Rural socio-economic issues (update 4): Kotabaru regency in South Kalimantan distributes oil palm and rubber seeds and other inputs to assist farmers who own land not yet cultivated

We'll use this posting to highlight useful information and news on social issues and concerns about rural livelihoods. What's interesting on REDD+ is that local people were presumably unconvinced and insisted on being given 1 hectare of cash crops per family in the Indonesia-Australia landmark Central Kalimantan project.  Also to highlight news items on key agro-industrial crops grown by Southeast Asia smallholders. Rubber has seen a significant fall in price as large supply has come in (notably from the expansion of growing areas in large parts of Thailand including in the North East and also in other countries). Palm oil farmers have also been worried about prices (although likely at a less critical marginal cost). Rural politics is driving significant concern and various efforts to support farmers. Rural voters are an increasingly important voting bloc in several countries.

11 February 2014: Kotabaru regency in South Kalimantan distributes oil palm and rubber seeds and other inputs to assist farmers who own land not yet cultivated

Kotabaru distributes 22,400 oil palm and rubber seed Posted on February 10, 2015, Tuesday
KOTABARU, South Kalimantan: Regent Kotabaru, H Irhami Ridjani, distributes 22,400 trunks of palm oil and rubber seedlings to farmers, Antaranews reported. ... Head of Kotabaru Plantation Agency, Ibn Bhayangkara Foen, here on Monday detailing aid in the form of 19,600 seedlings of palm oil and 2,800 rubber seedlings.... “Regent also handed one handsprayer for every five hectares of plantation land, five liters of herbicides for each hectare, as well as 50 kg of fertilizer,” he explained.... The assistance given to farmers in the sub-district West Pulaulaut and East Pulaulaut who own land and have not been cultivated to become productive land... Regent H Irhami Ridjani expresses, delivery of oil palm and rubber seedlings to the community of West Pulaulaut and East Pulaulaut is the local government’s efforts to spur an increase in the welfare of society.

7 January 2014: Thailand seeks more domestic uses of rubber in construction

Stadium floor bid to 'help lift rubber prices' Cabinet backs plan to boost local demand Published: 7 Jan 2015 at 06.00

9 December 2014: Indonesia smallholders want price floor support, cut fertilizers, seek to sell up?

Indonesia’s Palm Revolution Runs Off Track for Smallholders By Michael Taylor on 06:09 pm Nov 25, 2014, Jakarta; "A prolonged fall in the price of palm oil is hitting Indonesia’s legions of smallholder farmers, forcing cutbacks that will reduce output in coming years and raising the prospect of a bout of sell-outs to major producers....Smallholder farmers account for about 40 percent of output from Indonesia’s vast plantations that cover an area the size of South Korea. A drop in smallholder output could shave total production by around 5 percent from next year, say analysts....
Up to 1 million smallholders in the world’s top palm oil producer have enjoyed a near uninterrupted decade of boom years, fueling a rural consumer binge on new motorbikes and mobile phones.
But with prices near five-year lows some cash-strapped farmers are being forced to cut back on fertilizers, pesticides and replanting. They are calling on the government to give a sector vilified by green groups for forest destruction the type of price floor support enjoyed by rice and sugar.... “Farmers can’t increase productivity because they don’t have money,” said Mansuetus Darto, secretariat at the Indonesian Oil Palm Smallholders Union, which has 40,000 members in Sumatra and Kalimantan. “Bottom-line is — they have become poor.” But independent farmers say changes to the industry have made them more vulnerable to price falls than major players like Sinar Mas Agro Resources and Technology, Astra Agro Lestari and Wilmar International. Palm giants have integrated their businesses to include plantations and refineries, leaving smaller producers battling to sell their crops when the market is oversupplied.... “Many Indonesian planters are struggling to make ends meet as prices have already been disappointing in the past few years,” said a planter who declined to be named, pointing also to higher borrowing and logistics costs for smallholders.... In some areas on the island of Sumatra, farmers are being forced to cut the use of fertilizers and pesticides, said Carlo Nainggolan of Sawit Watch, a group which aims to protect people from exploitation by large palm firms. However, any reduction in fertilizer usage will hinder palm yields from mid 2015, pushing smallholders backwards as big firms boost yields and acreage. “If prices fall further, I would guess that we might be looking at a loss of 1.5 million tons of CPO (crude palm oil) in late 2015 and into 2016 compared with where it would have been,” said LMC International analyst James Fry....
The last time prices were near current levels was in 2008, when an eight-month plunge led to a spike in farmer suicides. Many debt-ridden smallholders were unable to pay workers and either left palm fruit rotting on the trees or sold their land... Smallholders would again look at selling their plantations, said RHB’s Tai, but the pool of likely buyers would be smaller due to uncertainties around foreign ownership and possible limits on expansion.... Smallholders want the government to support the industry with import curbs and price floors, but the month-old government of President Joko Widodo is struggling with other priorities such as cutting fuel subsidies and reducing red-tape.
“The days of easy profits with 35 percent margins for oil palm plantation companies are over,” said Howard Sargeant, director of plantations at Samuel International. “Many will have to become more cost efficient or go out of business.”

