Increasing Rice Farmers’ income in Central Java

Indonesian rice farmers have a weak position in the supply chain. Simultaneously it is difficult to enter new markets independently. The farmers can now join a so-called LDPM, a business organisation of rice farmers. This union increases their chance of strengthening their individual position.

Subsidy
An LDPM receives government funding as part of the Facility for Sustainable Entrepreneurship and Food Security (FDOV), which is a program of the Netherlands Enterprise Agency (RVO.nl). An LDPM assists their members and is responsible for the procurement and marketing of rice. However, there is room for improvement. The LDPMs need further professionalization to become strong business organizations with know-how, capabilities, and influence. The next step is to further develop a B2B relationship among its value chain stakeholders, and to take the financial and marketing capacities to a higher level.

Public Private Partnership
ICCO has identified potential public and private partners to improve the production and marketing of high premium rice in Central Java. The PPP consists of 1 government body, 3 private sectors, and 3 NGOs. Objective of the PPP is program implementation, training, motivation, and coaching of 10,000 farmers to use certified seeds and organic fertilizers and pesticides amongst others. Other topics that are addressed are entrepreneurship, business plan development, institutional management, networking, and marketing.

LDPM program can make a difference
Once an LDPM becomes a strong business organization, farmers can free ride on their know-how, capabilities and influence. The program offers special attention to women. Their work in the harvesting and post-harvesting period is all hand-labor and largely underpaid. It will strengthen their position if they become the owner of harvest equipment.