overview on agri-food processing & smes in...

1Purwiyatno Hariyadi …. [email protected]

Workshop AIC Food & Agriculture ClusterIPB International Convention Center, Bogor, 23-15 February 2015

Overview on

Agri-Food Processing & SMEsin Indonesia

Purwiyatno HariyadiSoutheast Asian Food & Agricultural Science & Technology (SEAFAST) Center,Bogor Agricultural UniversityBOGOR, INDONESIAphariyadi.staff.ipb.ac.id


Overview on


Presented at - WORKSHOP Australia Indonesia Center (AIC)-Food & Agriculture

Cluster, 23-25 Feb 2015, IPB BOGOR



Keywords(What I’ve heard and learned so far…………)

- SMEs (MSMEs)?- Food security?- Trade (international trade)?- Global value chain?

- Shared interests – Shared challenges?- etc.

Overview on



GDP Growth of Manufacturing Industries Non-Oil/Gas in 2007 - 2013

Source : BPS , calculated by Kemenperin

Industry 2007 2008 2009 2010 2011 2012 Q1 2014*

Non Oil Industry 5.15 4.05 2.56 5.12 6.74 6.4 5.56

F&B + tobacco 5.05 2.34 11.22 2.78 9.14 7.74 9.47

*temporary

Overview on




Enterprises Classification

Law No 9, 2005

Micro•< IDR 200 Mio•1-4 employees

Small•IDR 200 Mio– 1 B•5-19 employees

Medium•IDR 1 – 5 B•20-99 employees

Large• IDR > 5B•> 100 empl


LE

Micro E

SE

ME

Micro, Small & Medium

(MSME) =48.93 Mio Units

Pyramid of Enterprises (BPS 2006)



LE

Micro E

SE

ME

0.1%

99.9%

Pyramid of Enterprises (BPS 2006)


99.9%

0.1%

Employments

GDP

1778.75 T IDR(53,28%)

46,72%

85,7 Mio(96,18%)

3,82%

Tilted : 96% absorption of employmentsBUT, “only” contributes to 53% GDP.

Characteristics of MSME (BPS 2006)



53,57% MSME: Food & Agriculture sectors

0.1%

53,6% 46,4%

Characteristics of MSME (BPS 2006)

Food Security


Food Security is the fulfillment of food for the state up to the individuals, that is reflected by food availability that is sufficient, both in quantity and quality, safe, diverse, nutritious, prevalent and affordable as well as not conflicting with religion, belief and culture, to live healthy, active and productive in a sustainable manner.

Food Law No 18, 2012

Food Security



Food Security is the fulfillment of food for the state up to the individuals, that is reflected by food availability that is sufficient, both in quantity and quality, safe, diverse, nutritious, prevalent and affordable as well as not conflicting with religion, belief and culture, to live healthy, active and productive in a sustainable manner.

Food Law No 18, 2012

Food SecurityKeywords of


Food SecurityAssuring

Intake sufficiency Quality of household food processing,

sanitation and hygiene Quality of drinking water Quality of child care

Consumption sufficiency

Physical, economic and social accessibility Compliance to preferences Compliance to food habit and culture Compliance to belief and religion

Accessibility

Quantity Quality Nutrition adequacy Variety Safety

Food availability








Accessibility


Food availability

Food Quantity: prerequisite of Food Security

Quantity

1


Food SecurityAssuring Food Quantity:

prerequisite of Food Security

Issues of Agri-Food Processing and SMEs in assuring food quantity:

- Availability of raw material? import?- Availability of ingredients? Esp. Functional

ingredients import?- Availability of packaging material? import?- Availability of machineries ? import?- ?????

1








Are these shared interests/challenges?

1







Are these shared interests/challenges?

1






IF …..YES, these are shared interests/challenges

1 How AIC Food & Agricultural Cluster can do about this?



- Value-adding partnership?- ETC


Addressing

How AIC Food & Agricultural Cluster can do about this?

1




- Development of intermediate ingredients (of Australia & Indonesia interest)?- Dried fruits? - Dried/powdered herb/spices, local flours

(tubers, roots, etc.)- ETC


Addressing


1



- Development of local food ingredients (of Australia & Indonesia interest)?- Tropical fruits-based ingredients (extracts,

flavors, concentrates, etc.)- Starch-based ingredients (modified starch,

thickeners, etc.)


Addressing


1




- Development of local food ingredients (of Australia & Indonesia interest)?- Tropical fruits-based ingredients (extracts,

flavors, concentrates, etc.)- HHP (CSRIO)


Addressing


1



- Development of local food ingredients (of Australia & Indonesia interest)?

- Soybean? Cattle??? SCE???- Jambi? Sulawesi???


Addressing


1





- Soybean? Tempe?- Development of “tempe technology”, high value

product, high value ingredients, etc.


Addressing


1




- Cattle? Meat?- Development of “cattle-industry”????


Addressing


1








Accessibility


Food availability

Food Safety: prerequisite of Food Security

Safety

2


Food Safety ?

FOODSECURITY

?

• Indonesia : Double Challenges of Food Safety

2



FOODSECURITY

?

• Indonesia : Double Challenges of Food Safety

Food Safety ?2


Challenges of “Domestic” Food Safety

• Microbial problem unsanitary conditions• Uses of unsafe-chemicals• Unsafe use of food additives

Food Safety ? – domestic issues2



Roots of the problem?• Poverty lack of foods• Food production system is dominated by

SMEs (and household industries)• Lack of basic food safety infrastructure

(clean water, clean ice, cold chain system, etc.)

• Lack of capacity of human resources (Producers, consumers, government officials)

• Lack of funding

Food Safety ? – domestic issues2


• Global food trade will likely to increase due to expected increases in global income levels

• Consumers take advantage of lower prices and greater seasonal availability of some foods abroad

• ~ global value chain

Food Safety ? ... International Issues?2



• World Integrated Trade Solution Database (http://wits.worldbank.org/wits/gpfad.html)

• Already ~ 40% of all trade in food agriculture, fisheries occurs between developing & developed countries



Indonesian processed food products of export (MOT RI, 2010)




Food Safety ? ... International Issues?Indonesian processed food products of export (MOT RI, 2010)

2


Food Safety ? ... International Issues?

• United Nations Industrial Development Organization (UNIDO)

• Norad – Norwegian Agency for Development Cooperation

• Institute of Development Studies (IDS), Brighton, UK

2



Number of

EU rejectionsof food and

feed exportsfrom Indonesia,

2002-2008



Number of

US rejectionsof food and

feed exportsfrom Indonesia,

2002-2008




• Driving forces for trade is economic gain

International trade is important for economy of developing country

However, increasingly restrictive/stringent international food safety standard

Limit market access

Could incur significant export/income loss



For Indonesia, average number of rejection each year:• 40 for the EU,• 377 for the USA,• 38 for the Japan, and• 50 for Australia







WHY?•Quality•Safety

~ MSME Issues ?





WHY?•Quality•Safety

~ MSME Issues ?



????? Are these shared interests/challenges?




????? Are these shared interests/challenges?

YES…..The shared interest/challenges:

How to make Indonesia-Australia stronger (& trusted) trading Partners(reducing export refusals)



If YES… Is there any AIC scheme to address this2

?


Empowerment /capacity building program?




Empowerment /capacity building program?



2 Empowerment /capacity building program?

If YES… Is there any AIC scheme to address this



2 Empowerment /capacity building program?

If YES… Is there any AIC scheme to address this


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overview on agri-food processing & smes in...

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