheldlongtermpositionsinIndonesiaandEgypt.Early2017heestablishedhisowncompany,PioneersConsulting.Asindependentadvisor,heworksforvariousclientssuchasbusiness,government,knowledgeinstitutes,andinternationaldevelopmentorganizations.Hehasdevelopedstrongprojectformulation,teamleader,andrapporteurskills,andisaneasy-goingcolleaguewithagoodsenseofhumor.HansholdsanMScinagriculturalmarketingsystemsfromCranfieldUniversityintheUK.3. PROFESSIONALEXPERIENCEDirector,PioneersConsulting(April2017–present)Variousassignments:

• MappingofnewandplannedinfrastructuredevelopmentsinTanzania(road,rail,airandport),andinthiscontextscopingofinvestmentandtradeopportunitiesforDutchagri-logisticcompanies.FortheDutchMinistryofEconomicaffairs.2017-ongoing

• TechnicalassistancetotheDutch-fundedPotatoSectorDevelopmentCentreinTanzania(5-yearprogram).CoordinatingtheprivatesectordrivenB2Bactivities,withDutchinvestorsandTanzaniancompanies.ForWageningenUniversity,PPO.2017-ongoing

• Technicalassistanceindevelopinganinvestmentproposalforanagri-parkandagri-incubator,includingduediligenceassessmentsandbusinessstrategydevelopment.FortheAgriculturalBusinessInitiative(aBi),privatesectorinvestmentfund,Uganda.2017

• Technicalassistancetodevelopandholdatrainingcourseforprofessionalsfromtheacademia,businessandgovernment,onstimulatinginnovationandentrepreneurship.AtKumasiUniversity,Ghana.ForMaastrichtSchoolofManagement.2017-ongoing.

• Agribusinessdevelopmentasdriverforgroundwaterpreservation.DevelopingandtestingamodelthatoptimizesintegrationofwaterpreservationandwaterusagebyagricultureandagribusinesscompaniesinLebanon.ForAcaciaWaterBV.2017-ongoing.

24

Programdirector,AfricaAgribusinessAcademy,Tanzania,(2012–2016)BasedinTanzania,forWageningenUniversity.Varioustasks:

• Designandimplementthe5-yearstrategyforscalingtheAAAprivatesectorprogramintoaleadingregionalbusinessclubnetworkof350localagribusinessSMEcompanies

• EstablishlegalentitiesinKenya,Uganda,Tanzania,Malawi,Rwanda,Ethiopia;hireandtrainlocalstaff,implementfinancialmanagement,M&E,andreportingsystems

• Developandoperatethebusinessdevelopmentservices(BDS)unittosupportmemberSMEsinwritingcommercialviablebusinessplans,linktonetworkofpotentialfinanciers

• StructureSMEnetworking&learningactivitiesthroughintotal25zonalbusinessclubsand6cross-countrysectordesks.Organizebusinesstrainings,B2Bs,exchangevisits

• PlandesignandimplementationoftheM&Esystem,andreportonhalf-yearandannualprogresstoclient,includingbasedonnewapp-baseddatagathering

• Establishcross-countrysectordesks:uniqueknowledgethinktanksandB2BplatformsforSMEsfromsameagri-input,dairy,fruit&vegetables,honey,andpoultrysectors

• Coordinateactionresearchonthehypothesisthat‘agribusinessSMEgrowthresultsinfarmergrowth’;fieldinterviews(36companies,112farmers),dataanalysis,reporting

• Annualandmid-termevaluationofprogress,onactivityandtargetconsistency,outcometargets,planningforsustainabilityafterproject,andimpact

Privatesectordevelopmentadvisor,WageningenUniversity–CentreforDevelopmentInnovation.Otherexperience,past10years(2012–2017)

