Monday, October 28, 2013

Aceh Timur: What's *really* out there?

The picture of Aceh Timur develops, as JMD’s intrepid field officer Robert’s good relationship with the district’s head of the Forestry and Plantation department yields the first set of answers to our questions.

You heard it here first, folks: first-hand responses--not surveys, reports, research articles, or data syntheses. We gave Robert some guidelines and he developed these questions himself, and reported back. My comments are in brackets, in red.

What are the main commodities in East Aceh/Aceh Timur?
Palm oil, rubber and cocoa. Communities in Eastern Aceh evaluate a commodity not only on the basis of their own cosumption but on the ease of production, maintenance and marketing.

Which of these is the easiest to cultivate and which one has the highest production?
The main commodity that communities and small and large companies are mostly interested in in Aceh Timur is palm oil. Palm oil trees are easy to maintain, have comparitively fewer pests and disease problems, and from a smallholder business perspective, palm oil is easier to market (since the production demand is so great).

But in terms of how profitable the commodity is, cocoa fetches the highest price. It’s the hardest to miaintain, however, due to pests and diseases. “That is why,” says Robert, “not many farmers are developing cocoa except those who really love farming cocoa.”

[One of the goals of this project: Give farmers in Ace Timur the tools and training necessary to be able to keep doing what they love.]

From 2010-2013, the ministry of forestry and agriculture promoted palm oil farming by distributing about 252,000 trees over 300,000HA in Aceh Timur.

[that’s less than 1 tree per HA but still, it shows that there are 300,000 HA worth of smallholders out there who are growing palm oil trees for the large palm oil companies.]

As for cocoa, in 2010-2013, the ministry distributed 20,000 seedlings to farmer groups in 5 subdistricts in Aceh Timur: Idi Tunong, Darul Ihsan, Idi Rayeuk, Pate Bidari. However, the ministry could not develop the same project to other sub districts due to land dispute issues with a farming company --PTPN 3 in Sungai Raya and Bireun Bayeun sub-districts.

[I’ve since learned that this company is a palm oil/rubber concern that somehow forced or convinced the government NOT to provide cocoa seeds in Sungai Raya and Bireun Bayen.

Translated from their (Indonesian) site: PT Perkebunan Nusantara III, abbreviated PTPN III (Limited), is one of 14 State Owned Enterprises (SOEs) engaged in the cultivation, processing and marketing of palm oil . . . and rubber plants. The Company's main products are Crude Palm Oil (CPO) and palm heart (Kernel) and the downstream rubber products. 

PT Perkebunan Nusantara III (Limited) was established by the Notary Aaron Kamil, SH. 36 dated March 11, 1996 and was approved by the Minister of Justice of the Republic of Indonesia Decree No.. C2-8331.HT.01.01.TH.96 dated August 8, 1996 which was published in the Official Gazette of the Republic of Indonesia No.. 81 In 1996, Supplement No.. 8674 of 1996.. . . Around the world, Sumatra[is] known as a producer of high-quality rubber, more than 54,000 hectares of land [of] PT. Perkebunan Nusantara III (Limited) produce the best quality rubber in the world. Product quality RSS-1, SIR-10, SIR-20 and Concentrated Latex able to penetrate the international market, the largest tire manufacturer in several like Bridgestone, Good Year, Firestone, Han Kook and others.

This is my opinion only, but I would think that such a large palm oil concern would have no problem sharing space with a small traditional farming resource. Doubly troubling is a report from USAID that I just found online, which I will have to read and get back to you on—and then call USAID. Called BACKGROUND STUDY: REPLICABLE AND SUSTAINABLE USE OF PALM OIL WASTE BY-PRODUCTS FOR EMPLOYMENT CREATION, RESOURCE CONSERVATION, AND BIOFUEL PRODUCTION IN ACEH, the title alone sounds like USAID has also leapt into bed with palm oil under the assumption that it is indeed possible to appropriately regulate and monitor this industry in the middle of the jungle where no regulatory or monitoring body has yet to go. Remember my post concerning the Malaysian Palm Oil Consortium’s self-created regulations and how no agency or organization could tell us who, exactly, was going to insure that these regulations were being met? So now I learn that USAID came on board in 2009. Certainly the title suggests that the report is interested in what kind of good things can be made from production waste—but I wonder if it is at all concerned with the actual intended product and how it is produced. I mean, we can all be really happy that they make recycled purses from plastic bags and doormats from truck tires, but what about the creation of these things in the first place—wouldn’t that be the thing to study?

