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Marketing with Farmers

24/11/2021

The classic problem faced by Indonesian rural communities, especially those who work as farmers, is the difficulty of accessing capital for community agricultural production activities to formal financial institutions, such as banks. Various things and breakthroughs were made by the government to overcome this problem. Various small-scale soft loan schemes were forced on banks to address the challenges that these small farmers need.

Internally, farmers have their own problems regarding access to capital to these banks. From the legality of the farming business being carried out, the official documents that are not owned, the guarantees imposed by the banking system are the same as the general business which makes farmers who still use the traditional pattern unable to fulfill the various requirements.

The same is true for mixed crop planters (polyculture) in the highlands of the Sibolangit area, Kab. Deli Serdang, North Sumatra. Capital is an obstacle for farmers to develop polyculture gardens that strongly support managed natural sustainability.

The people here practice traditional farming patterns that are very friendly to nature, wise and support the ecosystem, because with various types of plants in one stretch, this system will keep various kinds of animals alive because of the availability of food chains for flora and fauna that live in nature.

Development of Rural Skills (BITRA) Indonesia, together with farming communities in 3 sub-districts, namely Sibolangit, Pancurbatu and Namorambe with a (currently) 21 polyculture farmer groups consisting of 458 families with a land area of ​​approximately 550 hectares, developing community gardens with a polyculture pattern with priority for cocoa plantations, in 1997.

This polyculture concept, where the community still maintains their habits with traditional gardening, but intensifies so that the existing land can be productive and have high economic power on land yields.

Polyculture is an agricultural system or agricultural model that is economical, ecological, cultured, adaptable and humane. This agricultural model is also known as a sustainable agricultural model. The polyculture farming model is a total correction to the monoculture farming model which is very detrimental to natural ecosystems.

Because the expanse of garden land is crossed by 2 rivers, namely the Peasants river and the Betimus river, the community also gathers in an organization that aims to conserve the river, which is called the River Concern Community Forum (FMPS) which builds a river conservation system and collects fish collectively for a long period of time. specified time. FMPS also makes rules and prohibitions on mass and destructive fishing, such as using fish bombs, stuns and poison (tuba) but fishing, fishing and netting are still justified, if there are residents of their village or other villages who continue to violate the prohibition, sanctions will be imposed. morally and socially imposed. The community termed the conservation of the river and its biota with the term Lubuk Larangan. The community also does river clean work (from non-organic waste) once a year.

Various organic wastes and skins (tubers) of cacao pods are used as organic fertilizers by a process of decomposition with natural ingredients made by themselves. The various techniques for organically cultivating polyculture gardens are obtained by farmers from the polyculture field school (SL-Policulture) which is carried out regularly and continuously for each polyculture farmer group in turn. SL-Polyculture that has been carried out has also resulted in an initial module of SL-Polyculture which is compiled from the results of the farmers’ own field experiences. This module is also open to be developed in the future based on new needs, situations, conditions and changes in natural climate. It is also hoped that the module, which is an initiative for mixed polyculture plantations, can be adopted by other smallholders throughout Indonesia, with a typical traditional mixed crop garden similar to the upland areas in North Sumatra.

On the other hand, farmers are no longer day laborers in other places or drivers because they can take care of and work on their gardens, which demands a fairly high continuity of daily activities. In the concept of polyculture, farmers are advised to plant more than 4 types of perennials in one garden. Besides that, other farmers in the vicinity must also plant local food sources such as rice to meet basic needs so as not to depend on the availability of food from the market.

Johan Pinem, a polyculture farmer from Namo Pinang village, Namorambe district, said, “With this polyculture farming, the people here feel safer and are more active in taking care of their gardens. Economically safe, because we can now harvest crops almost every day. Namely, palm juice is tapped every day, Barangan bananas and cocoa every week have yellowing fruit, areca nut & gelugur every month some can be taken down from the tree, rice starts to turn golden every 6 months, durian, mangosteen and duku are harvested every year.” .

“Similarly, when the price of one agricultural product is cheap due to market price fluctuations, for us this is not a problem, because the price of other commodities must be high.” Added Johan on the sidelines of making organic fertilizer from media soil. Johan raises worms and their droppings near the cowshed, behind his house.

Post Production Problems

Four years after the community planted their cocoa, now the fruit that is very popular in the European market is starting to produce abundant production, but polyculture farmers are facing new problems, namely:

  1. Pricing is determined by agents, traders or middlemen who arbitrarily and always do not comply with the standard price of cocoa sales.
  2. The marketing chain is leveled up to export, starting from collecting traders, village collectors, sub-district collectors, (there are also Regency collectors), then provincial collectors, and exporters.
  3. There is no togetherness, unity and collectivity of farmers in market management (post-harvest) or off farm.
  4. The number of farmers who depend on middlemen, namely borrowing money from collecting traders with the obligation to sell their products to middlemen who lend money to farmers.

Thus, although the polyculture farmer group program for the intensification of traditional gardens with cocoa plants was successful, it has not yet fully contributed directly to improving the welfare of farmers.

In 2005, initially led by 6 highland polyculture farmer groups, they conducted intensive discussions to address this problem. From several series of discussions in which more and more polyculture farmer groups joined this discussion, a village resolution was born with important points:

  1. Cocoa farmers with mixed crop patterns (polyculture) must determine their own production prices.
  2. The very long marketing chain must be cut in a way that farmers can sell directly to exporters as a learning stage for farmers who in the long run aspire to export their products directly with a fair trade scheme & organic certification. Another option from this point is that farmers aspire to create a small factory for semi-processed cocoa (cacao powder & cacao cream) to increase added value.
  3. Farmers must unite in a joint marketing platform through cooperatives to handle their post-harvest products.
  4. Farmers must gradually reduce dependence on middlemen to 0% in the future.

