Socio-economic analysis of the slaughtering systems in the poultry

Transcription

Socio-economic analysis of the slaughtering
systems in the poultry meat sector
in Greater Jakarta Area
By: Arief Daryanto, Diederik de Boer, Dikky Indrawan, Ferry Leenstra,
Huub Mudde, Idqan Fahmi, Peter van Horne
Study in the framework of the Inception Phase of the Dutch-Indonesian
Program on Food Security: Poultry & Dairy Sector Components
March 2014
Contents
Executive Summary....................................................................................................................................... 3
1. General introduction................................................................................................................................. 6
2. Research methodology ............................................................................................................................. 7
3. Desk research ............................................................................................................................................ 9
4. Research findings on the slaughtering systems ...................................................................................... 14
4.1 Slaughter point and wet market chain ............................................................................................. 14
4.2 Small slaughterhouse chain .............................................................................................................. 16
4.3 Industrial slaughterhouse chain........................................................................................................ 17
4.4. Economic comparison of the three slaughtering systems ............................................................... 19
4.5 Rules and regulations ........................................................................................................................ 21
4.6 Access to finance............................................................................................................................... 24
4.7 Markets (and consumers) ................................................................................................................. 25
4.8 Constraints for upgrading ................................................................................................................. 26
5. Conclusions and recommendations ........................................................................................................ 30
5.1 Conclusions ....................................................................................................................................... 30
5.2 Recommendations ............................................................................................................................ 31
6. References .............................................................................................................................................. 33
Annex 1. Terms of Reference of the study ............................................................................................. 35
Annex 2. List of interviewees .................................................................................................................. 41
Annex 3. Questionnaires socio-economic situation of slaughtering systems ........................................ 43
Annex 4. Map of Greater Jakarta Region with locations of semi-automated and fully automated
slaughtering houses ................................................................................................................................ 49
Annex 5. Relevant governmental regulations......................................................................................... 57
Socio-economic analysis of the slaughtering systems in the poultry meat sector
in Greater Jakarta Area – March 2014
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Executive Summary
Maastricht School of Management (MsM), the Management Program of the Bogor Agricultural
University (IPB-MB), and Wageningen UR Agricultural Economic Research Institute (LEI) and Livestock
Research executed jointly in the period November 2013 – January 2014 a socio-economic analysis of the
three dominant trading and slaughtering systems of the poultry sector in Greater Jakarta Area. This
study was executed as part of the Inception Phase of the Livestock development program on Food
Security, as proposed by a consortium lead by the Animal Sciences Group of Wageningen University and
Research. A quick scan has been executed using desk research, site visits and semi-structured interviews
with chain partners and stakeholders in poultry production chains, company visits and two group
sessions. The study resulted in a qualitative description of the different poultry supply chains in which
three slaughtering systems are part: i) the small-scale slaughter points; ii) the semi-automated
slaughterhouses; and iii) the fully automated slaughterhouses. And it resulted in an overview of
constraints and recommendations for upgrading the poultry slaughtering system towards more food
secure processing.
Slaughter points
In the Jakarta Greater Area, the most important poultry meat chain is through slaughter points. It is
estimated that 80 to 85% of the broilers are slaughtered this way. A typical slaughter point can handle
up to 1000-2000 birds per night with 5 workers.The birds are grown at small-scale farms and through
traders the birds are transported to collecting farms. From collecting farms small numbers of birds are
transported to slaughter points. After slaughter the carcass is directly transported to the traditional
market. The slaughter point is close to the market in order to deliver the carcass fresh (read: warm) to
the consumer. The birds are slaughtered manually, mainly during the evening and night and the
carcasses with feet, head and all organs are sold the same night, next morning at the wet market. In
Jakarta collection of blood and feathers is obligatory. In Bogor only feathers are collected. Waste water
and (in the case of Bogor) blood goes directly into the river. Crates are not cleaned at the slaughter
point. The slaughter point is in general paid after 24-36 hours, mostly immediately after the vendor has
sold the carcasses.
Small slaughterhouses
A small portion of the broilers is slaughtered in small slaughterhouses with a capacity from 5,000 to
25,000 chicken/day. In the Greater Jakarta Area, around 36 of these slaughter houses exist, of which 5
owned by the government. The birds are grown at small to medium scale farms and directly transported
to the slaughterhouse, sometimes owned by a group of farmers. Directly after slaughter the carcasses
are cooled and packed by piece in a plastic bag. In general stunning (water bath) and plucking are
automated, the birds are transported by shackles, but all other work is done manually. Cooling is in
water in large containers. Purchased ice blocks are used to cool the water. Small slaughter houses tend
to focus on out-of-home market, small supermarket, vendors and very limited kiosks at the wet market.
Feet, head and organs (intestines included) are marketed separately. The slaughter houses determine
the quantities to be slaughtered on the price of slaughter ready birds. If they have own farms, these are
treated as a separate business unit with hard bargaining on price of live birds. Most small slaughter
houses harvest blood and feathers separately (gives revenues), but there is no waste water treatment.
The small plants work with Indonesian copies of slaughter equipment. It is questionable if crates are
cleaned.
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Industrial slaughterhouses
A minor part (10 to 15%) of the broilers is slaughtered in industrial slaughterhouses (> 80,000 per day).
The birds are grown at medium scale to large farms and directly transported to the slaughterhouse.
Directly after slaughter the carcasses are cooled and packed. Due to a lack of uniformity in some plants
only stunning and plucking is automated. Degutting, cutting head and feed is often by hand. The large
slaughter plants produce for the main supermarket chains, out-of-home market and also further
processing (nuggets) is an important part of the business. The large plants do have HACCP and ISOcertificates. Not necessarily the quality of the process is better than with plants that have the state
certificate (NKV). The whole chain is cooled with also delivering of a cooled final product to the
customers. The large slaughter plants often have international equipment. It is questionable if crates are
cleaned.
Conclusions and recommendations
The Indonesian poultry industry is on a cross-road. Both hygiene and prices are becoming important
factors in the years to come demanding for up scaling in the sector. The slaughter points have many
constraints for upgrading contrary to the industrial slaughterhouses whereby the semi-automated
slaughterhouses are facing a mixture of constraints.
In order to increase the hygiene level of small slaughter points, the business owners have to invest in
hygiene knowledge, practice and machines. In order to improve the efficiency of their production the
business needs to upscale. Both issues are difficult. No banks are providing loans to facilitate up-scaling.
And in terms of hygiene, the low effort of enforcement of the government in controlling food-safety of
the numerous slaughter points does not contribute to better food-safety. For the semi-automated
slaughterhouses it can be concluded that up scaling interventions seem to be less costly as less
businesses are involved but also because with a bit of additional support these businesses can become
more hygiene conscious and can also develop more efficient production systems. It can be concluded
that there is no difference in total costs for a slaughter point and a small slaughter house; an efficient
and good managed small slaughter house could compete on price with the slaughter points. The larger
industrial slaughterhouses do not need a lot of support as they are often working according to the latest
efficiency and hygiene standards.
Interventions should be focused on three main areas. First, access to finance needs to be improved to
enable up-scaling aspirations. Next infrastructure needs to be upgraded (roads). Finally, the business
and government need to work more together in developing and maintaining the required hygiene levels
and in obtaining economies of scale in the production processes. Tax exemptions might be helpful in this
process of upgrading. Concretely, it is recommended to:
1. Strengthening public-private cooperation at district level
In order to address infrastructural, institutional and business constraints public-private partnerships
should be developed. There is a need for increased cooperation among public and private parties in the
sector. The aim would be to facilitate trust building among the key actors, to come up with scenarios,
and to agree upon pilots that also involve private partners (B2B).
2. Upgrading semi-automated slaughter houses to become small integrators
The smaller slaughter houses are essential for meeting the growing market needs and for creating a
geographical net of slaughterhouses around Jakarta. Currently, they are too small to meet the growing
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demand, the increasing competition (ASEAN) and have too little resources for the needed investments.
Hence, the semi-automated slaughter houses will need to grow and innovate.
3. Slaughter house innovation
Invest in designing new types of slaughter houses that are more cost effective and environmentally
sustainable. Current systems for cooling and cleaning require a lot of water and (purchased) ice, and in
many (smaller) slaughter houses coops and waste water are not cleaned. Intake of good quality water is
another issue to consider and stunning of poultry according to Halal rules.
4. Availability of investment capital
Explore the possibility for large investors and eventually the set-up of a security fund for the poultry
sector. This might be completely public, but a public–private partnership is also feasible. Investments
are required in both the primary production of poultry (housing) and processing (slaughter plants).
5. Support to District and Provincial governments
The district governments have a key role in law enforcement and economic development. The Provincial
governments have an important coordinating role, and can co-fund district-level activities. Specific
attention could be given to support districts to fulfil their pertinent role more adequately, through
training, strategic plan development, monitoring mechanisms, and benchmarking.
