Improving Livelihood in Organic Dairy Product

Lesson Learned : market Driven Organic Dairy

Program in NongkoJajar East Java

Emilia Setyowati – Executive Secretary of Trubus Bina Swadaya


The national dairy
production only covers
around 22% of the national
demand, and mostly as small-
scale farmers which face
several problems:
• Less Capital
• Less Technology
• Less Innovation
• Less bargaining position,
• Lack of information.
OPPORTUNITY
• Demand for Organic
Product is high
SOLUTION
• There is no organic
dairy product in • Pilot a market-
Indonesia driven and
sustainable organic
dairy production
• Increase milk
productivity as well
11.000 small famers as the economic
(3-5 cows) in Pasuruan
output of the dairy
value chain in
Indonesia
 Piloting a market-driven and sustainable organic dairy production,
increases milk productivity and economic output of the dairy value chain in Indonesia.

Organic milk production developed, and
general dairy farm management improved,
which offered more labour and increased
farmers' income.
Processing and marketing of organic dairy
products are viable business activities of Arla
and Indolakto, knowledge exchange,
experience and coordination with stakeholders
in the organic dairy value chain are strengthened

• Dairy farmers produce • Indolakto dan Mazaarat • Market for • Dialogue and • Project model
KPSP Cooperative deliver Cheese processes certified Indonesian collaboration and results
significant quantities of organic dairy products and organic dairy improved in communicated
high-quality certified has expanded its dairy products the dairy
organic milk. product portfolio. developed value chain.
 • Dialogue and • Project model and
• Dairy farmers produce • Indolakto dan Mazaarat • Market for results
Cheese processes Indonesian collaboration
KPSP Cooperative deliver communicated
certified organic dairy organic dairy improved in the
significant quantities of
products and has products dairy value chain.
high-quality certified
organic milk. expanded its dairy developed
Activities product portfolio.
• Appearances in
• Indonesian National Standard • Gross income of MDOD • Intake and processing of • Developing local • Identify needs, prioritise Danish,
(SNI) for Organic Dairy Farming trained conventional dairy organic milk [tons per organic dairy product and plan actions, International
farmers day] including advocacy for and/or Indonesian
• Pilot production of organic milk
• Marketing local organic development of organic media
from demonstration farms • Farmer gross income from • additional jobs created
dairy product dairy
organic milk production at Indolakto and
• Upgrading farmers’ stables and • Annual
increased Mazaarat Cheese
production systems to comply • jobs created at Arla • Activate value chain appearances on
with organic milk production • additional jobs at KPSP linked • organic product Indofood linked to forum for organic dairy each partner’s
standards to organic milk production and produced by Indolakto marketing and media platform
• Workshops and action
• Producing organic milk collection. and Mazaarat Cheese distribution of organic
plans on Responsible
• Milk yield products
• additional jobs at service Business Conduct
sector linked to organic milk • Local organic dairy
• Offering a loan facility for on- product brand • external farmer
production e.g. farm input and cooperatives visited
farm investments related to service suppliers present in
organic milk production supermarkets organic dairy
demonstration sites
 Program Activities 3. Strengthen the Organic Farming
Standards (SNI)
1. Farmers in KPSP 2. Target by 2026
1. Upgrading stables: construction
11.000 conventional • 2.000 organic trained (traditional stables with 2-4 cows).
2. Organic feed: feed quality, forage
farmers farmers and concentrate feed
• 200 farmers conversion 3. Organic Certification
to organic

4. Milk Productivity 5. Farmers income generated The livelihoods of conventional

Milk productivity per cow
increased, dairy company will
receive 12.800 l of organic
milk/day.
(potential to 250.000 l milk/day)
Conventional : Rp. 7.200 dairy smallholders developed
Organic : Rp. 10.000 (current situation)
Organic : Rp. 17.000 (full certified Healthier, happier, sustainable
organic status) agriculture
COST ANALYSIS Milk production Unit Prod Periode Price Sum 15 Month
Revenue
Conventional
Cows 10 head
Milk yield litre per cow 12 litre
Milk yield litre per 10 cows 120 litre 385 Days 7.000 Rp/litre 46.200 litre/15 Month Rp 323.400.000

Calves 10 head
R/C 10 Calves (15 months age) Rp 15.000.000 / calves 150.000.000

CONVENTIONAL Rp 473.400.000
Expenses
106%
Forage 1 head 10 heads Price Sum
Roughage per day
Cows 60 Kg/Head 600 kg 455 Days 600 Rp/kg 273.000 Kg/15 Month Rp 163.800.000
Heifers 32,5 Kg/Head 325 kg 275 Days 600 Rp/kg 89.375 Kg/9 Month Rp 53.625.000
Calves 17 Kg/Head 170 kg 180 Days 600 Rp/kg 30.600 Kg/6 Month Rp 18.360.000

Cocentrate 1 head 10 heads Price Sum

Concentrate per day
Cows 6,0 Kg/Head 60 kg 385 Days 4.000 Rp/kg 23.100 Kg/15 Month 92.400.000
Heifers 4,0 Kg/Head 40 kg 275 Days 4.000 Rp/kg 11.000 Kg/9 Month 44.000.000
Calves 0-3 Month 0,8 Kg/Head 8 kg 90 Days 10.000 Rp/kg 720 Kg/6 Month Rp 7.200.000
Calves 3-6 Month 1,8 Kg/Head 18 kg 90 Days 6.400 Rp/kg 1.620 Kg/6 Month Rp 10.368.000

