Challenge of Smallholder Certification

Transcription

1 Challenge of Smallholder Certification Dani Rahadian Hidayat SNV Coordinator Oil Palm BMP for Smallholder ISCC Technical Commi>ee South East Asia April 5, 2016

2 1. Indonesian Oil Palm Smallholder 2. Challenge for Sustainable Certification 3. Transformation

3 1. Indonesian Oil Palm Smallholder

4 Source: PPKS

5 About 10,956,231 Ha Oil Palm PlantaMon in Indonesia (2014) OP Management Smallholder OP ,404, % ,439, % ,551, % , % 0 Perusahaan Company Smallholder Petani 0 Swadaya Independent Plasma Scheme Sources: RSPO market data Ditjenbun, Kementan 2014

6 Sustainable Independent Smallholder (ISH) CerNfied and Non CerNfied ,439,864 ha Non CerNfied CerNfied 1,182 ha 0,034 % Source: RSPO, 2016

7 Independent Oil Palm Smallholder (ISH) Categories 1. Beginner (individual) Small Scale Smallholders 2 5 ha Big holders > 25 ha 3. Advance with strong farmer organizanon 2. Intermediate with weak farmer organizanon Medium Scale smallholders 5-25 ha

8 2. Challenges for Sustainable Certification

9 1. Credit Lack access to 2. Insurance OP Independent Smallholder 3. Agro- input Farmer Organiza?on Good Agriculture Prac?ce Increasing yield BeHer income Transforma?on 4. Informa?on 5. Market Social & Environmental Aspects Quality Control Sustainable Produc?on

10 Beginner ISH - In- efficient Marke?ng Palm Oil Mill Intermediary 1 as Market Intermediary 2 as Market Farmer 1 Farmer 2 Farmer 3 Farmer 4 Farmer 5 Farmer 6 Farmer 7 Farmer 8

11 Intermediate ISH - Farmer Group Association Head of Farmer Group Associa?on Secretary & Treasury Internal Control System Farmer Group Farmer Group Farmer Group Farmer Group Farmer 1 Farmer 2 Farmer 3 Farmer 4 Farmer 5

12 Advance ISH - Cooperatives - efficient marketing Head of Coopera?ves Secretary & Treasury ProducNon Business Unit Lending Business Agro- input Business Unit TransportaNon Business Unit x Internal Control System ISH Farmer Group Farmer 1 Farmer 2 Farmer 3 Farmer 4 Farmer 5

13 Internal Control System (ICS)/Quality Control Approval Commicee Manager Group Internal InspecNon Extension Tradings Oil Palm Smallholders as members

14 Cost Structures CerNfied FFB Conventional PracNce Net Revenue Conventional PracNce Sustainable Practice Sustainable Net Revenue Conventional pracnce cost ICS Group cernication standard operanonal cost * Quality compliance Direct cost for cernficanon (Audit/Surveillence) Membership cost

15 Independent Smallholder Palm Oil Value Chains Intern anon al donor s organ izano n Banks Smal lhol der grou p cern fican on NGOs Gover nmen ts External parnes Eco sensitive consumers Smallholder ISCC cernfied ISCC cernfied palm oil mills Commiced Manufacture to source only ISCC cernfied Commiced retailers to source only from ISCC cernfied Intermediary

16 External parmes to independent smallholder value chains Find access to start up! Banks InternaNonal donors organizanon Smallholder group cernficanon Governments NGOs

17 CerNfied Mill Scheme Smallholder Independent Smallholders POM CerNfied mill Non cernfied Mill Non CerNfied mill, higher prices CerNfied mills, lower prices

18 3. Transformation

19 Transformation Legality, biodiversity, social Conventional agriculture methods

20 Method: Responsible sourcing from smallholder Combining demands from buyers for risk minganon in supply chains with support to smallholders to help them improve their livelihoods and producnon The unique approach of the RSS is that it combines two components or pillars, both of which must be implemented.

21 Inclusive Business Tools: High Impact Training development Process 1. Design Design the training model and templates: Set criteria for trainers, select writers Design templates 2. Development Development of Training Materials Write training materials Graphic design of training materials TesNng training materials 3. Delivery Delivery of training Training of Trainers Training of Beneficiaries Assessing Beneficiaires Support beneficiaries 4. Determine Effec?veness Determine effec?veness of training Trainee course evaluanons M&E structure and processes

22 Example: Better Management Practices for Palm Oil Farming Poor practices in Palm Oil Farming leading to low yields High Impact Training in Better Management Practices for Palm Oil Farming lead to high yields

23 Training modules development for smallholders in progress 1. Cooperatives Development 2. Farmer Group Development 3. Internal Control System (Quality Control) Development 4. Access to finance

24 Thank you for your acennon Contact: Mobile