I’ll get back to you. The thing is 91 pages long. Just when you think you know who your pals are . . . ]

Where are the Central areas for rubber?
Nurussalam, Rantau Panjang Peureulak, Indra Makmur, Idi Tunong, Darul Falah, and Bireun Bayeun [one of the no-entry districts for cocoa]. Can you name the companies that are growing/manufacturing rubber in the district?
The P3 company located at Rantau Panjang Peureulak, which is now replanting palm oil plantation with rubber. The Patria Kamoe company is located in Julok sub district. A big rubber company is PTP 1, located in Rantau Panjang Pereulak and Julok subdistricts. PTP 1 also has a palm oil department. How big are the rubber plantions?
The forestry ministry does not have any land data of PTP 1 ,P3 or Patria Kamoe since these companies never report their data to the forestry agency in Eastern Aceh. [how convenient for them.] Where are they located?
The PTPN3 company is located at Rantau Panjang Pereulak subdistrict, Patria Kamoe is in Julok subdistrict, and PTP 1 company has four locations: Rantau Panjang Pereulak subdistrict, Sungai Raya subdistrict, Bireun Bayeun subdistrict, Julok subdistrict.

How many workers are hired by these companies?
These companies do not report the number of their workers to the forestry agency of Eastern Aceh. [nice.]

Does community itself have rubber plantations?
Yes, the community-owned rubber plantations are between 0.5 Ha to 3 Ha (1-8 acres). According to the Forestry agency, in total there are 21,367.50 HA of community rubber plantations (about 50,000 acres)

What is the biggest challenge for [smallholder] rubber farmers in Eastern Aceh?
Minimal knowledge on Rubber cultivation, post-harvest treatment, pest control. Rubber seedling planted are not the best seedlings, since the good ones cost more to buy or have the government distribute. The trees are too old, and due to a pricing scheme on the part of the collectprs, smallholders cannot increase their prices. [in other words, it’s the same issue for smallholder rubber farmers as for cocoa farmers, only in the case of rubber farmers the gvernment did, several years ago, establish rubber plantations in communities. But as we found out when we talked to Bumitama in Kalimantan, rubber is not atraditional or a desired crop to grow, so these “gifts” did not prove at all worthwhile.]


How many HA are covered by cocoa plantations in Aceh Timur?
12.415,50 HA. (about 25,000 acres).

Where are Aceh Timur’s main cocoa areas?
The most central areas for cocoa are Peunaron sub-district, Sungai Raya sub-district, Rantau Panjang Peureulak sub-district, Serbajadi subdistrict, the Peudawa district, Darul Ihsan subdistrict and Pante Bidari subdistrict. [We are desperately trying to help JMD get funding to do a similar cocoa initiative in Pante Bidari, which we surveyed this past march and found lots of enthusiasm, wonderful opportunity, and not a drop of support or encouragement given—ever—to these local farmers trying to reclaim their livelihood. No, I take that back. The mistry did distribute cocoa seedlings once, but there was no training and no follow-up, and farmers there can’t take advantage of their resource.]

How many farmers are running cocoa farms?
There are 11,590 farmers all over Eastern Aceh

How many kg per HA of cocoa is produced?
Annually, Eastern Aceh produces 6,536 tons of dried cacao beans a per year, averaging 770.73 Kg (1600 pounds)/Ha.

Are there any cocoa companies in Eastern Aceh?
In 2006 Patria Kamoe grew coco in Serbajadi subdistrict, however after the conflict between Indonesian Government and GAM in Aceh, they changed the focus to Rubber and palm oil. [oy!]

Is there any exporting company that buys cocoa from farmers directly?
No, all the cocoa in Aceh Timur is purchased by collectors. We have small and big scale collectors, and small –scale collectors are located all over Eastern Aceh while the big-scale collectors are located in Peunaron subdistrict, Idi Rayeu subdistrict, Peudawa subdistrict and Pante Bidari subdistrict. The big-scale collectors sell their dried cocoa beans to big exporting companies in Medan such as Cacao Venture in North Sumatera ( Medan). [The small-scale collectors, like the ones in Simpang Jernih, sell the beans to larger companies in Kuala Simpang (Aceh Temiang ext door.]