• Seedpotatosectorinvestmentstudy,scoping,trademissionseminar,Tanzania,2016

• Commercializingfoodsecurity,maizestorage&marketing,Tanzania,2012-2013

• Dutch-Kenyanseedpotatotradepartnership,sectordevelopment,Kenya,2011-2013

• AgribusinessBDSmentoringprogramAECF,Kenya,Tanzania,Uganda,2011-2012

• Privatewarehousebusinessmodel:ruralstoragewithWRS,Tanzania,2010-2011

• Conservationtillagebusinessmodelforrain-fedareas,Tanzania,2009-2010

• FacilitatingruralentrepreneurshipprocessesinVCs,trainings,Zambia,2010

• Chain-widelearning:conceptsandtoolsforVCdevelopment,trainings,Uganda,2010

• PartnershipforSME-drivenseedchains,Kenya,Tanzania,Uganda,Malawi,2010-2012

• FishcompassforexporterstotheEUmarket,Indonesia,Netherlands,2010-2011

• AfricaAgribusinessAcademy,pilotphase,Kenya,Tanzania,Uganda,2009-2011

• ImpactevaluationoflivestockVCdevelopmentprogram,Kenya,2009

• Successfactorsforviablecontractfarmingarrangements,Ethiopia,Kenya,2009

• Warehousereceiptsandcommodityexchangemodel,Zambia,Malawi,2009-2010

• ProgramstrategyplanningforVCdevelopment,2008,Kyrgyzstan,Tajikistan,2008

• Towardsengineeredtradeproposalsonagriculture:India’sstand,India,2008-2010

• Small-scalefarmerinclusivePPParrangements,Kenya,Uganda,Zambia,2008-2009

25

• Alternativelivelihoodstrategydevelopmentandimplementation,Indonesia,2007-2008

• Universityconsultancyunitsasoutreachcentersfordevelopment,Vietnam,2006

• Marketaccess-sustainablemarkets,varioustrainings,Asia,Netherlands,2005-2010

Otherprofessionalexperience(1997–2007)

• Directorofdisaster-reliefprojectinpost-tsunamiAceh:rehabilitationofagricultureproduction,watersupply,andsupportstructureforprovidingsocialandmedicalservices.Managing12staff.Indonesia,2005-2007.

• DirectorofRoyalHaskoningEgypt,providinglocalTAsupporttoDutchHQ’swaterandenvironmentalprojects.Acquisitionandmanaging5technicalstaff.Egypt,2000-2001

• AdvisorfortheWaterandEnvironmentInternationaldepartment,andlatermemberoftheStrategicBusinessDevelopmentunit.RoyalHaskoning,Netherlands,1997-2003

4. EDUCATIONANDWIDEREXPERIENCEAcademicQualifications:

• MSc,AgriculturalMarketingSystemsforDevelopingCountries,atCranfieldUniversity,CranfieldSchoolofManagement,UnitedKingdom,1992

• BScpropaedeuticyear,AgriculturalMarketing&TradeforDevelopingCountries,attheInternationalAgriculturalCollege,Netherlands,1990

• HigherNationalDiploma,Land&WaterManagementforDevelopingCountries,attheInternationalAgriculturalCollege,Netherlands,1989

CountryExperience:

• Azerbaijan,Belgium,Egypt,Ethiopia,India,Indonesia,Kenya,Kyrgyzstan,Malawi,Netherlands,Romania,Rwanda,SouthAfrica,Tajikistan,Tanzania,Uganda,Vietnam,Zambia

Languages:

• Dutch,English,(basicFrench,Spanish)

Publications:

• Overtheyearsinputandadvisetovariouspapersandpublications.Co-editorofthebook‘Agro-foodchainsandnetworksfordevelopment’(2006),ontheroleoftradefordevelopment;andofthepaper‘Criticalfactorsforcontractfarmingarrangements:thecaseofEthiopia(2011)on10criticalfactorstoenhancesolidcontractfarmingarrangements.

