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n a bid to boost demand for dairy products in Indonesia, which is projected to reach 10 million tons annually by 2020, the East Java provincial administration will revitalize dairy farms in a number of dairy production centers in the province.

One of the efforts to revitalize dairy farming is increasing the cattle population through programs, such as offering subsidies to farmers and genetics improvement so as to produce cattle that is resistant to weather changes.

East Java Vice Governor Saifullah Yusuf said the administration would disburse allocated funds amounting to Rp 200 billion (US$23.6 million) from the provincial budget to 100,000 dairy farmers in Tulungagung, Blitar, Malang, Pasuruan, Lamongan and Tuban.

“Currently, a majority of dairy farmers in East Java own only between three and five cows each. Yet, to meet the needs of the milk industry, the ideal number of cows
they should own is 10. The subsidy program is aimed at raising the number of farmers’ cows, Saifullah told The Jakarta Post after a workshop on sustainable dairy development in Indonesia in Surabaya on Monday.

He added that the administration would also conduct a program to create dairy cows that are resistant to weather changes. The administration, which is working together with the Indonesia Safari Park II in Prigen, has already conducted artificial insemination (IB) by cross-breeding the Bali variety of cow (Bos sondaicus) and the Javanese bull (Bos javanicus).

“The cross breeding is expected to later give birth to superior calves that are resistant to every kind
of weather and produce good quality beef. The IB program will resume with a dairy cow variety of superior quality and high productivity,” he said.

Based on Industry Ministry data, national milk consumption stands at 10.47 liters per capita annually, while national milk production amounts to between 1 and 1.5 million liters daily, or only 30 percent of national milk demand. To meet the milk demand, major milk processing companies must import 70 percent of their fresh milk.

Deputy Trade Minister Mahendra Siregar said the country was not able to cut down on imported milk given the huge national milk demand. The national dairy industry experiences annual growth of 25 percent.

“Growth in the dairy industry is evident from the accumulation of gross regional product of 6.5 percent annually, including dairy cow population growth in Indonesia, which increases at an average of 1.6 percent annually,” said Mahendra.

He added that besides low milk production, one of the constraints in the development of the dairy industry was the relatively low productivity of dairy cows and low quality of products, which had not yet met Indonesian National Standards (SNI), particularly in terms of bacteria content in milk.

One of the challenges faced by the dairy industry is maintaining competitiveness in facing free trade and providing products at affordable prices.

PT Nestle Indonesia president director Arsyad Chaudhry said his company would further raise the volume of fresh milk from dairy farmers in East Java, which currently reaches 700,000 liters daily, supplied by 31 cooperatives in meeting the demand of the company’s plant in Kejayan, Pasuruan, East Java.

“We have continued to invest so as to meet the milk demand of the local market. After investing $100 million this year, we will also add another $100 million for our factory in West Java,” he said.

Nestle currently absorbs 700,000 liters of milk each day from its dairy partners in East Java to be processed at its plant in Kejaan, Pasuruan. The factory will later take in 1.5 million liters of milk daily following the additional investment.

National Dairy Council head Teguh Boediyana said the government must form an independent body to determine the price and quality of milk in an effort to improve the welfare of farmers.

“The presence of an independent body to determine the quality and price of milk from local farmers would be fair for farmers. The Indonesian Association of Milk Processors [IPS] would also be unable to arbitrarily set prices,” said Teguh.