Government offers help to dairy cooperatives

JAKARTA (JP): The government has offered assistance to dairy cooperatives in finding a solution to their debt problems.

"The cooperatives facing problems with their debts should report to the government. We are ready to help solve the problems," Minister of Cooperatives and Small Enterprises Subiakto Tjakrawerdaya said after the opening of an annual meeting of the Indonesian Association of Dairy Cooperatives on Friday.

He said his ministry might establish a special team to study the debt problems of dairy cooperatives and to seek ways to solve them.

He acknowledged that out of the association members' outstanding debts of Rp 300 billion (US$124.3 million), Rp 40 billion had gone sour.

Subiakto explained that the cooperatives' financial difficulties were mainly due to the fact that the farmers only had small herds of cows, lacked capital and lacked knowledge about cattle raising.

"The productivity of their cows, therefore, is very low," he said.

He said each farmer currently had only one to three milk cows, each of which produced only 10 liters of milk per day.

The dairy business would be profitable if each farmer had a minimum of 10 cattle, each with a productivity of 15 liters per day, he said.

When asked whether the government might offer to write off dairy farmers' debts, Subiakto said: "It's possible. But, certainly we have to study the debt problems case by case"

Meanwhile, the chairman of the association, Hardjono Hamidjojo, reported to the minister that most of the group's members had made a profit since 1992, with a collective profit of Rp 141.6 million in 1992, Rp 1.07 billion in 1993, Rp 537 million in 1994, Rp 409.7 million in 1995 and Rp 309.4 million in 1996.

The association, he said, currently grouped 205 cooperatives with 80,000 total members.

He said Indonesia's milk consumption was estimated at two million tons this year, while local production might reach only 600,000 tons. The country, therefore, would have to import the balance.

Domestic milk consumption usually increases by an average of 12.8 percent per year, he added. (10)