ADB ESLAP case study
‘dairy value chain in Indonesia’
Marion de Vries, Wageningen Livestock Research, the Netherlands
June 28, 2021
Webinar ADB Sustainable Livestock

Demand for dairy in Indonesia
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• World's fourth most populous nation
• Java: >50% Indonesia’s population, 98-99% of dairy cows
• Increasing demand for dairy:
• Rising per capita dairy consumption (growing population,
dietary shifts)
• National ambition to increase domestic milk production
from ~20% to 50% of consumption*, by:
• increases in national cattle population
• Increases in productivity
*Roadmap Indonesian dairy sector 2015-2025

Indonesian dairy sector
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• Domestic milk production 1.0 Mt/y
• 0.6 M heads, ~192.000 dairy farms
• Urban/peri-urban
Smallholder farms (~90% cattle, ~77% milk)
• 3-4 cows, 8-10 L per cow/d, long calving intervals
• Zero-grazing, 0.2-0.3 ha of land
• Feed ration: forage, concentrates, industrial by-products,
crop residues
Large scale farms (~10% cattle, ~23% milk)
• >1000 head, ~20 L per cow/d, shorter calving interval

Key sustainability issues
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1. Sub-optimal herd productivity and efficiency, causing:
• low milk and meat output, high feed cost, low margins
• relatively high GHG emissions per kg milk
• low resource use efficiency (feed, nutrients)
De Vries et al., 2019; Apdini and Zahra et al., 2021;
Zahra, et al. 2021

Key sustainability issues
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1. Sub-optimal herd productivity and efficiency, causing:
• low milk and meat output, high feed cost, low margins
• relatively high GHG emissions per kg milk
• low resource use efficiency (feed, nutrients)
2. Manure discharging (60-90%) and overfertilization, causing:
• pollution of local ecosystems and drinking water sources
• biodiversity loss
• increased GHG emissions
• local nuisance
De Vries et al., 2019; Apdini and Zahra et al., 2021;
Zahra, et al. 2021

Manure discharging & overfertilization
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Manure management

Disconnection of land and milk production
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• Scarcity of land on Java:
• Insufficient forage supply (~10% of
farms can provide enough forage for
their herd)
• Insufficient land to apply manure
• Distance between land and cow barn:
• Difficult to utilize wet cattle manure
as fertilizer (handling, transport)
• Much time spend on collecting forage
(>3h per day)
USDA 2019; Zahra et al., 2021; De Vries
and Wouters, 2017; De Vries et al., 2020.

Options for improving sustainability
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Category Intervention
Feeding Improve feed quality:
- Compound concentrate feed
- Minerals and vitamins
- High quality by-products
Improve forage supply and quality:
- Expand land for forage production
- Improve forage management
- Alternative fodder species
- Whole plant maize silage
Improve feeding practices:
- Balancing rations
- Sufficient drinking water
- Increase feeding frequency
Animal health and husbandry Improve animal health
Improve genetic potential
Improve fertility and reproduction
Manure management Utilization in the dairy sector:
- Daily spread
- An. digester maintenance, manage digestate
- Match fertilizer use w plant requirements
Utilization in other sectors:
- Drying cattle feces
- Utilization of cattle urine

Sustainably increasing milk production
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• Increasing domestic milk production via increases in
productivity vs. cattle population
• Potential benefits farmer income and livelihoods, AW
• Interventions with expected high impact on productivity
(e.g. feeding higher quality feed ingredients such as
compound feed, by-products, maize silage; increasing
forage supply, for example by expanding land)
• Large risk of trade-offs:
• GHG (high carbon footprint of cultivation/processing
feeds, land use change, increased N loss)
• Water/air/soil quality, biodiversity (land use, N loss)
• Food-feed competition (use of arable land)

Sustainably increasing milk production
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• To avoid or reduce trade-offs:
• avoid land expansion on arable land or nature
• avoid feeding primary arable crops; instead use high-
quality by-products or crop residues
• avoid forages and feeds with a high carbon footprint
from cultivation or processing
• ensure good feeding practices (e.g. balanced rations)
• recycle manure as a fertilizer
• No-regret options, e.g.:
• balancing rations, providing sufficient drinking water,
improving animal health, improving forage management

Manure recycling
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• Few incentives for dairy farmers: often not or little
profitable and limited enforcement, competition synt. fert.
• Utilization in dairy sector:
• Landbased dairy farming (land consolidation), daily
spread: easiest, cheapest, and lowest-emission solution
• Fertilization practices; risks of overfertilization, storage
emissions
• Utilization outside the dairy sector (e.g. horticulture):
• Requires cost-effective storage, processing and delivery
systems
• Farmer to farmer, and large-scale processors
• Urine
IPCC, 2019; Pronk et al., 2020; Zahra et al.,
2021; De Vries et al., 2020

Recommendations
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• Support research and development of practices to increase
productivity, but avoid trade-offs (GHG, water/air/soil quality,
biodiversity, food-feed competition)
• Support research and development of animal waste management,
provide incentives
• Provide (long-term) education and training to farmers and extension
workers about good on-farm practices
• Provide access to credit, particularly for animal waste management
• Establish monitoring and evaluation
• Key stakeholders: farmers, dairy cooperatives, feed companies,
other ag sectors, governments

Thank you
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Marion.deVries@wur.nl
WindiAlZahra@apps.ipb.ac.id
https://www.wur.nl/nl/project/Sustainable-Intensification-
of-Dairy-Production-Indonesia.htm