26

CVSierkPlaat

1. Familyname : Plaat2. Firstnames : FransSierk3. Dateofbirth : 14July19504. Nationality : Dutch5. Civilstatus : Married(3children)

6. Education:Institution LondonUniversity,London,UK,Imperial(Wye)CollegeDate: from(month/year) to(month/year

1982-1983

Subject(s) DevelopmentEconomicsandFarmManagementSecondarysubject:ProductionEconomics/Agromarketing.

Degree(s)orDiploma(s)obtained:

MasterofScience

InstitutionDeventerStateAgricultureCollege,Deventer,Netherlands

Date(from/to) 1969-1975Subject(s) TropicalAgriculture,specialisationinAnimalHusbandry.

Secondarysubjects:FarmEconomicsandRuralSociologyDegree(s)orDiploma(s)obtained

HNDandB.Sc.degree

InstitutionAgricultureCollege,”Warmonderhof”,Warmond(nowinDronten),

Date(from/to) 1966-1969Subject(s) SpecificemphasiswasputontheBiologicalDynamic(Organic)Farming

methodology.Horticultureandgeneralfarming.Degree(s)orDiploma(s)obtained

DiplomainAgriculture(OND).

Courses1968 : Handandmachinemilking1968 : Fulldrivinglicence1976 : ArtificialInsemination1985 : PersonalComputer1986 : FinancialManagement,DeBaak,Noordwijk1986 : ReportProposalWriting1986 : ProjectAppraisal,InHouseHVAinconjunctionwithWageningenUniversity2008: Valuechainanalysis.(agriculturechainsMDF)2010: Coursesinnegotiations.2012/13: CompliancecoursesinhouseRabobank./starterscreditcourse7. Languageskills:(increasingcompetencefrom1to5)

27

Language Reading Speaking WritingDutch 5 5 5English 5 5 5German 3 2 2French 3 2 2Kiswahili 3 3 -8. Membershipofprofessionalbodies:NEDWORC.9. Otherskills:computerliterate.(words,excell,PPetc)10.Presentposition:AnalystInternationalFood&Agricultureadvisory.

11. Yearswithintheorganisation:1.Professionalexperience:4612. Keyqualifications: Project/businessmanagementandco-ordination Developmentofbusinessplans/bankablereports Financialengineering,duediligencereporting AgriculturalEconomics,marketing Market,businessandstrategydevelopment. KnowledgeofAsian,EasternEuropeanandAfricanagrobusiness Feasibilitystudiesandinvestmentcalculation Farm,rangemanagement,Dairychainmanagement. DevelopmentFruits&Vegetablesintegratedproductionsystems Training Smallfarmersdevelopment13. SpecificCountriesexperience:Longterm:Tanzania,Nigeria,Vietnam,Romania(total19years)Mediumtermvisits>2months:Mali,SierraLeone.Severalshortvisits:Kenya,Uganda,Rwanda,Mozambique,Ethiopia,China,(Hongkong),India,Egypt,Ukraine,Indonesia,Romania,Poland,Liberia,Jordan,Zambia,SaudiArabia,Iran,Brunei,Canada,SingaporeShortvisits:SouthAfrica,USA,Ghana,Italy,ElSalvador,Honduras,Guatemala,CostaRica,BanglaDesh,Slovakia,Thailand,Cambodia,Serbia,Turkey,Sudan,Malawi,Serbia,Croatia,Afghanistan,Somaliland.14.Projectexperiencesandprofessionalexperiencerecord

Date(from/to) 1-11-2015-presentCountry NetherlandsPosition AnalystAfricanAgriculture.PlaatAfricanAgricultureAdvisoryDescription BasedinTheNetherlands.AdvisoryservicestoinvestorsinAfricanAgriculture

valuechains.TwojobsunderhandinTanzaniaandUganda.Acquisition.PUMassignmentsinSomaliland,developinggoatprojectandBangladeshdairymarketreconnaissanceforSolidaridad.CoachatmakeAfricawork.BusinessplanforFarmersAssociationNiawama.Pre-feasibilitystudyTasikmalaya,Indonesia,Agri-exportpotential.