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1. General introduction
Maastricht School of Management (MsM), the Management Program of the Bogor Agricultural
University (IPB-MB), and Wageningen UR Agricultural Economic Research Institute (LEI) and Livestock
Research executed jointly in the period November 2013 – January 2014 a socio-economic analysis of the
three dominant trading and slaughtering systems of the poultry sector in West Java.
This study was executed as part of the Inception Phase of the Livestock development program on Food
Security, as proposed by a consortium including the Animal Sciences Group, Centre for Development
Innovation, and the Agricultural Economic Research Institute of Wageningen University and Research
Centre, the Bogor Agricultural University, Maastricht School of Management, and Advance Consulting
BV. This program aims to develop viable models for domestic production and supply of affordable,
nutritious and safe animal-based products in Indonesia. With the development and testing of these
models the program will contribute towards higher income levels of Indonesian smallholders and
improved access to affordable and safe animal protein products among urban consumers. The focus will
be on West Java as main production and sourcing area of dairy and poultry meat products for Jakarta
and other main urban centres (Wageningen University and Research Centre, 2013).
The slaughtering points and -houses play a pivotal role in the poultry sector. Professionalization and/or
restructuring of the chain actors are vital in the process of improving food safety and hygiene standards.
Besides the required technical capacity development, more clarity is needed on the economic and
financial functioning of the slaughterhouses: what are the key incentives and hurdles for change? The
executed socio-economic analysis of the three dominant trading and slaughtering systems provides this
information. The study aims to get more information on opportunities for upgrading of the slaughtering
practices from an economical and food safety point of view.
This document is reporting the findings of this socio-economic study with the purpose to help give
direction to the implementation of the foreseen livestock development program. It entails information
on slaughtering practices, economics, food safety and environmental risks and government policies. It
concludes with suggestions for project interventions.
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2. Research methodology
The study executed was aimed at identifying the drivers and constraints for change towards more food
secure poultry meat processing in West Java. The expected results of the study as formulated in the
research outline (Maastricht School of Management, Bogor Agricultural University, Wageningen
University and Research Centre, 2013) are:
1. Qualitative description of the present situation of different poultry supply chains in which 3
slaughtering systems are part. These systems are: i) the small-scale slaughter points; ii) the semiautomated slaughterhouses; and iii) the fully automated slaughterhouses. This gives insight in:
2. Overview of drivers and constraints for upgrading the poultry slaughtering system towards more food
secure processing.
For the Terms of Reference of the study including a detailed work plan, see annex 1.
In December 2013 and January 2014, a quick scan has been executed using desk research, site visits and
semi-structured interviews with key chain partners and stakeholders in poultry production chains,
company visits and two group sessions. See annex 2 for the full list of interviewees and site visits and
annex 3 for the questionnaires.
Table 2.1 Categorization and number of people interviewed, group sessions, and site visits
Groups sessions
In depth Interviews
Site visits
4 persons from integrators /
4 representatives of the
1 company integrator / Industrial
industrial slaughterhouse chain banking sector
slaughterhouse
2 persons from small slaughter 2 government officials
2 small slaughter houses
houses
1 representative of a farmer
2 representatives of farmer
1 collecting farm
association
associations
2 academia
1 farmer
1 slaughter point / wet market
1 specialty store
Although initially it was the intention to focus the study on Jakarta only, it was decided to broaden this
to the Greater Jakarta Area with a focus on the Bogor District. Greater Jakarta also includes Bogor,
Depok, Tangerang and Bekasi and is also referred to Jabodetabek. The rationale for this decision was
twofold:
1. The fully automated slaughterhouses are located outside Jakarta, as well as most of the semiautomated slaughterhouses. See annex 4 for a map of the Greater Jakarta Area on which these semi-and
fully automated slaughterhouses are indicated.
2. Government regulations and practice differ per province which may impact on possible interventions.
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The findings and draft report have been validated by senior experts:
Dr Hartono, Chair of PINSAR (Poultry Farmer Association)
Mr Don P. Utoyo, Chair of FMPI (Federation of the Indonesian Poultry Society).
The study has been implemented and coordinated through the Bogor-based IPB-Centre for Sustainable
Business Competitiveness (CSBC), a joint-venture of IPB and MsM1.
1
CSBC is about bringing different (international) partners together to work towards concrete sustainable economic
development in the Indonesian agricultural sector from a business perspective, based on cluster and value chain
approaches.
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3. Desk research
Poultry sector in Indonesia
The poultry sector in Indonesia is a growing business fully geared towards the domestic market. The
increase of personal income leads directly to higher meat consumption. In Indonesia that is mainly
chicken meat given the predominant Muslim population and the high prices for beef: 87% of Indonesia’s
fresh meat consumption is chicken (OSK, 2012). Other sources estimate this at around 54% (PT Japfa
Comfeed Indonesia Tbk, 2013). Given the low chicken meat consumption of around 6 kg per capita,
lower compared to other countries in South East Asia, there are huge growth potentials (OSK, 2012)
(Daryanto, 2011) (Indonesian Commercial Newsletter, 2011) (Pefindo, 2009). Between 2011 and 2015
the poultry meat production is estimated to grow from 600,000 tonnes towards 1,600,000 tonnes
(Rabobank, 2011). More recent information from the Federation of the Indonesian Poultry Society FMPI
(personal interview, 2014) indicate that the total chicken meat production has already grown to 2 mln
tonnes, equals around 8 kg per capita. This figure is based on the number of day-old-chicks (DOC) sold.
The poultry supply industry upstream of broiler growers in Indonesia is characterized by its oligopolistic
nature with a few large players that control the market of day-old-chicks and feed. The two largest
companies are Charoen Pokphand Indonesia and Japfa Comfeed, estimated to command more than half
of the feed and breeding industry (OSK, 2012) (Rabobank, 2011). Both companies are integrators (upand down-stream) involved in most levels of the value chain, from feed production, hatching day old
chicks, slaughter and further processing. Broiler farmers are involved through contract farming with
these integrators (Rabobank, 2011). The same integrators dominate the market for DOCs and feed
supplied to the independent small and medium scale farms. Given the fact that feed and DOC account
for around 70% of the broiler costs (Embassy of the Kingdom of the Netherlands, 2013), this illustrates
the powerful position of the big integrators. According to the Indonesian feed mill association GPMT,
the capacity of the 68 biggest feed companies in Indonesia reaches to 18.5 million ton per year (Agrina,
2013).
Broiler grandparent stock comes from the standard international breeding companies. Cobb and
Aviagen (Ross broilers) share the market, as they do worldwide. The feed mills have to buy feed
ingredients and the (grand)parent stock on the world market. According to Faiz Ahmad (Director of the
Food Industry, Sea Product and Fisheries of the Ministry of Industry), the self-sufficiency in feed
ingredients for poultry in Indonesia is about 20% (Indonesia Finance Today, 2013).
Table 3.1 Indonesia animal feed and DOC production: capacity share of largest companies
Animal feed
DOC production
Charoen Pokphand Indonesia
33%
31%
Japfa Comfeed
21%
21%
Cheil Jedang Feed Indonesia
8%
1%
Malindo Feedmill
6%
8%
Sierad Produce Tbk
5%
6%
Wonokoyo
4%
5%
Source: Rabobank International FAR research and industry sources (April 2013)
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The large integrators are less dominant in the slaughtering process as 85% of all chicken is slaughtered in
slaughter points. From the six DOC and feed suppliers listed in table 3.1, only Charoen Pokphand
Indonesia, Japfa Comfeed and Sierad Produce have slaughter plants; Charoen Pokphand is the biggest
and Sierad Produce the smallest. The large slaughter houses and the medium-sized, semi-automated
slaughter houses together cater for around 15% of all chickens slaughtered.
In their study on local power relations in relation to animal health policies, Charnoz and Forster (Charnoz
& Forster, 2011) analyse the poultry sector in Indonesia as “frozen in a stage of ‘half modernization’”.
Daryanto refers to the dualistic sector, both modern and traditional (Daryanto, 2011). At one hand large
modern companies enhance the scale of poultry farming, working with numerous small holders some
times in a contract farming system, but also as independent source of slaughter ready broilers. This socalled nucleus – plasma model is common in many Indonesian agricultural industries, initiated by the
Indonesian Ministry of Agriculture in 1978 to expand perennial crop production. It provided large
companies with subsidized loans and long-term land lease contracts under the condition of providing
inputs, credit, and services to smallholders (OECD, 2012). The sector is further characterized by too few
and mostly pre-industrial slaughter houses, inappropriate transport systems, and live markets (Charnoz
& Forster, 2011).
Table 3.2 presents the key figures above indicating the size of the sector with more than one million
chicken slaughtered daily in the (semi) automated houses. It is an estimate on national, Indonesian level.
