Ministry to take action to help farmers


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December 10, 2006
Ministry to take action to help farmers

Andi Haswidi, The Jakarta Post, Jakarta

In order to increase farmers' productivity and incomes, the Trade Ministry is set to initiate a program next year covering capacity-building, improvements in market access and an integrated information system.

"One of our main objectives is to improve farmers' access to the retail market so that they can benefit from higher incomes through more competitive prices," Director General of Domestic Trade Ardiansyah Parman announced Friday in Jakarta.

Ardiansyah explained that most of the value of agricultural products was soaked up by high distribution costs, meaning that farmers only received less than 30 percent of the retail price.

Ardiansyah said that farmers needed improved access so that they could secure higher margins on their produce. This included providing greater access to wholesale markets. Accordingly, he explained, the ministry has been lobbying wholesale market operators (mostly local government-owned companies) to allocate more space for farmers to sell their produce directly to the retailers.

"We have begun pilot projects in three wholesale markets in West Java -- one in Garut, one in Majalengka and one in Ciwidey. Around 20 percent of the space available in these markets is allocated to farmers for selling their produce. We are currently still assessing the success of the projects in these markets. If everything turns out well, then this can serve as a blueprint for adoption for other wholesale markets around the country," he said.

"This program also benefits the wholesale markets as it leads to a win-win situation."

Market access is only one part of the program. Extension services on agricultural best practices and entrepreneurship will also be made available to farmers in collaboration with the Agriculture Ministry and non-governmental organizations, with the overall aim being to improve farmers' bargaining power.

Although still at the early stages of discussion, the program also envisages the development of an integrated information system accessible by all stakeholders in the agriculture sector.

"This system will provide information on market transactions, produce supplies and prices, as well as other essential information," he explained.

"Farmers will be able to use their mobile phones to monitor produce prices on a daily basis," he said.