28

Date(from/to) 2007-2011Location Gorssel(Netherlands),Romania,Afghanistan,Indonesia,P.R.China,Croatia,Position SeniorConsultant/Interimmanager/DirectorPlaatAgroConsultancyDescription Afghanistan:5weeksconsultancyforGFA/GTZonprojectidentification

agriculturechainprojectsinKunduz,Badashan,Balkh,Tagharprovinces.Identificationof12projectsincl.womenprojects,adairyintegrationandfruit&vegetableschains(2008)Netherlands:evaluationofambitiontointernationalizeknowledgetransferonintensiveanimalhusbandryforPRIVON.(coalitionofstakeholdersinthepiggerychain).(2008)Businessplanforfruittreenursery(TreenurseryJV)privateclientandORET(2008)Romania:Businessplanfor1200hectaresarablefarmforgroupofprivateinvestors.Iamco-investor.Fundraising.Investmentprospectus.Farmisacquiredandinoperation.(Iamco-ownerandDirector)GabanafermSRL(2007)AssistingpreparationbusinessplanhorticultureprojectinRSAforprivateinvestor.(2007)FinalizationofpostTsunamiprojectsinAceh,Indonesia.Advisorfortheestablishmentofanagro-associationandwomencreditunion.Implementationoflivelyhoodprojects.OXFAM,RABO,UNDP.(2007)AcquisitionforthirdpartyCroatia,Laos,China,RSA,Romania.11.08.08-11.09.09OneyearcontractasManagingDirectorforBondaNutritiaAnimalaSRLwithCEHAVE/Bondalivestockfeedstoset-upgreen-fieldoperation.Tradingfoodindustrybyproductsaslivestockfeeds.Start-offwithbrewersgrainandbrewersyeasttofarmers.Recruitmentsalesmanagers,settingupcompany.Commercialization01.12.2009-01.01.2010BusinessplaninP.R.Chinaforabio-gasinstallationwithAgroBioVisionandHuaHuaNiuDairiesinZhengZhou.(economist)BusinessplanforalargescalevegetableprojectinRomania(privateclient)DirectorGabanafermSRLRomania.PartnerandChairmaninDairycooperative.InitiatingEUsubsidiesFEADR.From01.03.2010-31.12.2011.PartnerSchiere,Simiuc&partners(growthstrategies)AgricultureDDforlargeinvestor.Romania.

Date(from/to) 2005-2007Location Wageningen,AgromisaFoundationPosition DirectorDescription AgromisaFoundationisanorganisationinvolvedintheknowledgetransferof

agricultureknowledgetosmallfarmersinthethirdworld.Thisisdoneby

Date(from/to) 2011-present(retirementon01-11-2015)Country DaresSalaam,Tanzania.From1/1/2015inUtrecht,NetherlandsPosition SeniorAnalystAfricanAgriculture.RabobankInternationalFood&Agriculture

advisoryDescription BasedinTanzaniadeliveryF&AservicestotheRabobankPartnerbanksin

Tanzania,Rwanda,Zambia,UgandaandMozambiqueandcommercialsupport.SupportRabobankonF&AAfricanissueslikestudysugarsectorinthe4countries,Tanzaniacoffee,Zambiadairysectorstudyandseveralshorttermadvisoryjobs.Mappingcoffee,horticulture,dairyinEthiopia.DairystudyinKenya.Advisoryservicestolargeclients,participationdealteamsforregionalprojects.