Milk Feed 1 head 10 heads Price Sum

Calves/ day 2,8 Kg/Head 28,3 Kg/day 7000 Rp/kg 2547 litres/90 day 17.829.000

Worker Cost/Month Sum

Worker 2.500.000 Rp Rp 37.500.000

Rp 445.082.000

PROFIT / 15 Months Rp 28.318.000

PROFIT / Months Rp 1.887.867
COST ANALYSIS Milk production Unit Prod Periode Price Sum 15 Month
Organic Revenue

Cows 10 head
Milk yield litre per cow 12 litre
Milk yield litre per 10 cows 120 litre 385 Days 9.000 Rp/litre 46.200 litre/15 Month Rp 415.800.000
Calves 10 head
R/C organic = 10 Calves (15 months age) Rp 15.000.000 / calves 150.000.000

117% EXPENSES
Rp 565.800.000

Forage 1 head 10 heads Price Sum

Roughage per day
Cows 60 Kg/Head 600 kg 455 Days 700 Rp/kg 273.000 Kg/15 Month Rp 191.100.000
Heifers 32,5 Kg/Head 325 kg 275 Days 700 Rp/kg 89.375 Kg/9 Month Rp 62.562.500
Calves 17 Kg/Head 170 kg 180 Days 700 Rp/kg 30.600 Kg/6 Month Rp 21.420.000
R/C Organic > Concentrate 1 head 10 heads Price Sum
Conventional Concentrate per day
Cows 6,0 Kg/Head 60 kg 385 Days 3.700 Rp/kg 23.100 Kg/15 Month 85.470.000
Heifers 4,0 Kg/Head 40 kg 275 Days 3.700 Rp/kg 11.000 Kg/9 Month 40.700.000
Calves 0-3 Month 0,8 Kg/Head 8 kg 90 Days 10.000 Rp/kg 720 Kg/6 Month Rp 7.200.000
Calves 3-6 Month 1,8 Kg/Head 18 kg 90 Days 6.220 Rp/kg 1.620 Kg/6 Month Rp 10.076.400

Milk Feed 1 head 10 heads Price Sum

Calves/ day 2,8 Kg/Head 28,3 Kg/day 9000 Rp/kg 2547 litres/90 day 22.923.000

Worker Cost/Month Sum

Worker 2.500.000 Rp Rp 37.500.000
INVESTMENT
Cow House renovation 1.100.000 per cow Rp 2.750.000 * Amotization 60
Rp 481.701.900 month

PROFIT / 15 Months Rp 84.098.100

PROFIT / Months Rp 5.606.540
Year Demo farm Location Number of dairy cows (heads) DAIRY MILK CERTIFICATION
Before the update After the update
2022 PMT (KPSP Setia Kawan) Tutur Village 5 5
Thoriq Hadi Sideqi Gunungsari Village 4 9 In December 2022, KPSP Setia
Imam Mahfudhi
M. Hilal Ferdiansyah
Wonosari Village
Wonosari Village
4
5
0
5
Kawan has obtained organic
2023 KPSP Setia Kawan Wonosari Village 5 5 certificates for four demo
Sudarto Pungging Village 7 7 farms from LSO Seloliman
H. Sutrikno Kalipucang Village 5 5
Drh. Agus Susanto Ngembal Village 6 6 Mojokerto, East Java.
Total 41 42

Per October 2023 : 80 Farmer switch to

organic system with total 304 dairy
cows (Head)
Establishment of Pasuruan Prestige Unit
(UPPAS)
Along with AOI's animal welfare
workshop, the establishment and PAMOR Indonesia is a participatory
inauguration of the Pasuruan guarantee system in organic farming that
Prestige Unit was also carried out. involves farmers or producers with other parties
such as traders, consumers, NGOs, and the
The Pasuruan Prestige Unit is an government in assessing the quality system
entity that will play a role in according to organic standards.
conducting organic quality
assurance from the community The main actor of the organic guarantee quality
level in a participatory manner, system in PAMOR Indonesia is the producers
namely PAMOR INDONESIA*. themselves.

*PAMOR Indonesia has developed with reference to the National Organic Standards: SNI-6729-2010, SNI-6729-2013, and the latest SNI-6729-2016.
PAMOR Indonesia has also updated systems related to ecological and social aspects through various meetings such as the National PAMOR
Meeting which has been held annually since 2016. PAMOR INDONESIA has been registered in the International IFOAM directory.
As of June 2023, Mazaraat has produced
33 batches of organic cheese from
Nogkojajar farmer. The total stock of
cheese produced was 423.26 kg.
Currently cheese that can be consumed
is 132.89 kg and those that are in the
aging process are 290.37 kg.
Target market of Mazaaraat cheese are
premium market, they sell to Premium
event in Bali and export to Singapore.
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NONGKOJAJAR Area is immensely polluted by pesticides from apple trees. Laboratory research is
needed to ensure soil and water around the organic cattle farm. Switch to organic is the best answer
to revitalize Nongkojajar land.
VIDEO
sekretariat@trubusbinaswadaya.co.id

0811 8090 033

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