Smallholders increase role in rubber production

Smallholders increase role in rubber production

JAKARTA (JP): Smallholders will continue dominating
Indonesia's rubber production and exports in years to come, even
without adequate support from the government.

Data from the Indonesian Rubber Association reveals that
smallholders control 83 percent of Indonesia's total rubber areas
of 3.45 million hectares, contributing 74 percent of the
country's total annual rubber production of 1.5 million tons.

However, 85 percent of the smallholders' rubber plantation
areas have never been involved in the government's smallholder
development projects.

"The untouched plantations are like jungles, with annual
yields of less than 600 kilograms per hectare (as compared with
rubber estates' productivity of 1,400 kilograms per hectare),"
the association's executive director, A.F.S. Budiman, said last
week.

From the outset, there is a clear difference in the operation
of rubber plantations by large estates and smallholders.

Smallholdings are operated in a semi-subsistence and capital-
scare environment, where labor is used within the family's
capacity. Meanwhile, large estates are managed as capitalist
commercialized agriculture, with a rigid hierarchical management
of labor.

Although rubber smallholders rarely get assistance from the
government or any formal institution, they have been playing a
dominant role in the country's rubber production and exports
since Dutch colonial times, Budiman said.

The management of rubber plantations by smallholders was first
introduced in Indonesia by traders and laborers who bought rubber
seeds from plantations in Malaysia in 1908, five years after the
establishment of the first rubber estate here.

The crop reached widespread adoption after the hike of rubber
prices from 1909 to 1912. At that time, rubber spread over large
areas, from Jambi to Palembang in South Sumatra, Java and some
areas in Kalimantan.

In the beginning, the Dutch colonial government was not afraid
of the rapid spread of smallholders. But after the fall of rubber
prices in the early 1930s due to the world depression, the Dutch
government tried to restrict the expansion of the smallholder
sector by imposing a tax on their exports. However, this
restriction had little impact, as farmers continued to plant
rubber on the consideration that it could provide a relatively
consistent cash income and a low-opportunity cost incorporated
with other crops.

"The adoption of rubber cultivation by smallholders was really
a self initiative of the peasants, without any assistance from
the government or any formal institution," Budiman said.

During the post-independence period, especially from 1945 to
1950, many rubber estates and smallholding properties were
neglected, sold or destroyed. As a result, rubber production
decreased significantly.

This condition continued until the new Indonesian government
nationalized all Dutch estates in 1957. However, political
instability, mismanagement of plantations and the neglect of
smallholders resulted in a decrease in rubber exports by 15
percent, from 1956 to 1965.

In that period, smallholders were not only neglected, but also
disadvantaged. Rubber farmers, for instance, had to pay heavy
taxes, 25 percent higher than rubber estates, even though the
revenues from such taxes had little direct benefits for
smallholders.

In the early years of the New Order administration, the
government still paid more attention to state rubber plantations
than to smallholders. The government started to develop state
rubber plantations, especially those in North Sumatra, with the
help of foreign loans, from the World Bank in particular.

In the early 1970s, the government expanded the World Bank's
loans to the smallholding sector by establishing planting and
replanting projects. By mid-1980s, however, it was already
apparent that high-cost block planting projects had proven
difficult to implement in the country and had benefited only a
small fraction of rubber smallholders.

Budiman said Indonesia's smallholder rubber development
efforts met with very limited successes. The smallholder
development projects covered only 15 percent of the existing
smallholder rubber acreage.

"The association is concerned about the supply prospect of
smallholder rubber, which is the backbone of Indonesian rubber in
the future," Budiman said.

He explained that the association has initiated cooperation
with the regional office for Southeast Asia of the International
Center for Research in Agroforestry, an affiliate of the Nairobi,
Kenya-based Consultative Group on International Research.

The cooperation is aimed at developing ways to manage
smallholders' rubber jungles, which normally have a low
productivity level, into an agroforestry system that sustains
both environmental conservation and rubber farmers' livelihood.

Under the cooperation, they are now working on pilot projects
in Sanggau and Sintang, both in West Kalimantan, and Muara Bungo
in Jambi. (rid)