29

developingandissuinganumberofpublicationsandbydevelopingparticipatorytrainingstoseveralorganisationsinmostlyAfricancountries.ProfessionalvisitstoZambiaandKenya.Agromisahas10salariedstaff(5.5FTE)andmorethan50volunteerswhohelpdevelopingnewprojectsandassistthestaffindoingtheirwork.BoardmemberofAgri-ProFocus,thefollow-upoftheDoornboscommittee.ThedirectorshipisdoneincombinationwithworkforAppliedPlantResearch(WUR)

Date(from/to) 2003-2007Location Lelystad,TheNetherlands,AppliedPlantResearch,WageningenUniversityPosition SeniorConsultant/trainerDescription Identificationmissionsandco-ordinationFruitandVegetableprogramCBI,

Kenya,Egypt,Uganda,GhanaandJordan.Acquisitioninternationalprojects(Serbia),internationaltraining.lecturesLublin,Polandhorticultureproject,Ukraineopenvegetableproject,HorticulturechaindevelopmentprojectinRomania,traininginUganda,Jordan,Egypt,etc.Tenderpreparation.TrainingCertificationinKenyafor20studentsfrom12sub-SaharancountrieswithIAC.SeveraltrainingactivitieswithIACWageningenandLarensteinforforeignstudents.Acehgingerprojectadvisor(postTsunami)(UNDP)incl.2visitstothearea.

Date(from/to) 1999–2003Country Zambia,Uganda,Kenya,Tanzania,Egypt,Guatemala,CostaRica,Honduras,El

Salvador.Ukraine,Lviv,Indonesia,SouthAfrica,Uganda,Ghana,ItalyPosition ProjectDirector/seniorconsultantAgrimentInternationalBV.SeniorConsultant/

Director.PlaatAgroConsultancy.LecturerLarensteinAgricultureTechnicalUniversity

Description IdentificationtrainingneedscutflowerandyoungpotplantmaterialprojectsforCBI.AlsoPSODairysectorDevelopment.ProjectDirectorLviv,Ukraine,IdentificationmissionsFruitandVegetableprogramCBI.EstablishmentownconsultingfirminSouthAfrica.LectureratLarensteinTechnicalUniversityDeventerinInternationalHorticultureeconomicsforpostdegreestudents.

Date(from/to) 1996-January2002Country TheNetherlandsPosition AreamanagerAsia–seniorconsultantCEBECO/AgrimentInternationalDescription ResponsibleforbothsuccessfulJointVentureinIndia(CEBECOIndia)and

representativeCEBECOofficeChina.Responsibleforcommercialprojects,seminars,presentationsinIndia,Vietnam,Thailand,Bangladesh,China,Africa,CentralAmericaandBruneiaswellasacquisitioninthesamearea.Teamleaderandparticipantofseveralfeasibilitystudies.Subjects:mostlyhorticultureprojectsincludingcutflowersandpottedplantprojectsaswellasFruit&Vegetableprojects.FeasibilitystudyHorticultureprojectinNanyangP.R.China(Flowers&Plants,1999)AgriculturesectorstudyDutchAgro-businesschainsandinvolvementDutchAgrobusinessinIndonesia(1999)VegetableproductionstudyIndia(Pune)Feasibiltystudy(economist)oftheestablishmentofaslaughterhouseinDhaka,BanglaDesh(1998)andothers.

30

Date(from/to) 1995-1996Country TheNetherlandsPosition DirectorownerPrivateCompany,PlaatAgroConsultancy.Description FirsttaskwascompletionofaPoultryStudyinVietnamforCebecoInternational

Projectsandfollow-up.Thesecondtask,alarge-scalepoultryintegrationinBruneiwhichhadalreadystartedandsomeotherprojects,likeadairyprojectinNorthernVietnam.

Date(from/to) 1994-1995Country VietnamPosition ProjectManagerCebecoInternationalProjectsB.VDescription DirectorGeneralatalargescalefarmingandprocessingcompanyinDalat

(Dairy,pigs,poultryandvegetablecrops),Vietnam.MainsponsorAgravinaLtd.fromHongKong.ThemainsponsorscaledtheprojectdownduringJune1995,therebyfinishingmycontract.Contractingproducewithsmallholderfarmers.(CabbageforexporttoCambodja)DuringtheperiodInegotiatedonbehalfoftheJointVenturewiththeVietnameseAuthorities.Beforethescalingdownseveralbusinessplanswerepreparedfordifferentventuresrelatedtothedairybusinessaswellasvegetableprocessingandexportprograms.Partoftheplansareexecutedsuccessfullynow.AlsosupervisorydirectoratflowerprojectHasfarmDalatandvegetableexportproject.

