Clients visit Indonesian dairy cooperative

Java dairy farmers thrive with support of Rabo Foundation Client Fund

Clients of the local Rabobank Weerterland en Cranendonck in the Dutch province of Limburg are supporting the Andini Luhur dairy cooperative on the Indonesian island of Java through the Client Fund of Rabobank Foundation. They have pooled their funds to make a donation to this project, which is dear to their heart as farmers. In October 2015, several of these clients visited the dairy farmers who are members of this cooperative.

Small cooperative with big dreams

A group of dairy farmers on the island of Java established the Andini Luhur dairy cooperative in 1999, based on the notion that they could achieve more together than alone. The members share in the profit and receive annual dividends, currently amounting to approximately 400,000 rupia (the equivalent of roughly 25 euros). The cooperative wants to prevent its membership – currently at 250 – from growing too quickly, both in an attempt to curb costs and because profits are too low at present to be able to share them with a large group of people.

Milk quality

As milk quality is a key priority for the Andini Luhur cooperative, it performs a quality assurance test upon delivery. If the milk is found to pass muster, the farmers receive a competitive price for their product: a total of 3,000 farmers sell their milk to the cooperative, which processes a total of 30 tonnes a day. Since their facility has a processing capacity of 50 tonnes, there is still ample room for growth.

Collecting the milk

The milk is collected from farmers in the morning and evening by what are known as ‘collectors’, who then deliver the milk to the cooperative. There is a constant movement of cars and mopeds on the Andini Luhur grounds that are there to deliver and collect milk churns. These churns and barrels are cleaned thoroughly after the product is delivered.

Farmer colonies

The average farmer doing business with Andini Luhur has two to four cows, which he keeps in and around the house. The cooperative is currently experimenting with collective farms (also known as ‘colonies’), which keep a maximum of 16 cows owned by different farmers in one central location. The cooperative expects that this expansion of scale will help it to save costs and improve the efficiency of its operations.

Extra revenue from biogas plant

Martono has been a member of the cooperative for 15 years and recently set up his own biogas plant, facilitated by a loan provided by the cooperative. The investment has proved to be a real boon to his business: in addition to producing 20 litres of milk a day, his cows also provide him with manure, which he can use to convert into biogas. This means he no longer needs to source gas from external sellers, which makes a difference of some three cans of LPG a month. He subsequently sells any excess manure to other farmers.

Building towards the future

During a future visit to the Java cooperative, the local Rabobank Weerterland en Cranendonck intends to provide the dairy farmers with further training in areas such as animal nutrition, barn maintenance and medical care. Rabobank Foundation is currently investigating opportunities for installing a cooling tank and providing technical support.