Our effort to trace back to plantations has shown that roughly 40% of our supply base is made up of smallholders.
A supply base that is largely made up of smallholders will probably have a high risk of deforestation. Our diagnostic report for the Riau Province has shown that there is a large proportion of smallholder development that took place between 10-30 years ago. For these landscapes, implementing High Conservation Value (HCV) or High Carbon Stock (HCS) assessments will be complicated.
What is worrying is the expansion of independent smallholders without an implementation mechanism that adheres to the principle of No Deforestation. Independent smallholders are not bound contractually to any mills and typically have lower yields than schemed smallholders who would need to sell to a fixed mill. With lower yields, expanding the planted area is the likely strategy to increase incomes.
Moving beyond the No Deforestation polemic, the Musim Mas Extension Services Programme (ESP) is targeted at independent smallholders and hopefully transform the industry from the ground up.
In the course of our engagement with our suppliers, we found out that some wish to include and manage their indirect farmers too, but do not have the necessary tools. Others may not know how to operate a farmer extension model. Some suppliers may not even realize that they can improve the condition of their farms and smallholder farms. We want to have a tested system, and share the knowledge with everyone to manage their smallholder extension, so that everyone has inclusive systems, making it a win-win for everyone.
The Musim Mas ESP aims to provide suppliers’ farms and smallholder farmers with knowledge of Good Agricultural Practices (GAP), and other Best Management Practices and sustainability criteria.
Ultimately, it is about deepening partnership with our suppliers and ensuring their continued access to the global marketplace.
Building upon our experience from our collaboration with IFC, a member of the World Bank, we will scale up our work by moving beyond our mill gates to those of our suppliers’ mills.
As a first step, we started our ESP footprint in South Sumatra. As the programme experiences success and momentum, we will look to other regions that are important to Musim Mas.