Table 3.2 Chicken meat consumption and slaughter capacities in Indonesia, rough estimates
Estimated total chicken meat production in Indonesia (kg)
(FMPI, 2014) 2,000,000,000
Consumption per person in Indoensia (250 mln inhabitants) 8.00
15% of chicken slaughtered by (semi) automated houses
(kg) 300,000,000
number of chicken slaughtered/year (slaughtered weight =
70% of live bird) 333,333,333
number of chicken slaughtered per day by (semi)
automated houses, effective 300 days/year 1,111,111
capacity 1 big slaughter house/day
capacity semi-automated slaughter house/day
at least 80,000
5 - 25,000
kg/year
kg/capita
kg/year
chicken/year
chicken/day
chicken/day
chicken/day
Poultry sector in Greater Jakarta Area
The largest concentration of broiler farms in Indonesia is in the Greater Jakarta Area because of the
largest consumer market, with sales averaged more than 1,125,000 chickens daily (2009) (Indonesian
Commercial Newsletter, 2011). Table 3.3 presents an overview of the growth in annual chicken sales per
year.
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Table 3.3 Chicken sales in Greater Jakarta Area, number of chickens slaughtered per year
2005
2009
2010
Jakarta
96,265,000
171,574,000
200,742,000 *)
Bogor
40,880,000
76,650,000
Tangerang
40,150,000
74,095,000
Bekasi
60,650,000
Depok
27,740,000
Total
410,709,000
Source: Indonesian Commercial Newsletter, August 2011
*) estimation
Poultry chain characteristics
The poultry chain can be characterized by using the types of governance value chains as identified by
Gereffi et al. (Gereffi, Humphrey, & Sturgeon, 2005):
1.
2.
3.
4.
5.
Market value chains whereby the costs of switching to new partners is low
Modular value chains, whereby products are made by a customer specification
Relational value chains with complex relations between buyers and sellers
Captive value chains in which network suppliers are dependent on large buyers
Hierarchical value chains; this is a vertical integrated chain.
The characteristics of these types of value chains are based on three factors:
A. The complexity of information and knowledge transfer that is required to sustain a particular
transaction, particularly with respect to product and process specifications;
B. The extent to which this information and knowledge can be codified and, therefore, transmitted
efficiently and without transaction-specific investment between the parties to the transaction; and
C. The capabilities of actual and potential suppliers in relation to the requirements of the transaction.
The poultry sector in Indonesia is a market driven chain whereby the complexity of the transactions is
low and the ability to codify transactions and the capabilities in the supply chain are high. It is
interesting to note that if regulations would be enforced more, the complexity of the information and
knowledge required will increase and the chain will be become a modular value chain. In these types of
chains there are often less actors involved as the transactions become more complex. These chains are
also easier to regulate.
Pefindo (2009) identifies four key success factors for the poultry industry from a business perspective:
• Market position and scale of production are important for increasing competitiveness: economies of
scale are essential
• Vertical integration is beneficial for reducing risks of oversupply and enables for lower production
costs
• Diversification in terms of suppliers, locations, markets, and customers are essential to prevent
concentration and stabilize the revenue and profitability. Given the importance of proximity with
the final consumer, and minimizing freight costs, this asks for regionalization
• Operating management to be improved for controlling costs and expenditures.
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Slaughtering
In the report on poultry value chains in the Jakarta region (Sudarman, et al., 2008) it was concluded that
the traditional market retailers see little threat from processed chicken due to their lower price and
because their chicken is perceived to be ‘fresher’ than product ex modern slaughterhouses. The latter is
countered in the findings of the 2014 consumer survey executed in parallel to this study, stating that the
perception for wet markets and modern markets are indifferent for performance on safety and selling
safe poultry meat (Tacken, Immink, Indrawan, Snoek, & Sumarwan, 2014 (forthcoming)). In the same
report, Sudarman et all conclude that slaughter points in traditional markets play a dual role of
butchering and retailing poultry products. The slaughter points keep live poultry, slaughter it directly in
the market, and dispose the waste abruptly with poor application of sanitary procedures. The slaughter
points are a high risk for Avian Influenza transmission (Sudarman, et al., 2008).
Governmental context
The government encourages self-sufficiency in meeting the country’s poultry needs. This limits the
threat of import (OSK, 2012), but likewise limits the incentives for change. When working in Indonesia
the relation between the government and the larger society needs to be understood. This is well
explained by Paul Forster in the context of the Avian Influenza (Forster, 2009). He explains the little trust
in government because of Indonesia being a young democracy emerging from decades of autocratic
rule, the tendency to compromise, hence little is changing, and the robust reality on the ground.
The poultry sector in Asia
The chicken meat production in Indonesia is less cost-effective than in surrounding countries, like
Malaysia and Thailand. Indonesia needs to address hygiene levels in the poultry sector and need to
produce more efficient in order to keep up with competition from abroad. Currently, the Indonesian
poultry industry cannot compete on price and quality with imported products. By January 2016, the
ASEAN economic integration will start to materialize, although conditions are still being negotiated. It is
highly unlikely that import restrictions on agricultural products will disappear easily, but the principle
remains that the sector is vulnerable for international competition. In addition, it should be stated that
the majority of the poultry sector in Indonesia is currently traditional, selling non-frozen chicken. Thus,
in case of an increase of (frozen) imported chicken meat, it will affect mainly the industrial cold chain in
Indonesia.
Food safety
Given the importance of poultry meat consumption for Indonesia and the expected growth in meat
consumption within the next couple of years, food safety and animal health issues are of extreme
importance. Environmental, food safety and veterinary health risks are present in the small slaughter
points and wet market chain which is by far the biggest chain as explained above. According to several
studies (Embassy of the Kingdom of the Netherlands, 2013), 80% of the chicken collector yards were
contaminated with live H5N1 HPAI. This poses both human and veterinary health risks. Avian influenza
and other infectious diseases are a continuing risk, especially due to close contact between humans and
poultry (collector farms, slaughter points). During production, the routine treatment with three different
antibiotics for 3 days each week during the first 3 weeks of a broiler live (slaughter at 4-5 weeks of age),
Is a potential risk for the development of antibiotic resistance. Microbiological quality of poultry
products is probably not a huge problem, due to cooking habits and food knowledge of the Indonesian
population, with exception of bacteria resistant to antibiotics.
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Concluding, we can state that the Indonesian chicken industry as it stands now is on a cross-road. Both
hygiene and prices are becoming important factors in the years to come. The ASEAN economic
integration will force Indonesia to eventually open up its poultry market. Neighbouring countries like
Thailand and the Philippines can produce chickens cheaper and an influx of cheap frozen import
chickens from abroad is eminent. At the same time the pressure for a more hygienic poultry chain from
the government, ASEAN and consumer groups and donors becomes an important force demanding for
change. Both hygiene and price will demand for up scaling in the sector whereby up scaling of the semislaughter houses seems to be most realistic as they are already in the process of becoming more
hygienic and becoming also more industrialized.
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4. Research findings on the slaughtering systems
Three types of production chain can be distinguished in the Greater Jakarta region, characterized by the
slaughtering and marketing system:
•
•
•
Slaughter points and wet market chain
Semi-automated slaughter houses
Industrial slaughter plants, part of integrated poultry production
The slaughter points and the semi-automated slaughter houses are part of a complicated network of
several chain actors. In this chapter the three chains are described in more detail after which a
comparison is given on the cost flow in each chain. Further, information is presented on the role of the
government in regulating the sector, and credit facilities offered by banks. Last, an overview is given on
possible drivers and constraints for upgrading of the slaughtering sector in Greater Jakarta region.
4.1 Slaughter point and wet market chain
In the Jakarta Greater Area, the most important poultry meat chain is through slaughter points. It is
estimated that 80 to 85% of the broilers are slaughtered this way. The birds are grown at small-scale
farms and through traders the birds are transported to collecting farms. From collecting farms small
numbers of birds are transported to slaughter points. After slaughter the carcass is directly transported
to the traditional market. The slaughter point is close to the market in order to deliver the carcass fresh
(read: warm) to the consumer. Figure 4.1 gives the overview of the chain.
Figure 4.1 Overview of slaughter point and wet market chain
FARMERS
TRADERS
COLLECTING FARM
SLAUGHTER POINT
RETAILER: traditional market
CONSUMERS
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Deviations to this chain occur, often increasing the complexity. In many cases, more than one trader is
involved (hence a trader selling to another trader), and also traders may operate between the collecting
farm and the slaughter point: this trader could be the same person as the slaughter, but not per se. In
case of immediate need for cash, a farmer may transport chicken directly to a collector farm (hence
shortening the chain).
Poultry farmers
There are no poultry farmers in DKI Jakarta Province; most of the supply comes from poultry farms
located outside DKI Jakarta of which the majority is located in West Java, Banten, and South Sumatra
Provinces. Poultry farmers can be independent, contracted by a slaughter plant, or owned by an
integrator. Some interviewee state that the independent farmers seem to disappear. They tend to
organize themselves in groups for negotiations on day old chicks (DOC’s), feed and medication.
Independent small farmers tend to come into financial problems, due to the volatile prices of slaughter
ready chickens. A farmer with slaughter ready chickens has to sell and cannot wait for better prices. He
needs cash to buy DOC’s and feed for the next round. Farmers that cannot manage to finance the next
round of broiler production are either incorporated into a group (taken over by another farmer) or the
location is taken over by an integrator.
