By Dyah Maharani
Indonesia faces significant deficit in both beef and milk production, leading to a heavy reliance on imports. In 2024, domestic production is estimated to fulfill only 60 percent of beef demand, requiring the remaining 40 percent to be met through imports.
Milk production is even more constrained, with local production covering just 20 percent of demand, leaving 80 percent dependent on imports. To address this, the Indonesian Ministry of Agriculture has implemented strategic initiatives.
Early efforts, such as UPSUS SIWAB (Special Effort for Mandatory Pregnancy in Female Cattle) launched in 2017, focused on increasing reproduction rates to expand the national cattle population. Building on this, the SIKOMANDAN (Cattle and Buffalo as National Strategic Commodities) program, introduced in 2020, aims to enhance productivity and population growth of cattle and buffalo, aligning with Indonesia’s goal of self-sufficiency in beef and milk production.
In addition to these efforts, recently, the agriculture ministry is actively supporting the government’s free nutritious lunch and milk programs for schoolchildren. To meet the immediate demand, the ministry will also import cattle in the short term.
Beyond addressing immediate health and education outcomes, this program also serves as a foundational step towards achieving “Indonesia Emas 2045” by fostering a resilient, sustainable livestock farming sector and stimulating economic growth for smallholder farmers.
However, smallholder cattle farming alone cannot meet the demands of Indonesia’s 280 million people. National milk demand is projected to reach 4.7 million tons in 2024, rising to 8.5 million tons by 2029, far outpacing current production capabilities.
Smallholders face challenges such as limited land, low-quality breeding stock, inadequate feed, and restricted access to technology, hindering their ability to meet growing demand.
To overcome these barriers, a comprehensive strategy and policy framework is essential. For instance, promoting cooperatives and establishing Livestock Breeding Centre Areas (Kawasan Sentra Perbibitan Ternak or KSPT), implementing Community Breeding Programs (CBP), and adopting integration of the Closed Loop model among smallholder farmers, cooperatives, and the livestock industry can empower smallholders by increasing the livestock productivity, providing better market access and increased bargaining power.
These stakeholders, including universities, can offer technical guidance, training, and resources to smallholder farmers.
Universities, for instance, could also provide research-based solutions for improving livestock health and productivity, while government institutions can facilitate access to subsidies and streamline regulations. Livestock industry can leverage economies of scale, adopt advanced technologies, and serve as hubs for innovation.
To support the ecosystem, the government should further address financial constraints by providing targeted microloans and subsidies.
For instance, the 2021 expansion of the Kredit Usaha Rakyat (KUR) or microcredit program significantly boosted small and medium enterprises, including livestock farmers, thereby improving rural productivity. Moreover, to attract private investment in livestock industry, the government can offer such as tax breaks, low-interest loans, and grants.
Through these financing strategies, both smallholders and livestock industry can achieve long-term viability while improving productivity and economic outcomes for them.
To effectively enhance the ecosystem, it is crucial to focus on value chain development by connecting farmers directly to profitable markets. This can be achieved through the promotion of certification programs that can significantly increase the profitability and marketability of their products.
Furthermore, improving transportation and storage infrastructure, particularly the development of a cold chain system, is essential for ensuring the efficient and safe distribution of livestock products. This infrastructure will help preserve their product quality from farm to market.
By balancing support for smallholders and livestock industry, Indonesia can reduce its dependence on imports, ensure food security, and foster sustainable development within the livestock sector. These efforts not only address the immediate needs of the population but also contribute to the nation’s long-term vision of becoming prosperous, self-sufficient, and globally competitive by 2045.
The writer is professor of animal genetics and breeding at the Faculty of Animal Husbandry at Yogyakarta-based Gadjah Mada University (UGM).