Date 1991-1994Country/place Nigeria,Company HVA-InternationalforIntegratedDairyFarm/WAMCO,anaffiliateofFriesland

DairyFoods(NowFriesland/Campina)Position GeneralManagerDescription Thecompanywasengagedingrowingfoddercrops,dairyfarming,milk

processing(cheese,yoghurt,butter,pasteurisedmilk),milkcollectionandmarketing(anddirectsales)oftheproducts.Twopermanentexpatriateswereemployed,whileseveralwereengagedonashort-termbasis.Theorganisationhad12seniorNigerianstaffemployedacademics)andabout85juniorstaffonapermanentbasis.Thefarmhadanaverageproductionlevelofmorethan6,000litre’spercowperlactation,whilesomewereover10,000litres.Particularsuccesswasbookedwithacrossbreedingprogram.OnthedairyprocessingsidesuccesswasbookedwiththeintroductionoflocallymadeGoudaCheeseandfruityoghurt.Anewbrand(“FarmFresh”)wassuccessfullyintroducedduringmystay.PublicRelationswasarelativelyimportantpartofthetask.Amilkcollectionprogramwassuccessfullyexecuted.Inaneconomicallyandsociallydifficultenvironmenttheorganisationwasandisasuccess.ReportedtotheExecutiveManagingDirectorofWAMCO.Duringthestay,asectordairystudyforIDA/WBwasconductedinNigeria.

Date 1988-1991Country/place TanzaniaCompany HVA-InternationalforFarmlandsTanzaniaLtdPosition GeneralManager

31

Description

Acommercialcompanymanaging2recentlyprivatisedsisalcompanies.Onapermanentbasis5expatriateswereemployedfromdifferentcountriesandseveralshorttermspecialists.Onapermanentbasisabout75peoplewereemployedbutintheplanting,weedingandharvestingseasonupto1000peopleonashorttermbasis.Duringmystay2500hectaresofsisalwereplantedandabout50hectaresoftobaccointroducedfrombush.AllMIShadtobestarted.Noadministrationwasavailableatallinthebeginning.Thecropswere:Sisal(includingprocessingandgrading),tobacco(Burley),maize,pulsesandspecialcropsaspapaineanddriedpeppers.Thecompanyhadtobestartedfromscratch.Landundercultivationabout4000hectares.Logisticaloperationswereessentialpartofthebusiness.Contractfarmingtobaccowassetupwithsmallholders.IreportedtotheBoardofDirectors.

Date 1984-1988Country/place Amsterdam,TheNetherlandsCompany HVA-InternationalPosition Teamleader,participant,botheconomistandagriculturistDescription Consultantforfeasibilitystudies,projecttake-overs,projectpreparationand

financialengineeringasTeamleaderandparticipant.Oftheover20studies,afewwereinSouthEastAsiaandondairy.FrequenttravellingtoAfrica,theMiddleEastandFarEast.(Zambia,Zimbabwe,Nigeria,Liberia,Uganda,Iran,SaudiArabia,Ethiopia,Indonesia,Thailandetc.)Thestudiescoveredawiderangeofsubjectsintheagriculture,horticultureandagro-processingsphere.TheyrangedfromNationwidesectorstudieslastingmorethanhalfayeartoshorttermstudieslikethepromotionofflowerexportsfromZimbabwe.Theclientswerefromdifferentbackgrounds,bothGovernmentandprivate;

Date(from/to) 1984Country MaliPosition InterimEconomistDescription InterimEconomistforDGIS/OfficeduNigerinMali.Lastedabout4months.The

projectwasinvolvedinlarge-scalerehabilitationofirrigatedpaddyfieldsforsmallfarmer’suse.