In general, traditional broiler farms (bamboo, slatted floors, and natural ventilation) have one or more
houses with a maximum of about 2000 birds/house.
Traders or brokers
When (independent) poultry farmers have a slaughter ready flock, they need immediate payment to be
able to invest in a next round of DOC’s, feed and medication. This is where brokers or traders come in.
They do not physically interfere with the birds, but function more or less as a banking system. They
provide the farmer with cash payment, and receive the payments from the slaughter point or slaughter
house about two to four weeks later. One interviewee states that the average interest for this cash flow
system is 3.5-4% per month. Most brokers work with a limited number of farmers (6-10). More is not
possible because of the amount of money and the risk involved.
Collector farm
From the farm the birds can either go directly to a slaughter point or slaughter house or to a collector
farm in DKI Jakarta Province. The latter comes in for delivering live chickens to smaller slaughter points.
At the collector farms the birds are housed in floor pens and from these pens they are sold the same or
the other day in quantities of 30-60 (60 is the maximum number that can be transported on a motor
cycle). In general the birds at the collector farm can come from small to medium scale farms. A collector
farm handles mostly broilers. However on the collector farm we visited we also saw broiler parent stock
and spend layers. The collector farm often has slaughter facilities, but in general the birds are
slaughtered at other locations.
A typical collector farm can handle 20 – 30.000 birds a day. The birds arrive with small trucks, the
majority leaves in bundles on a motorcycle. A trial by FAO to clean and disinfect trucks was abandoned,
as the drivers were not willing to wait for cleaning. What we did see is that crates are not cleaned at the
collector farm and very likely not at all before re-use.
Slaughter point
A slaughter point is a facility where broilers are slaughtered for the traditional market (wet market). The
slaughter points often appear in groups, at the board of the river and close to market places. The birds
are slaughtered manually, mainly during the evening and night and the carcasses with feet, head and all
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organs are sold the same night, next morning at the wet market. A typical slaughter point can handle up
to 1000-2000 birds per night with 5 workers. The slaughter point we did see was at the base floor of the
house of the owner. The workers are often family members or neighbors. In a neighborhood with a
number of slaughter points almost all inhabitants are connected to the slaughter points and
consequently there is no complaining on the presence of the slaughter points in a residential area.
In Jakarta collection of blood and feathers is obligatory. In Bogor only feathers are collected. Waste
water and (in the case of Bogor) blood goes directly into the river. The slaughter point is in general paid
after 24-36 hours, mostly immediately after the vendor has sold the carcasses.
Crates are not cleaned at the slaughter point.
4.2 Small slaughterhouse chain
A small portion of the broilers is slaughtered in small slaughterhouses. In the Greater Jakarta Area,
around 36 of these slaughter houses exist, of which 5 owned by the government. The birds are grown at
small to medium scale farms and directly transported to the slaughterhouse, sometimes owned by a
group of farmers. According to statistics of the government of West Java, up to 11% of chicken may die
in transport due to the heat, long distance between the farm and the slaughter house, and traffic jams.
Directly after slaughter the carcasses are cooled and packed by piece in a plastic bag. Figure 4.2 gives
the overview of the chain.
Figure 4.2 Overview of small slaughterhouse chain
FARMERS
SMALL SLAUGHTER HOUSE
RETAILER: small supermarket, out of
home, vendor
CONSUMERS
Small slaughter house
The capacity of small slaughter houses is from 5,000 to 25,000 chicken/day. In general stunning (water
bath) and plucking are automated, the birds are transported by shackles, but all other work is done
manually. Due to large variation within flocks the use of automated degutting gives too many losses.
Cooling is in water in large containers. Purchased ice blocks (from ices factories and transported by
truck) are used to cool the water. Small slaughter houses tend to focus on out-of-home market, small
Page 16 of 66
supermarket, vendors and very limited kiosks at the wet market. Both small slaughterhouses we did visit
did also cut up birds and marinated whole birds or parts according to client specification. Feet, head and
organs (intestines included) are marketed separately.
The small slaughter houses we did visit did try to combine the slaughter with cold store. In that case
fluctuations in price of live birds can be balanced. When the birds are cheap the store is filled, when
they are expensive the cooling system is used reversed to thaw carcasses from the cold store to sell as
fresh.
Further processing and cold store is the live line for slaughter houses, because margins in slaughtering
are too low to become profitable. They do not work according to capacity, but determine the quantities
to be slaughtered on the price of slaughter ready birds. If they have own farms, these are treated as a
separate business unit with hard bargaining on price of live birds. This was the case for the two small
slaughterhouses we did visit were both owners were also involved in broiler farming. To our impression
most small slaughter houses harvest blood and feathers separately (gives revenues), but there is no
waste water treatment. Transport of the final produce can be with cooled transport which can be
owned by the slaughter plant. The small plants work with Indonesian copies of slaughter equipment.
It is questionable if crates are cleaned.
4.3 Industrial slaughterhouse chain
A minor part (10 to 15%) of the broilers is slaughtered in industrial slaughterhouses. The birds are grown
at medium scale to large farms and directly transported to the slaughterhouse. Directly after slaughter
the carcasses are cooled and packed. Figure 4.3 gives the overview of the chain.
Figure 4.3 Overview of industrial slaughterhouse chain
FARMERS
SLAUGHTER HOUSE
RETAILER: large supermarket, fast
food restaurants
CONSUMERS
Page 17 of 66
Poultry farmers
The large integrators normally work with bigger farms (e.g. for CP more than 5,000 birds). The farms can
be either contracted (nucleus – plasma model) or completely owned by the integrator. Production on
contract means that the farmer gets the DOC’s and feed from the integrator and delivers the slaughter
ready to the same integrator. The integrator owns the birds and the farmer is paid a compensation for
doing the work and supplying the poultry house. Some interviewee state that the number of contract
farmers appears to diminish. Dependent on the market price and the demand from the integrator,
farmers also supply to the other two slaughtering chains.
Due to volatility in prices of slaughter ready birds the willingness of slaughter plants to have long term
appointments is reduced. Especially the integrators tend to work more and more with farms with
climate controlled housing. With this modern system the performance is better and also the uniformity
(in final weight) of the birds is improved (which is important for automated slaughter). Farms with
closed houses have in general two stories, closed floors and mechanical ventilation. The standard farm
with closed housing has 25,000 birds.
The integrations and larger farmers are in general able to finance this cash flow themselves, so traders
and brokers are not part of the production chain.
Industrial slaughter houses
The number of industrial slaughter houses (> 80,000 per day) is small. Only the large integrators have
such facilities. According to several sources, these slaughter plants do frequently not use their full
capacity as a mechanism to influence prices for live chicken.
Due to a lack of uniformity in some plants only stunning and plucking is automated. Degutting, cutting
head and feed is often by hand. The large slaughter plants produce for the main supermarket chains,
out-of-home market and also further processing (nuggets) is an important part of the business. The
large plants do have HACCP and ISO-certificates. Not necessarily the quality of the process is better than
with plants that have the state certificate (NKV). The whole chain is cooled with also delivering of a
cooled final product to the customers. The large slaughter plants often have international equipment. It
is questionable if crates are cleaned. The large processor we did visit had water cleaning facilities for
cleaning the incoming water and the waste water.
Page 18 of 66
4.4. Economic comparison of the three slaughtering systems
Based on the information collected during our visits (interviews, visits, and group sessions) we did
compare the cost of the three production chains: slaughter point, small slaughterhouse and large
slaughterhouse. This is an indicative model to illustrate the differences in costs at the different links in
the production chain and presenting an average. However in every stage there is a wide variation
between companies. Table 4.4 gives the results.
Table 4.4 Economic comparison of three slaughtering systems in Greater Jakarta region (prices in Rps)
slaughter Point
1000-2000 birds/day
Small Slaughter House
5000-15000 birds/day
Large slaughter house
over 50000 birds/day
assumptions
unit *
Live weight at farm (kg)
1.3
1.3
1.3
yield carcass (%) **
0.75
0.75
0.68
carcass weight (kg)
0.975
0.975
0.884
live birds, costs per kg live weight:
Price/kg Live weight
LW
15000
15000
15000
transport from farm
LW
500
500
500
Collecting Farm fee
LW
600
0
0
transport to slaughter place
LW
300
0
0
A: total cost at gate slaugher house
LW
16400
15500
15500
carcass, costs per kg carcass weight:
costs carcass weight
CW
21867
20667
22794
Slaughter costs ***
CW
1500
2000
2500
Revenues organs, int ****
CW
1200
1100
1000
B: Net Slaughter costs
CW
300
900
1500
Profit/finance/risk
CW
0
500
1000
packing
CW
0
200
400
C: total cost leaving sl.house
22167
22267
25694
Transport to market
CW
200
500
800
market fee (estimate)
1800
2500
5000
D: total calculated costs at consumer level CW
24167
25267
31494
*_LW is live weight; CW is carcass weight
**_the yield in large slaughterhouses is lower because the final product is different (carcass without head and feet).
***_ Differences between companies. Large slaughterhouses have e.g higher costs for labour and waste/water treatment.
****_revenues are higher for slaughter points/houses close to the wet markets
The comparison is based on slaughter points in which 1,000 to 2,000 birds per day are slaughtered. For a
small slaughter house the scale is 5,000 to 25,000 birds per day. The large slaughter houses slaughter
more than 50,000 birds a day. For all systems the calculations are based on the slaughter of 1.3 kg
broiler. This is the average weight of broilers for the whole birds market in Jakarta. Large slaughter
houses also slaughter broilers at higher live weight. However, these birds are used for cut-up and further
processing (e.g nugget etc). In the comparison we strictly focus on the market of whole birds in either
the wet market (slaughter points), mini market/kiosk/vendors (small slaughter houses) or super/hypermarket (large slaughter houses).
