Farmer's need should take center stage<\/p>\n
Benyamin Lakitan, Jakarta<\/p>\n
Up until now, evaluation of agricultural programs has mostly
\nbeen based on -- or limited to -- agronomic parameters, such as
\nannual production, land productivity, total harvested area and
\nharvest index, etc.<\/p>\n
Success is claimed if there is an increase in crop production,
\nland productivity, harvested land acreage and cropping intensity
\nof agricultural commodities. This version of success has been
\ntouted almost every year at the national, provincial and regency
\nlevel. However, on the other hand, nobody can deny that farmers
\nhave not enjoyed the fruits of such a fairy tale of success.
\nTheir quality of life has not improved much since our
\nindependence.<\/p>\n
Increase in production does not benefit the farmers unless
\nprice stability can be managed. Almost every day we read in the
\nnewspapers that farmers suffer losses due to the sharp price
\nfluctuation of agricultural commodities. Recently, the price of
\nvanilla in South Sulawesi dropped sharply from Rp 300,000 (US$35)
\nto Rp 20,000 per kilogram. The price of pepper in Bangka Island
\ndropped to less than Rp 20,000 per kg.<\/p>\n
However, it seems that this basic problem has not been
\nseriously handled. Furthermore, it is not clear whose
\nresponsibility it is. Government agencies dealing with the
\nagricultural sector seem to react as if this is not one of their
\nresponsibilities. They do monitor the prices but do not make
\nenough effort to manage the prices.<\/p>\n
A new paradigm of agricultural development should place
\nfarmers' prosperity as a major indicator of the success of every
\nprogram implemented. Any progress should be indicated by an
\nincrease in farmers income. Of course, one might argue that there
\nare many factors that influence farmers income. However, a simple
\nformula is still valid, i.e., income equals the price of their
\nfarm produce after production costs are deducted. Since
\nproduction costs will not change much, therefore, the farmers
\nincome will very much depend on stability of price at a
\nprofitable level.<\/p>\n
Food processing companies should be designed as a reliable
\n"market" for local farmers who produce raw materials for the
\nindustries. An integrated program should be developed, not only
\nto produce fresh agricultural commodities, but also to handle the
\nproducts after harvesting, including to encourage the private
\nsector to invest in agricultural companies for processing
\nperishable crops into less perishable processed food products.<\/p>\n
An agriculture-based processing industry may play a
\nsignificant role in buffering price fluctuation since it will
\nabsorb excess production which cannot be taken up by markets as
\nfresh produce.<\/p>\n
The Food and Agriculture Organization (FAO) of the United
\nNations has estimated that the price that growers receive
\ntypically represents a small fraction of the retail price for
\ntheir commodities after being processed into finished products,
\nranging from as low as 4 percent for raw cotton to 28 percent for
\ncacao.<\/p>\n
If we are committed to improving farmer's quality of life,
\nthe ratio of revenue sharing between farmers and processors
\nshould not be too widely different.<\/p>\n
Start from the market and finish at the market. Every
\nagricultural program should be developed based on market demand
\nand cover all stages until farm produce reaches the market. A
\npartial and segmented program will not contribute significantly
\nin our efforts to improve farmers prosperity.<\/p>\n
Government agencies dealing with the trade and manufacturing
\nindustry should work closely with those responsible for
\nproduction of agricultural commodities by providing updated,
\naccurate and comprehensive information on market demand.
\nTrade agencies should also provide information on market
\nopportunities prior to and at the time an agricultural commodity
\nis harvested.<\/p>\n
Some constraints in developing the food processing industry in
\ndeveloping countries, including Indonesia, have been recognized.
\nBesides technological and capital constraints, there is also a
\nsignificant constraint in exporting processed food to developed
\ncountries due to the tariff escalation policy in those countries.
\nProcessed foods face much stiffer import duty than unprocessed
\nraw commodities.<\/p>\n
Let's not ignore the Indonesian market of more than 238
\nmillion people. Efforts to overcome food trade deficits should be
\napproached from both ends: to increase the value of food exports
\nand to limit dependency on imported food items.<\/p>\n
Shifting from raw commodities to processed food will certainly
\nincrease the export value of food products. To achieve this,
\nappropriate technologies have to be developed based on local raw
\nmaterials and very limited technological dependency from foreign
\nresources.<\/p>\n
Diets and preferences of consumers in Indonesia have been
\ninfluenced by changes in the average income, urban lifestyle, and
\ninvasion of fast-food franchises. These irreversible changes in
\nconsumer behavior should be treated as a market opportunity for
\nfood processing industries in Indonesia.<\/p>\n
The perception that imported food is better than locally-
\nprocessed food should be eradicated by proving that domestic food
\nprocessing industries also implement food safety standards and
\nquality assurance for each and every food produced. Of course,
\nchanging perceptions will take time, but it can be accelerated
\nwith consistent and persistent efforts.<\/p>\n
If the food processing industry has been well established, the
\ndomestic market fully captured, some success in penetrating
\nglobal markets has been recorded, and farmers (growers) already
\nplay a significant role in producing raw materials for industries
\nand receive a reasonable share of profit from these integrated
\nactivities, then, and only then, can we claim that we have
\nachieved success in our agricultural development program.<\/p>\n
However, for a start, let's place the farmer on the center
\nstage of any agricultural development plan that we implement.<\/p>\n
The writer is an expert staff on food issues at the Office of
\nthe State Minister for Science and Technology, and a professor in
\nagricultural science at Sriwijaya University. He can be reached
\nat blakitan@yahoo.com.sg.<\/p>",
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