8 December 2014: Rubber farmers in Thailand - US$1.75 billion in support and demand on prices

More buying, loans to appease rubber planters Published: 8 Dec 2014 by Patsara Jikkham and Online Reporters; "The government has announced four more short-term measures to arrest plummeting rubber prices ahead of a planned protest by farmers on Tuesday. Deputy Agriculture and Cooperatives Minister Amnuay Patise The government has announced four more short-term measures to arrest plummeting rubber prices ahead of a planned protest by farmers on Tuesday. Deputy Agriculture and Cooperatives Minister Amnuay Patise said on Monday the new measures would bring the total number of solutions to help farmers to 16, costing 58 billion baht in total....
First, a cash subsidy of 1,000 baht per household with no more than 15 rai will continue... Second, the existing rubber buffer fund, with outstanding amount of 20 billion baht, will buy rubber products worth 6 billion baht at a time for exports and price support. To date, only 200 million baht... Third, credit worth 100,000 baht will be extended so each planter can invest in a side-line job without having to turn to loan sharks.... Fourth, the 1999 Rubber Control Act will be used to make sure all stakeholders are being treated fairly. Product standards will also be upgraded and cooperation with neighbouring countries sought...."

Surat Thani rubber growers to rally Published:  8 Dec 2014; Rubber planters from four districts of Surat Thani province plan a major rally in front of the city hall on Tuesday to press the government to raise rubber prices to at least 80 baht per kilogramme for rubber sheet... The announcement was made by on Sunday Pairote Rerkdee, a rubber farmer and lawyer of Ban Song in Surat Thani's Wiang Sa district who is coordinator of the  "United Front of Rubber Planters of Ban Song and Allies in Surat Thani".... Mr Pairote said at least 200 planters from Phra Saeng, Wiang Sa, Khiansa and part of Phun Phin districts would gather in front of the provincial hall tomorrow from 9am.... The united front on Sunday also issued a second open letter to Prime Minister Gen Prayut Chan-o-cha, leader of the National Council for Peace and Order (NCPO), calling for government intervention by providing subsidies to raise the price paid for rubber.... The planters demanded at least 30 baht per kilogramme for rubber scraps, 70 baht for latex and 80 baht for rubber sheets. Mr Pairote said growers and rubber tappers were really in trouble and sincerely needed help without any political agenda. If the demand was not met, rubber planters from other districts would join the gathering, which would be escalated to a higher level, he said...."

politics Rubber bill passes hurdle Published: 12 Dec 2014 at 08.02 | Viewed: 682 | Comments: 0 Newspaper section: News Writer: Aekarach Sattaburuth -+ A bill to revamp...

4 December 2014: Central Kalimantan REDD+ project had to offer "dowry" to develop 1 hectare of cash crops per family

REDD+ on the ground: For one initiative in Indonesia, politics in the peatlands; 3 Dec 2014 BY Kate Evans; BOGOR, Indonesia—It’s a cautionary tale.... The experience of a highly politicized carbon emissions reduction initiative in Indonesia’s Central Kalimantan province is a lesson in the importance of such projects communicating with the outside world, according to a new study by the Center for International Forestry Research (CIFOR).... Thousands of kilometers of canals were carved into the peatlands to drain them for what was to be the “million-hectare rice project.”...This is where KFCP was established in 2010, on 120,000 hectares between the Kapuas and Mentangai rivers....The Kalimantan Forests and Climate Partnership (KFCP)—a joint initiative of the Australian and Indonesian governments—aimed to demonstrate an effective, equitable approach to reducing emissions from deforestation and forest degradation (REDD+) in Indonesia’s largest expanse of degraded peatlands.... “In each village, it was a huge long process of negotiation,” Atmadja said. “It wasn’t just KFCP telling people what to do and then they did it—it never happens like that—communities would just reject them if they did that.”..... “Those things don’t get expressed in carbon reduced. But they are necessary for building the capacity of this community so that when REDD+ comes, people are used to this kind of negotiation.” One thing local people fought for was support for rubber cultivation and agroforestry for each household—something KFCP did not plan to provide... “KFCP wanted to improve livelihoods, but giving each household money and seedlings to plant one hectare of their own land with rubber, fruit trees or vegetables was really out of the original scope,” Atmadja said. “But local people wanted it,” she said. “And in some villages they were saying, ‘Look, this is what you call a dowry. If you don’t pay it, we don’t get married.’ ”In the end, KFCP adjusted their plans to accommodate them, Atmadja said..... This has cost implications. KFCP had a huge budget compared with many REDD+ initiatives, so was in a position to pay—but the price of local buy-in has implications for the long-term sustainability of such initiatives. Providing a “dowry” requires that proponents allow enough time for negotiation, Atmadja says, and they need significant start-up funding as well as ongoing funding—something that, in the absence of a global agreement on REDD+, is hard to secure.“KFCP’s budget was huge: $37 million for four years. … The economics may not work for other REDD+ initiatives,” she said...."