The slaughter points and small slaughter houses deliver a carcass with head and feet to their customers.
The large slaughterhouses deliver, in general, a carcass without head and feet. Because of this difference
the assumption for carcass yield for the large slaughterhouses is lower.
Page 19 of 66
The total costs at the gate of the slaughter place are higher in the first production chain. See line A in
table 4.4. This is a result of a longer production chain. Birds are transported from the farm to a collecting
farm and later (in small numbers) transported to the slaughter point. The additional costs for the
slaughter points are estimated to be 900 Rps per kg live weight. The interviewees mention costs in a
range from 500 to 1,500 Rps.
The net slaughter costs per kg carcass weight (cw) for the three chains are respectively 300, 900 and
1,500 Rps per kg CW. See line B in table 4.4. The net slaughter costs are the difference of the slaughter
costs and the revenues of organs and intestines. The costs for small and large slaughter houses are
higher due to higher costs for building, equipment and labor wages. Large slaughter houses also have
additional costs for waste- and water treatment. At the same time slaughter points have higher
revenues for organs and intestines. With a close and direct connection to the wet market slaughter
points get a higher price for intestines. Although most interviewees agree on this it was difficult to
estimate the difference in price. Another interviewee stated there is no difference in revenue between
the three slaughter systems.
The next step is to calculate the total costs leaving the slaughterhouse. See line C in table 4.4. Compared
to the slaughter points the small and large slaughter houses have additional cost for finance/risk,
meeting national qualifications standards, and for packaging. At the gate leaving the slaughter house the
additional cost for a small slaughterhouse is 100 Rps per kg and 3,537 Rps per kg carcass weight for the
large slaughterhouse. It can be concluded that there is no difference in total costs for a slaughter point
and a small slaughter house. Taking into account the large number of assumptions and the variation in
estimates by the interviewees we can state that an efficient and good managed small slaughter house
could compete on price with the slaughter points. This is confirmed by an interviewee who stated that
the breakeven point for a small slaughter house is at 4,000 birds per day.
In the last part of table 4.4 (see line D) we estimated the total cost at consumer level. Based on the costs
at the slaughter house, the costs of transport to the market and a market fee are added. It should be
noted that in this comparison the three slaughter systems have different markets. The slaughter points
deliver the carcass to the traditional/wet market. The small slaughter houses deliver the carcass to mini
market/kiosk/vendor and the large slaughterhouses deliver the carcass (without head and feet) through
a cold chain to super- and hypermarkets. The price at the wet market is the lowest because the
slaughter points are close to the wet market (low transport costs) and the market fee is low. The
consumer price is the highest in super-/hypermarket because of higher costs at the slaughter house,
transport in a cold chain and a higher market fee.
This comparison of the costs and the conclusion that the consumer price at the wet market is the
lowest, is the more relevant because the consumer research that has been executed in parallel to this
study, concluded clearly that price (together with health) is the most important food choice motive for
poultry meat (Tacken, Immink, Indrawan, Snoek, & Sumarwan, 2014 (forthcoming)).
Asymmetric price transmissions
It is important to understand that the calculation of the production costs as presented in table 4.4
cannot be copied directly to the day-to-day pricing in the market. There is an asymmetric relation
between the off-farm price and the market/retail price in the large slaughter house chain (asymmetric
price transmission). Positive or negative changes in the off-farm price for live chicken are not directly
Page 20 of 66
leading to price changes for the consumers. This may lead to huge price differences in the same day in
the different chains.
4.5 Rules and regulations
The regulatory environment is complex because of the three governmental levels that impact on the
poultry meat chains. As a consequence of the dekonsentrasi powers are divided between the national,
provincial and district government (as laid down in Government Regulation No. 38 – 2007). With
different political parties that may be in power at different level, coordination and consistency are the
more difficult.
The most relevant national laws and provincial and local regulations in Greater Jakarta Area are listed in
table 4.5. A brief summary of each of these is presented in Annex 5 of this report.
Table 4.5 Overview of relevant laws and regulations
No. Type of regulation
Regulation number / subject
1 Law of the Republic of Indonesia
No. 7 of 1996 on Food
No. 18 Year 2009 on Animal Husbandry and Animal Health
4 Regulation of the Minister of
Number 381/Kpts/OT.140/10/2005 on Guidelines for
Agriculture
Certification of Veterinary Control Business Unit Food of
Animal Origin
5 West Java Provincial Regulation
Number 18 of 2008 on Fees Animal Disease Testing Services,
Materials of Animal Origin and Quality Feed / Raw Feed
6 West Java Provincial Regulation
No. 22 of 2012 on the Implementation of Animal Husbandry
and Animal Health
7 Local Regulation Bekasi
No. 9 of 2012 on Retribution
8 Bekasi District Regulation
Number 6 of 2007 on Fees Animal Husbandry, Fisheries and
Marine
9 Bogor Regency Regulation
No. 29 of 2011 on Business Services Levy
10 Local Regulation Bogor
Number 5 of 2012 on Business Services Levy
11 Local Regulation Bogor
No. 3 of 2009 on Levy Investigation and slaughtering
12 Local Regulation Depok
Number 22 of 2003 on fisheries permits, ranches and
slaughterhouses
13 Local Regulation Depok
No. 7 of 2011 on Levy Slaughterhouse
14 Jakarta Provincial Regulation
15 Jakarta Governor Regulation
16 Jakarta Governor Regulation
17 Tangerang District Regulation
No. 4 of 2007 on Control Maintenance and Poultry Peradaran
No. 146 of 2007 on Guidelines for the Implementation of
Regional Regulation no. 4 of 2007
No. 147 of 2007 on the Provincial Committee for Avian
Influenza Control and pandemic preparedness
Number 7 of 2009 concerning maintenance and Poultry
Disease Control Flu (Avian Influenza)
Page 21 of 66
The national framework for quality assurance and control is that all slaughtering houses have to hold a
NKV certificate (Nomor Kontrol Veteriner). The NKV is formulated by the Ministry of Agriculture. In
addition, Halal certification is required, formulated and issued by the national religious leaders (MUI:
Majelis Ulama Indonesia) in cooperation with the Ministry of Religious Affairs. The Halal slaughtering
process is described in the Ministerial Guidelines on chicken slaughtering (Ministry of Agriculture,
Indonesia, 2006):
•
•
•
•
The animal needs to be alive, healthy and clean; stress prior to slaughtering should be avoided. The
head of the animal needs to face Mekka
The butcher has to be a Moslem, adult and has a sound mind, and has to say the correct Koran
phrases before slaughtering (‘basmallah’)
The throat and main veins of the chicken needs to be cut with one incision by a sharp and clean
knife, after which blood need to flow freely; conducting subsequent process only after bleeding has
stopped
Proper and hygienic slaughtering needs to be conducted and environment’s sanitation to be
maintained.
In its operations with the poultry sector, the government is referring to these formal requirements as
ASUH (Aman, Sehat, Utuh, Halal) which stands for Safety, Healthy, Intact, and Halal. In the Province of
West Java with its predominant Moslim population, the acronym HAUS is used instead given the highest
priority to Halal. Small slaughter points – which constitute the largest part of the slaughtering capacity have nor NKV nor Halal certification and are not subject to NKV inspection; the slaughter houses do.
The Provincial government (in this case the provinces of Jakarta, Java Barat, and Banten) has the
responsibility to develop and implement annual livestock development plans, to monitor over- and
undersupply and trying to stabilize prices, to coordinate the districts, to act as facilitator among key
stakeholders in the province, to act upon disease outbreaks, to inspect cross-provincial transport/trade,
and to execute quality controls. Instruments are:
•
•
•
•
•
•
•
•
Monthly meetings with all the districts representatives
Financial support to district government initiatives2
Regular meetings with poultry sector stakeholders
Assessing NKV applications and issuing the certificates
An animal husbandry website on which the daily prices are published. The Government of West Java
website is http://disnak.jabarprov.go.id
A – mobile – lab and veterinary officers that sometime go in the field, accompanying district officers
for on-situ animal health quality control
A 9-step action plan against Avian Influenza
Provincial border control.
