Regional conference on Forest and Farm Producer Organizations (FFPOs)

From users to producers: Scaling up FFPOs businesses to implement Sustainable

Development Goals (SDGs) in climate resilient landscapes

Thingaha Hotel, Nay Pyi Taw, Myanmar, Monday 20 to Wednesday 22 November, 2017

Reaching prosperity of Toraja Coffee Farmers through independent and professional

Farmers Cooperative

Background

• Coffee is the main source of income for Toraja farmers, contributing to reach 60% of the total annual income of farmers

• Arabica Coffee = superior product of Toraja region

• Almost all sub-districts in Toraja are suitable for arabica coffee because Torajaregion is a high plateau (1000-2000+ mdpl)

• Toraja Arabica Coffee is well known in the world market due to its quality.

Map of Indonesia Coffee production

71 %

14 %

7 %

7 %

1 %

0,.%

TORAJA

Farmers condition

• Revenue earned by farmers is still low

• Farmers' bargaining position is weak

• Coffee production is low

• Coffee quality (control) is low

• Individual sales are more controlled by middlemen

Toraja Coffee Farmers Association’s Cooperative

Toraja, South Sulawesi, Indonesia

Farmers Cooperative

• In 2011 Toraja coffee farmers initiated the establishment of the Toraja Coffee Farmers Association (PPKT) as a continuation of the APKT organization that has been established in 2007.

• In 2014 PPKT formed Toraja Coffee Farmers Cooperative (Koptan PPKT) as a collectivemarketing and improving the quality of production, economic size and the bargaining position of farmers.

• Total member farmers served: 1736 (m = 1285, f = 451). Spread over 89 groups in 28 villages from 2 districts (Tana Toraja and North Toraja) with total Land area: 837 ha

Activities

• Collective marketing

• institutional strengthening of farmer groups & PPKT cooperative

• Coffee field school / cultivation training

• Harvest and post harvest training

• Developing processing units

Activities

• Training of internal control system

• Facilitation of farmer groups to obtain product certification

• Networking and partnership with coffee Toraja multi-stakeholders

• Coffee promotion at national & international events in cooperation with SCAI (Specialty Coffee Association of Indonesia) & SCOPI (Sustainable Coffee Platform of Indonesia)

Supply chain

Toarco

Petani kopi

KonsumenRoasted & powder

GBE Specialty

Sulotko

Cafe di jawa, bali

MTC groupHS kering; GBE

HS basah

Colector

ToarcoHS basah

HS Basah

HS basah

HS basah

PPKT Coop

KUD Sane

Sales volume by PPKT Coop

Form Volume penjualan 2015 (kg)

Nilai penjualan 2015 (Rp)

Volume penjualan 2016(kg)

Nilai penjualan 2016 (Rp)

Spesialty GBE (kg) 2000 185.000.000 4240 480.697.000

Roasted (kg) 35 867.800 28 4.815.000

Powder (bks) 100 5000.000 279 12.527.000

Powder (kg) 34 5.240.000

190.867.800USD 14,129.7801

503.279.000USD 37,255.7491

Lesson Learned

• PPKT develops sustainable farming and business systems to improve farmers' bargaining position and gnerating more income.

• Through the development of farmers cooperative, PPKT can do: 1. Collective marketing of coffee produced by its members. Before the

formation of cooperatives, the farmers used to sell their coffee to middlemen where the farmers can not control the price and do not have a good bargaining value. But with the existence of a cooperative farmers' production can be sold at a better price. In addition, farmers (members) also still get benefits from the Cooperative Business Result (SHU).

2. Consolidate and control the quality of products and integrate it to the market system

3. Developing sustainable and organic farming systems (environmental services) and eco-friendly multicrops cultivation systems, which also benefiting the environmental sustainability.

4. Bio-diversity conservation (forest protection)5. Implementation of Good agriculture practices (GAP)6. Certified : Geographical Indication (IG)

Challange

• Lack of cooperative capacity in running business and cooperative management,

• Limited working capital,

• Low productivity because farmers still use traditional treatment, old coffee trees and expertise about GAP is still limited

• Limited facilities and processing infrastructure at the farmers and cooperatives level.

• Climate change

Recommendation

• Supporting land ownership by farmers, clarity regarding the status of land protected by the state (law), so that farmers can improve their role and enhance the mobility of their product and business.

• Facilitation process by the government to support the capital / business development of farmer cooperatives

• Strengthening Farmers-private-policy makers relations in supporting farmers’ businesses

Recommendation

• Developing cupping lab and cooperative cupper team

• Improving capacity of cooperative business management & finance

• Capacity building for farmers/members on GAP and post harvest

• Development of post-harvest drying and processing facilities

• Enhanching coffee market through alternative activities and businesses i.e opening coffee shops connected to the cooperative and coffee tourism as well.

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