Realizing the Village Resolution
To realize the village resolution, a large deliberation was held, where the participants were cross-members of farmer groups and women (farmer’s wives). From the deliberation it was agreed that all existing polyculture farmer groups (at that time there were still 18 groups) established informal financial institutions in groups independently. The Credit Union (CU) pattern is an option.
After 1 year, all polyculture farmer groups have CUs managed by mothers, women and farmers’ wives, a forum was established to accommodate all informal financial institutions in their respective villages, so that more capital can be collected. On the basis of deliberation and mutual agreement, the People’s Economic Strengthening Forum (FPERa) was born.
On the other hand, to organize off-farm marketing institutions, farmers began to gather and establish a cooperative called the Farmers’ Joint Marketing Cooperative (KPBUT) in 2006 with a 4-year management period.

The following month, an auction market trial began in the home page of one of the cooperative members. Initially, there were only 6 polyculture farmer groups consisting of 18 representative members from each farmer group, only 3 people selling their polyculture garden products to this trial auction market. The total result of the purchase of the primary auction market is only 591 kg.
At the deliberation prior to this initial trial auction market, it was mutually agreed upon, that parking funds for each CU group were collected by FPERa to finance the purchase of equipment for the auction market operation and initial capital for purchasing cocoa produced by members.
“We are very grateful that with the women’s CU group and FPERa, finally the initial capital for organizing this auction market can be carried out.” Said Pelita Br Barus, Head of FPERa and as interpreter for quality and moisture check at the auction market committee, in April 2010, in between his busy schedule of checking the quality and moisture content of cocoa, when the auction market was held at the auction hall.
Then the group members continued to increase over time, the polyculture farmer group assisted by BITRA Indonesia in the area (another sub-district) began to hear about the auction market for farmers’ independence which was held in Sayum Sabah village, then other polyculture farmer groups became interested in the idea of ​​togetherness. This is to sell their cocoa products in the auction market and join KPBUT.
Now the cocoa auction has been participated in by 21 polyculture farmer groups in 3 sub-districts, located at the Auction Hall which was built by the Department of Industry and Trade of Deli Serdang Regency, specifically for the implementation of the auction market for polyculture farmers around the highlands, built right at the center of smallholder cocoa producing polyculture gardens.
“This auction hall building is very helpful for the auction activities carried out by the community. Various standard mechanisms for technical testing of the quality, quality and content of water contained are also carried out on the day of the auction market, technical tools and water content testers are also available at this auction hall”. Said Pelita Br Barus.
Farmer’s auction market is an organized market as a place where sellers (farmers/groups) meet with buyers (exporters) to conduct transactions with the auction system. The existence of the Farmers Auction Market is one of the activities to facilitate the establishment of an integrated marketing mechanism from the production process (on farm) to the post production process (off farm) which is supported by a transparent information flow mechanism from the market level to the producer level.
The implementation of the farmer auction market is carried out so that price offers are transparent in accordance with the quality of the products traded (market segmentation), the marketing system is becoming more efficient so as to improve the bargaining position of farmers, and the selling price of agricultural commodities/products increases and the income of producer farmers also increases.

“This way, we farmers can determine our own prices.” said Berngab Gurusinga, Chairman of the KPBUT. “The price we obtained through the auction is among the highest prices on the general cocoa market at the farmer level in North Sumatra”. Add Berngab.
The auction market mechanism has been regulated in the provisions of the auction market that apply nationally, as stated in the Decree of the Minister of Industry and Trade Number 650/MPP/Kep/10/2004 concerning Provisions for the Implementation of the Auction Market.
Meanwhile, what is practiced at the KPBUT auction hall is simpler, namely when the auction day is held, exporters (as potential buyers who are participating in the auction) or auction participants who are interested in buying community cocoa are expected to come to the auction hall and offer their price openly, but for exporters who are unable to come but are still interested in becoming bidders, bids will be made by telephone. The highest bidder will be the winner of the auction and will be entitled to buy all of the farmer’s cocoa at that time.
The average difference in price obtained by farmers participating in the auction compared to the general price is Rp. 1,000 to Rp. 3,000 per kilogram. KPBUT managed to collect cocoa from its member farmers 6 to 8 tons per month, or 3 to 4 tons every 2 weeks when the cocoa auction market was held.
The problem faced is that not all members of the group sell their cocoa in the auction market because in the highlands area where most of the population is Karo tribe, they have a weekly custom every Monday, where stocks of various household needs for a week must be purchased this week. So that some farmers have to sell their cocoa to cocoa buying agents, not at the auction market, because of the urgent need.
“The auction market should be held once a week,” said Ucok, a polyculture farmer from Namo Pakam village, expressing his hope.

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Data Kelompok

Kab/Kota Lk Pr Jlh Jlh Kel
Langkat 173 142 315 12
Binjai 26 31 57 3
Deli Serdang 783 766 1549 31
Serdang Bedagai 815 620 1435 49
Tebing Tinggi 36 126 162 5
Batu Bara 26 170 196 5
Lab Batu Uatara 490 306 796 2
Jumlah 2349 2161 4510 107