A 9-steps procedure is in place in case there will be an Avian Influenza outbreak. This procedure (set-up
after the 2003 outbreak) is the responsibility of the provincial government. Environmental regulations
are part of the NKV / ASUH, and inspections fall under the responsibility of the districts. The province
2
An example is the Pasar Hewan Higenis initiative (Hygienic Animal Market), piloted in Bogor and Sukabumi in
2009/2010. This Indonesian government project was focusing on ayam kampung in the framework of the AI
National Prevention Program.
Page 22 of 66
gives no specific attention to this. According to the informant of the Province of West Java, NKV / ASUH
is in order for all the registered slaughter houses. Otherwise they are not allowed to operate. Inspection
however is not their authority.
In Jakarta the regulation states that it is not allowed to have live chicken in town. This implies that if
enforced, the small-scale slaughter points need to disappear. In this study, the research team assumes
that this regulation will not change after the upcoming Presidential elections.
After the Avian Influenza outbreak in 2003, the government started to build slaughter houses just
outside residential areas in designated places (Jakarta and direct surrounding provinces). These houses
are rented by private parties. The government policy is to slowly withdraw from this business, to be
taken over by private companies.
The actual enforcement of the law is the responsibility of the districts. However, the districts lack
capacity (or commitment?) to actually implement this. Staff works at regular office hours, whilst the
moving around with live chicken, the slaughtering, and selling takes place in the middle of the night. So
far, government officials only seem to move when there is an outbreak of a disease (AI).
For the Bogor district it is the policy to get good quality Halal chickens, to create in each sub-district one
slaughter house (in the Bogor district alone there are already 40 sub-districts), and to ensure that each
traditional market has a semi-automated slaughterhouse. This plan has yet to be realized.
The district regulations are:
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
The location of a slaughterhouse should be suitable for industry not housing
A site-plan needs to be submitted (40% building-60% open air)
Building permit needs to be in order
Water treatment permit needs to be in order
Waste treatment permit needs to be in order
70% of the work force should be local workers
Preferably a well should be available
The slaughterhouse needs to have a valid NKV (audit every 5 years)
A contract with a veterinarian for regular inspection should be in place
The financial administration needs to be in order: each year a financial self-assessment has to take
place and sent to the tax office
Halal certification needs to be in order
If sales takes place outside of the district, then a “Animal health product safety certificate” is needed
Animal welfare certificate is needed
In case the slaughter house is government property, a retribution fee of 50 Rps per chicken needs to
be paid (also the amount of 100 Rps is mentioned in a regulation, see annex 5)
There is a corporate tax of 30% over profit.
In addition, before being able to obtain a business permit, one needs to have an AMDAL certificate
(Indonesian Environmental Feasibility Assessment). These certificates are issued by district authorities,
but according to informants this is not a transparent and fair process.
Page 23 of 66
The implementation and enforcement of all the regulations, whether by the provincial government or
district authorities, is often cumbersome and in most cases non-existent. Regulations are mainly
focusing on issuing new permits and handling emergencies. There is no policy let alone implementation
to deal with existing unwanted practices like slaughtering points and a vision on transition policies.
Concluding, the provincial governments are of importance for their coordinating, planning, and
monitoring role. In addition, issuing NKV certificates gives them a powerful instrument for regulating the
sector. No specific attention is given to environmental issues (like water and waste management). When
it comes to concrete improvements of the slaughtering practices, the district governments are more
important giving their responsibility to enforce the law.
4.6 Access to finance
It is difficult for slaughter point or – house owners to get credit because all permits should be in order
which is never really the case. In the case of slaughter points, basic criteria for loans like collateral, a
bank account, and financial book keeping are not in place. As a way to overcome this situation, some
banks are also active in micro credit. BRI is the biggest bank in Indonesia for micro credit, whilst for
instance Rabobank is not offering micro-credit.
We can state that only the big companies that own the fully automated slaughtering houses are
bankable. In addition, the more risky, the higher the interest up to a level that is not feasible for a small
company (23 – 25%). This hampers the possibility for upgrading and enlarging of existing slaughtering
practices.
All banks have categories of financial products dependent on the amount of the loan, see table 4.6 for a
comparison between BRI and Rabobank (according to one source Mandiri Bank is also becoming active
in the poultry sector).
Table 4.6 Financial products of BRI and Rabobank Indonesia: loans and interest rates (January 2014)
BRI
Rabobank Indonesia
Micro credit
up to 100 million Rps (23%)
People based credit
0 – 500 million Rps (23%)
SME / retail
100 million to 5 billion Rps (15 %)
500 million Rps - 10 billion (14%)
Commercial loans
5 billion to 50 billion Rps (15 %)
10 – 100 billion Rps (12/13%)
Corporate
50 billion + Rps (13%)
100 billion + Rps (12/13%)
We can conclude that innovative financing instruments will be needed to back-up the desired upgrading.
Or to seek for non-commercial funding mechanisms as offered by a diversity of foundations. The
Rabobank Foundation is supporting only smallholder cooperatives and/or farmer groups in the rural
area of Indonesia through small grants (up to 20 million Rps), technical assistance, a guarantee for a
loan, and a soft loan. The slaughtering business is not within their mandate.
Another foundation operational in Indonesia, Ford Foundation, has previous experience with supporting
micro credit institutes in Indonesia. The current emphasis of the foundation is focusing on rural
development in East Indonesia; however a program to also support urban development is being
explored. In any case, the focus is on small holders /SMEs.
Page 24 of 66
4.7 Markets (and consumers)
The Jakarta Greater Area composes out of more than 27 million consumers. In and around Jakarta
several markets can be distinguished. Consumers buy whole chickens at the traditional wet market, in a
kiosk, or in small or large supermarkets. Each marketing channel has its own sourcing. In general the
traditional market gets the birds from a slaughter point and the large supermarkets get the whole birds
from the large slaughterhouses.
Traditional market
Most consumers prefer to buy their chicken at the traditional market. There are no reliable data about
the total number of wet markets, but it is understood that at least one wet market exist per
village/community. A chicken should be warm (= fresh). Cool chicken is associated with too long dead,
not healthy. In most of the cases poultry is purchased to prepare immediately, the same day. This
system (slaughter point and wet market) is responsible for 80-85% of poultry production and
consumption (Personal note Indrawan, 2013). Broilers entering the wet market can come from all types
of farms.
Kiosk / vendor
From the slaughter point the carcasses go directly to vendors or to a kiosk, which distributes them to
vendors. In both cases cash flow has to be arranged. Vendors sell the carcasses from a stall at the street
or at a covered market. Prices are to some extent negotiable. The later after slaughtering, the lower the
price. Carcasses that are not sold in time are traded to ready to eat stalls (after preparation shelf life is
extended significantly) or treated with formalin for sales the next day, from under the counter.
Supermarket and other cooled outlets
Supermarkets have a shelf with different types of poultry and also parts. Sales of poultry through
supermarkets are rather limited. Supermarkets can use ‘left over’ poultry in their ready to eat products.
One of the integrators (Sierad) is experimenting with own shops (Bel Mart, 14 in 2013), providing
poultry meat, eggs and some long shelf food products (rice, spices). They aim with these cooled
products and personal service on higher middle class. CP also has its own outlets for poultry (Prima
Freshmart) of which 94 in Jakarta Greater Area.
Some consumers use the supermarket to check for prices of chicken. The (consumer) market price for
chicken is set at the wet market.
Table 4.7 gives the main characteristics of the three marketing channels.
Table 4.7 Comparison of the different markets
Slaughter Point
Small Slaughter House
warm
cooled
cooled
product
with head and feet
with head and feet
without head en feet
packing
none
temperatur
slaughter
enviroment
market, main outlets
Large slaughter house
plastic bag per bird consumer package, labeled
manual
partly-automated
partly/fully automated
not controlled
semi controlled
waste/water cleaning
wet market
local supermarket
super/hypermarket
Page 25 of 66
The main difference for the small and large slaughterhouses is the cooling of the carcass and the
packaging. Part of the slaughter process is automated with birds on shackles resulting in a more hygienic
way of the slaughtering (not on the floor like in slaughter points). Some small slaughterhouses have
waste water control and all large slaughterhouses have some kind of waste control and water cleaning
system.
4.8 Constraints for upgrading
There are several constraints in the value chain whereby the focus of this paragraph is on the current
production systems of poultry meat slaughtering. Per system (slaughter points, semi-automated
slaughterhouses, and the fully automated slaughterhouses) there are differences in level of constraints.
The categorization of Kaplinski and Morris (2002) is used, identifying these value chain constraints in:
1.
2.
3.
4.
5.
Access to finance
Access to markets
Access to knowledge
Access to infrastructure
Access to institutions.
These constraints are defined as follows:
Ad 1. The access to finance is defined as: The level of access to formal financial instruments (loans):
having (or in potential able to have) collateral, a bank account, professional book keeping.
Ad 2. The level of access to the end consumers, in this case the people living in the Greater Jakarta Area.
Ad 3. The level of access to knowledge on i) food safety, ii) environmental sustainability (waste
management), and iii) running a business.
Ad 4. The level of access to in particular i) roads, ii) electricity, iii) clean water, IV) facilities, and v)
information communication technology.