What is the biggest challenge for cocoa farmers in developing cocoa farming business in Eastern Aceh?
[Robert did an extensive survey report in March of this year: these are his findings:]

Farmer Problems Identified by Farmers

  • The implementation of appropriate Cacao Cultivation technology is needed.
  • There is still a practice of fertilizing the tree without paying attention to the age of the cacao tree and the needs of the cacao tree.
  • Fertilization process is conducted once a year, with one tree receives 1.5-3 kg
  • Fertilizer used is still a chemical fertilizer
  • Cacao Productivity is still considered low
  • Harvest and post-harvest treatment has yet maximized.
  • Farmers who market their produce without drying their cocoa beans sell with only Rp. 3000 – Rp.5000 /kg
  • Farmers do not do Business Farming analysis when cultivating their cacao tree
  • Cacao Quality is still under the export standard
  • Cacao plantation is still considered as the part-time livelihood
  • The smallholder owned cacao plantation has to be saved as they have converted the land to other plantation; farmers are tired of treating their cacao trees from the attack of pest and disease.
  • Lack of Human resources at the forestry and plantation agency that understand cacao cultivation practice.

Palm oil

How big is palm oil plantation in eastern Aceh?
According to data in the forestry ministry, eastern Aceh has 19,797.50 HA of palm oil plantation. [However, this is just the amount of land owned by smallholders, since Palm oil companies never gave data on how big their lands are although they have License to Perform Business.]

Why do they not give out this information?
The forestry department says it “does not know.” [Well, I can guess!]

How many palm oil companies are in Aceh Timur?
There are 15 companies with License to Perform Business to develop palm oil plantation in Eastern Aceh. 6 of them own plantations and factories to process palm oil, while five companies are middle-scale companies owning only processing factories and collecting palm oil, four palm oil companies do not own factories processing palm oil.

Palm oil Company name
Karang Inoeng
Tualang  Sawit 
Rantau Peureulak
Bireun Bayeun
PT. Mapoli Raya
Aluer The
Bireun Bayeun
-but let’s assme
PT. Damar Siput
Damar Siput
Rantau selamat
It’s all in the
PT.Patria Kamoe
Gajah Mentah
Rantau selamat
tens of thousands . . . ]
PT. Wira Perca
Bukit Angkop
Ranatau selamat
PT. Banda Aceh Jaya
Rantau Peureulak
PT. Beurata Maju
Bandar Baru
PT. Dani Putra Nugra Utama
PT. Arco
Aluer Buloh
Bireun Bayeun
PT. Atakana Company
Rantau Pereulak
PT. Bayu Puba Sawit
Alue Dua
PT. Aceh Loka Makmur Sentosa
PT. Bumi Flora
Idie Rayeuk
Idie Rayeuk
PT. Blang Kara Rayeuk
PT. Para sawita

How many workers palm oil companies hire?
NO data

Do palm oil companies in Eastern Aceh receive produce from community–owned palm oil farms?
Yes, farmers sell their palm oil produce to collectors in villages, as well as to collectors in subdistrict centers, and farmers who own more than 5 ha land of palm oil sell their produce directly to companies

What is the biggest challenge for farmers in relation to palm oil companies?
There are conflicts between communities and palm oil companies [which I will get into later]

Are palm oil farmers happy with palm oil companies in eastern Aceh?
Farmers are happy in that they are able to sell their produce to the companies.

Is there a conflict in the community, especially among the rubber growers, cacao farmers and palm oil farmers with companies , especially on large land managed by companies?
  • Community land grabbing by companies
  • Land dispute with communities
  • Community eviction by corporates from villages caused by unclear land borders of Right to Perform Business (RPB)
  • No assisstance from farming companies for farmers in Eastern Aceh

Remember, the majority of this information came from the ministry in charge of this type of agriciulture.


For those of you following this topic, let me be clear: the opinions expressed here are mine as the president of BBF, which is a donor of JMD, and as a private citizen. I am deeply vested in the success of JMD and so I am concerned with their ability to do good and lasting work in the field. But this blog represents MY opinions and not those of the JMD staff, associates or beneficiaries. I am told that it may be quite dangerous to investigate big palm oil and the attendant destruction it causes in the rainforest. I obviously don’t have all the facts yet. As you can see, something pops out of the woodwork every day, like the document from USAID, and it adds to my understanding of this complicated issue. But these forays into destructive agribusiness are at my discretion and in no way represent the opinions or actions of Jembatan Masa Depan.

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