Date(from/to) 1981-1982Country TanzaniaPosition ProjectCreditOfficerDescription DGIS/IDA/TanzaniaRuralDevelopmentBank.Co-ordinatorofalarge-scaledairy

developmentprogram,supportedbytheWorldBank.Loanappraisals,disbursements,repaymentsandbudgetpreparationandcontrolfor12largescaledairyfarmsand4processingfacilities,alsoincludingsmallscalelivestockprojects,nationwide.TheprojectconsistedofParastatalcompanies.Theprojectemployedover15expatriates,someofthemdirectlyemployedbyTheNetherlandsandDanishGovernments.Itwasincludinglivestockpurchasesabroad.MyemploymentwasendedonmyownrequestbecausetheWBdisbursementswereending.AfterthatIwentforfurtherstudiestoLondonUniversity;

32

Date(from/to) 1979-1981Country TanzaniaPosition RegionalProjectOfficerDescription DGIS/TanzaniaRuralDevelopmentBank,loananalysis,loanexecution,budget

control,loanrecovery,forsmallandlarge-scalelivestockprojectsintheNorthernProvincesofTanzania.(dairy,poultry,ranching,pigs)Theprojecthasbeensuccessfuluptothismoment.IthasexpandedtootherprovincesandhasboostedthedairyindustryinTanzania.ItisnamedasanexampleofasuccessfuldevelopmentprojectbytheWB,themainprojectsponsor,uptonow;Livestockpurchasesforthedifferentprojects(pigs,dairyandbeefcows,sheep).

Date(from/to) 1975-1979Country TanzaniaPosition AssistantManager/VolunteerSNVDescription AssistantManagerofalarge-scaledairyfarminWestKilimanjaro,Tanzania,

OrganisationofNetherlandsVolunteers/TanzaniaDairyFarmingCompany.About1200hectaresandtheherddevelopedfrom250headsto1000headsofcattle,grasslandmanagement,infrastructuredevelopment,workshop,severalcrops(seedbeans,barley,wheat,linseed,sorghum,maize,vegetables,etc.)budgetpreparationandplanning.Involvementinlivestockpurchasesfortheproject.

15. Personalcompetencies:

• OperationalManager,actionoriented,pragmatic.• Consultant,sectorstrategydevelopment.• Actionoriented,commercial,pragmatic,active• Representative,goodnetworkingskills,goodcommunicator• Stronginternationalorientation• Analytical,helicopterview,Teamworker,• Loyal,reliable,respectfulandaccessible• Abletooperateunderstress• Openminded

16.Listofrecentpublications:

• ProjectidentificationagricultureprojectsinNorthernAfghanistanforGFA-GTZ(2008)• LookingforDelta.Co-author.HowglobalcompaniescanhelpSub-SaharanAfricareachits F&Apotential.BackupforannualspeechbytheRabobankCEOatthejointWB-IMFannual conference.(2013)• ClimbingKilimanjaro.Tanzaniancoffeesectorshowspromisingpotential.(Rabobank Industrialnote)(2013)• SweetfutureforMozambiqueSugar.(RabobankIndustrialnote)(2015)• Tanzaniasugar.(RabobankIndustrialnote)2012• ThebuzzsurroundingEthiopiancoffee.(RabobankIndustrialnote)2015• FeasibilitystudyKenyandairysector.Co-author.(2014)• Zambiandairysector.Milkthecowthatstandsstill.(Rabobankindustrialnote)(2015)• ZambianSugarsector(RabobankIndustrialnote)(2013)• VariousinstructionmanualsforagriculturefinanceforAfricanpartnerbanksRabobank.• BusinessplanforGoatfarminSomaliland(2017)(PUM)• BusinessplanforFarmersAssociationInKenemaSierraLeone.(2017)PUM• MarketingplanfortheBangladeshdairysector(Solidaridat)(2017)

33

17. OtherRelevantInformation:referencesavailableuponrequest.SierkPlaatMsc.Voorende2a,7213XZGorssel,TheNetherlands.Mob.+31(0)638911031e-mail:sierkplaat@hotmail.com