Ad 5. The level of access to policy, rules and regulations as well as the actual presence of chainsupportive institutions like associations.
Below the findings are put in table 4.8. The operationalization and explanation is described below the
table.
Table 4.8 Constraints for upgrading per slaughtering system
Slaughter points
Semi-automated
slaughterhouses
Constraints in access to finance
YES
+/Constraints in access to markets
NO
NO
Constraints in access to knowledge
PROBABLY YES
MAYBE
Constraints
in
access
to
infrastructure
i) Roads
NO
YES
ii) Electricity
YES
NO
iii) Clean water
YES
+/iv) Facilities
YES
+/Socio-economic analysis of the slaughtering systems in the poultry meat sector
Fully
automated
slaughterhouses
NO
NO
NO
YES
NO
NO
NO
Page 26 of 66
Constraints
institutions
in
v) ICT
access
to
+/YES
+/+/-
NO
NO
1. Access to finance
Cash flow is an important factor in the poultry chain. Most small slaughter point owners cannot wait for
payments more than a day. Here brokers come in. They are not matchmakers but financers. For
entrepreneurs that want to scale up, getting money is difficult. Almost all banks work according to the
western system. Sharia banking is very rare. Currently banks only provide loans if there is security (a
building, land or any real estate) and the business is formally licensed. Almost all slaughter points are
informal and therefore have no access to capital from banks. To a lesser extent also small
slaughterhouses face these problems but often the larger the business the easier it gets to obtain
financing. Industrial slaughterhouses do not face any problems in obtaining financing.
2. Access to markets
Access to the final consumers in the greater Jakarta area is not considered as a constraint for none of
the slaughtering systems. The sector is market driven with a growing demand, and end-consumers that
can be reached easily via a meshed network of wet markets or retail.
3. Access to knowledge
The level of access to knowledge on i) food safety, ii) environmental sustainability (waste management),
and iii) running a business is more difficult to analyze.
The analysis has not resulted in a clear picture on whether the level of knowledge is actually a
constraint. The findings are however clear that in many cases the day-to-day practice is questionable,
for sure at the slaughter points, but also at the semi-automated slaughterhouses. If knowledge exists, it
is often not applied. The risks of environmental pollution (river water, chemical and microbiological
contamination) are huge, just as the risks for chemical contamination of the meat through the live
broiler (no drug withdrawal period in broiler production) or due to (mis)use of disinfectants and
formaline to treat carcasses.
The large number of slaughter points, their micro level of operations, and (most likely) minimal
educational background from the people involved, are constraining training or other capacity building
opportunities. Access to such options is easier for staff of small and industrial slaughterhouses, because
of the more restrictive and organized number, and – in case of the industrial slaughterhouses –
professional organizations.
4. Access to infrastructure
A good physical infrastructure of roads is of eminent importance for the poultry sector. An increase of
the economy of scale will need roads that can handle larger (quantities of) trucks. However, most
country roads can only take small trucks (up to 3 ton of bagged feed, 2000 broilers). Larger vehicles are
for most farms out of the question because of the poor state of infrastructure. Industrial slaughter
plants, where 20.000-80.000 birds/day are handled, are located close to high ways to handle the
multitude of logistical dealings and traffic.
For the small slaughter points the roads are less a constraint because they have adapted to the network
of small roads, operating with small quantities and with motor cycles and small trucks.
Access to electricity is important as a precondition for upgrading to a cold chain. Electricity is not
available at slaughter points, and cannot be guaranteed in near future either. Electricity is available at
Page 27 of 66
the small and industrial slaughterhouses; sometimes even generators are present to take over electricity
supply in case of power cuts.
Upgrading the slaughtering practice towards a more food secure and environmentally sustainable
operation needs clean water and a (waste) water management system. Farms, slaughter points and
slaughter plants have all their own water system (surface water or deep well ground water). The large
slaughter plants have a water treatment system, and (some) quality control on the water. Access to
clean water for slaughter points and small slaughter plants is a risk factor.
Regarding access to facilities it is relevant to note that the big integrators, who own the fully automated
slaughterhouses, also own feed mills and (grand)parent stocks. As a result, the integrators are in the
position to influence the input up-stream and are able to influence the sector. Due to the vertical
integration, they can control the distribution of costs and profits through the production chain. They
also sell feed and day-old-chicks to independent farmers. Feed caters for around 70% of the on-farm
costs.
Information communication technology (ICT) is important for running a professional business with fully
up-to-date market information (supply, demand, and prices), monitoring of key performance indicators,
and running modern processing equipment. For small slaughterhouses, investing in ICT is costly, and
would need additional resources. For slaughter points the picture is mixed: they do not have the
resources for investing in ICT, but also do not need to do so. Access to market prices is important, but
can be obtained easily via mobile phones.
5. Access to institutions
Access to institutions is concerning the level of access to policy, rules and regulations as well as the
actual presence of chain-supportive institutions like associations.
The rules and regulations in itself are not constraining, neither the information on these rules and
regulations, but the fact that they are hardly enforced by the respective authorities. The district
governments have a key role in law enforcement and the Provincial governments have an important
coordinating, planning, and monitoring role. The implementation of these roles needs attention.
In addition, transparent mechanisms for market-oriented policy development, implementation and
monitoring are absent. Certification requirements for starting-up a new slaughterhouse are known,
however in practice not required for the slaughter points.
Part of these regulations is the tax system. The big, fully automated slaughtering houses pay a corporate
tax of 25% over profit. All the other companies and small holders are not paying tax, but small
slaughterhouses pay a fee per bird slaughtered. Upon the moment scaling up takes place, these
businesses will become more visible hence taxes are to be paid, if profit is made. By keeping it small (or
informally networked) one stays ‘below the radar’. This factor contributes significantly to the uneven
competition between slaughter points and more mechanized, more hygienic larger scale
slaughterhouses.
An association of the large companies does exist: ARPHUIN, Asosiasi Rumah Potong Hewan dan Unggas
Indonesia/Indonesian Slaughterhouse Association. Also some of the smaller slaughterhouses are
member. The main chain actors in the sector do not sufficiently cooperate for the benefit of the sector
Page 28 of 66
as a whole. As a result, no strategizing and coordinated planning is taken place. It also results in large
short term fluctuations in prices of poultry. Charnoz and Forster state that these price fluctuations are
caused on purpose by the big companies for speculation by fluctuating the level of production (Charnoz
& Forster, 2011). This is causing problems for farmers and slaughterhouses. When prices are high
slaughterhouses take a lower number of birds because the higher costs cannot be transferred to the
market. Production in the chain is not efficient in this way and is hampering modernization and
upgrading. Also prices of DOCs can vary highly, again controlled by the same big companies. This is
causing problems in the planning of breeder flocks and hatcheries.
The slaughter points are not organized formally but informally, often intertwined with family or other
social networks. In the wet market system in Jakarta there are 60.000 to 65.000 people involved (IPB,
2013), that generate a daily income. Most of them not have a full time job, but the income is sufficient
to survive with a family. The number of people that make serious money in this system is difficult to
estimate. Between all players in the system there are close connections, either as family or as business
partners. To replace such a system requires at least alternatives for the ones now having an income
from the system.
On international level, the relevant institution is ASEAN. By January 2016, the ASEAN economic
integration will start to materialize, although it is unlikely that import restrictions on poultry products
will disappear easily. But the principle remains that the sector is vulnerable for international
competition. In case of an increase of (frozen) imported chicken meat to Indonesia, it will affect mainly
the industrial cold chain with the industrial slaughterhouses. It is expected that the large (multinational)
companies that own the industrial slaughterhouses have access to the political leaders, lobbying for
their business interests.
In summary one can state that the slaughter points have many constraints for upgrading contrary to the
industrial slaughterhouses whereby the semi-automated slaughterhouses are facing a mixture of
constraints.
Page 29 of 66
5. Conclusions and recommendations
5.1 Conclusions
Indonesia is growing rapidly. With an increase of on average 6% of GPD per year also the purchasing
power of the average Indonesian is growing. As a result domestic poultry meat production will double in
the next 5-6 years. In addition the society is becoming gradually more food-cautious and food-safety is
increasingly becoming an issue. However, a primary motive of consumers of what kind of poultry to buy
remains price (source consumer survey). Improvement of both hygiene levels and efficiency in the
production system in order to reduce price is therefore required. This study concentrated on the
possibility of upgrading poultry slaughtering processes. Three systems were identified: slaughtering
points, semi-automated slaughtering houses and large, fully automated slaughter industries.
Small informal slaughter points are characterized by the fact that it is often an informal part-time
business of individual households. The number of chickens slaughtered per day is small and food-safety
regulations are often not adhered to. In order to increase the hygiene level, the business owners have to
invest in hygiene knowledge, practice and machines. In order to improve the efficiency of their
production systems the business needs to upscale. But as these businesses are informal no banks are
providing loans to facilitate up-scaling. And in terms of hygiene, the low effort of enforcement of the
government in controlling food-safety does not contribute to better food-safety. Moreover, there are
also many small slaughter points which are often dispersed all over the Greater Jakarta Area which
makes control difficult especially as slaughtering is occurring during night hours, the time government
officials are resting.
Upgrading seems to be only possible if these informal businesses can become formal and are willing to
upscale. Both issues are found to be difficult. Many businesses are part-time and are not willing to
upscale and even if they would like to do so they lack the finance and or the space and as a result they
are also not investing in better hygiene processes. Changing the attitude of the owners as well as
changing the status of the businesses would be very costly, just because there are so many. Moreover, if
they change, it is still no guarantee that they will be successful as a small slaughterhouse because that
would require additional business and technical skills.
The semi-automated slaughterhouses are limited in number (36) and are often characterized by the fact
that these are formal businesses, full-time in operation and that the managers are having more business
and technical skills than the slaughter points. However, access to capital remains often difficult which
has implications for both up scaling possibilities and improved hygiene level. In general it can be
concluded that up scaling interventions at this system seems to be less costly as less businesses are
involved but also because with a bit of extra support these businesses can become more hygiene
conscious and can also develop more efficient production systems.
The larger industrial slaughterhouses do not need a lot of support as they are often working already
according to the latest efficiency and hygiene standards. As a model for best practice they are of interest
for the smaller slaughter houses.
Page 30 of 66
Finally if the constraints are observed more closely it can be concluded that interventions should be
focused on three main areas. First of all access to finance what is a key driver for change. To improve the
access to finance it is required to develop further up-scaling aspirations.
Next infrastructure needs to be upgraded; especially narrow roads are an obstacle for trucks to
transport large quantities of chickens affecting the production process.
Finally, the business and government need to work more together in developing and maintaining the
required hygiene levels but also in obtaining economies of scale in their production processes. Tax
exemptions might for example be helpful in this process of upgrading.
5.2 Recommendations
In line with the conclusions as formulated above, it is recommended that possible interventions should
focus on specific aspects to be successful:
1. Strengthening public-private cooperation at district level
In order to address infrastructural, institutional and business constraints public-private partnerships
should be developed. There is a need for increased cooperation among public and private parties in the
sector. Given the importance of geographical diversification and the important role of district
authorities, it is suggested to help bring together public and private parties on district level. The aim
would be to facilitate trust building among the key actors, to come up with scenarios, and to agree upon
pilots that also involve private partners (B2B).
Scenarios that could be developed in these district platforms could be on requirements for hardware
(poultry houses, slaughter houses, parent stock, hatcheries, feed production, etc.), software (capacity
building in the private and public sector) and orgware/infrastructure (hard: infrastructure: building plots,
road access, water availability and quality and soft: building permits, organisation among public and
private sector, veterinary infrastructure, etc.). Scenarios may focus on different scales of production
(based on small holders to large farms and slaughter plants) and different organisation models
(independent producers, integrated situation).
2. Upgrading semi-automated slaughter houses to become small integrators
The smaller slaughter houses are essential for meeting the growing market needs and for creating a
geographical net of slaughterhouses around Jakarta. In the current situation however, they are too small
to meet the growing demand, the increasing competition (ASEAN) and have too little resources for the
needed investments. Hence, the semi-automated slaughter houses will need to grow and innovate. The
way forward is to support the semi-automated slaughter houses to become small integrators, able to
have control of input, throughput and output.
This could be combined with:
3. Slaughter house innovation
It is worthwhile investing in designing new types of slaughter houses that are more cost effective and
environmentally sustainable. Slaughter houses in Indonesia use in general international equipment, but
with quite a lot manual labour. Besides, systems for cooling and cleaning require a lot of water and
(purchased) ice. In many (smaller) slaughter houses coops and waste water are not cleaned. Intake of
Page 31 of 66
good quality water is another issue to consider and stunning of poultry according to Halal rules. Also
different systems are used for climatising the slaughter plant.
4. Availability of investment capital
It is recommended to explore the possibility for large investors and eventually the set-up of a security
fund for the poultry sector. This might be completely public, but a public–private partnership is also
feasible. Availability of capital for investments is a crucial factor for further development of the poultry
sector in Indonesia. Many smaller entrepreneurs mention the availability of capital against affordable
interest as a major problem for investments they would like to do. Investments are required in both the
primary production of poultry (housing) and processing (slaughter plants). In several countries the
poultry (agricultural) sector was and is supported by loans at a reduced interest rate. The reduced
interest rate is obtained by facilitating the bank sector with a security ‘safety net’ fund. This security
fund reduces the risk for the financial sector and promotes further business development in the poultry
sector.
5. Support to District and Provincial governments
The district governments have a key role in law enforcement and district specific economic
development. The Provincial governments have an important coordinating role, and can co-fund districtlevel activities. Specific attention could be given to support districts to fulfil their pertinent role more
adequately, through training, strategic plan development, monitoring mechanisms, and benchmarking.
Page 32 of 66
6. References
ACIAR. (2010, December). Evaluation of a Potential Niche Market for poultry products from biosecure
farms in Indonesia. Case study: Bali, West Java and South Sulawesi. ACIAR.
Agrina. (2013, November 16). Yang Fresh Masih Pilihan. Retrieved from Agrina: http://www.agrinaonline.com/redesign2.php?rid=7&aid=4733
Charnoz, O., & Forster, P. (2011). The Global Health Impact on Local Power Relations; Fragmented
Governance, Big Business and Organisational Bias in Indonesian Animal Health Policies. Working
Paper WP 02/2011. LSE Global Governance.
Daryanto, A. (2011, March). Contract Farming in the Broiler Supply Chain in Indonesia; Linking Farmers
to Markets. Bogor: IPB.
Embassy of the Kingdom of the Netherlands. (2013). Identification Mission on the Livestock Component
of the Dutch-Indonesian Programme on Food Security. Jakarta: Embassy of the Kingdom of the
Netherlands.
FAO. (2011). A value chain approach to animal diseases risk management. Animal production and health
guidelines, no 4.
Forster, P. (2009). The Political Economy of Avian Influenza in Indonesia. STEPS Working Paper 17.
Brighton: STEPS Centre.
Gereffi, G., Humphrey, J., & Sturgeon, T. (2005). The governance of global value chains. Review of
International Political Economy, 78–104.
Indonesia Finance Today. (2013, November 25). 2014: Animal Feed Industry Growth Potentially
Decelerates. Retrieved from Indonesia Finance Today:
http://en.indonesiafinancetoday.com/read/37399/2014-Animal-Feed-Industry-GrowthPotentially-Decelerates
Indonesian Commercial Newsletter. (2011, August). The Market of Broilers in Jakarta and Surrounding
Areas. Retrieved from DATACON: http://www.datacon.co.id/ColdStorage-2011Chicken.html
Kaplinsky, R., & Morris, M. (2002). A Handbook for Value Chain Research. Institute of Development
Studies.
Maastricht School of Management, Bogor Agricultural University, Wageningen University and Research
Centre. (2013). Dutch-Indonesian Program on Food Security: Poultry & Dairy Sector Components
Work Plan Inception Phase; Work packages 1 and 2. Proposal.
Page 33 of 66
Ministry of Agriculture, Indonesia. (2006). Guidelines on chicken slaughtering and chicken meat handling
in small scale chicken slaughterhouses. Jakarta: Ministry of Agriculture, Indonesia.
Mudde, H., Indrawan, D., & Fahmi, I. (2012). Multi-sector partnerships for sustainable business
development in Indonesia: the role of higher education. Working Paper No 2013/01. Maastricht:
Maastricht School of Management.
OECD. (2012). OECD Review of Agricultural Policies: Indonesia 2012 . Retrieved from OECD Publishing:
http://dx.doi.org/10.1787/9789264179011-en
OSK. (2012, November). Indonesia Equity. Sector Update: Poultry Sector. Prospects Abound in Poultry
Business. OSK Research.
Pefindo. (2009). Poultry Industry. Pefindo.
PT Japfa Comfeed Indonesia Tbk. (2013, December). JAPFA Investor Presentation.
Rabobank. (2011). Kumar, P. Indonesia Animal Protein Industry. Rabobank Industry Note # 292.
November 2011. Rabobank.
Rabobank International. (2013). FAR research and industry sources.
Sudarman, A., Sumiati, Ekowati, H., setiyono, A., Mulatsih, S., & Kusumaningrum, R. (2008). Poultry value
chain study and avian influenza risk assessment in Jakarta surrounding area. Final report. Bogor:
Center for Tropical Animal Studies (Centras), Bogor Agricultural University, for the Food and
Agricultural Organization (FAO).
Tacken, G., Immink, V., Indrawan, D., Snoek, H., & Sumarwan, U. (2014 (forthcoming)). Preferences for
poultry meat. Consumer study in the Jakarta region. Wageningen: WUR.
The Poultry Site. (2014, January 24). The Poultry News: Chinese Consumers' Tastes Are Changing.
Retrieved from The Poultry Site: http://www.thepoultrysite.com/poultrynews/31275/chineseconsumers-tastes-are-changing
USAID. (2013). Strategies against flu emergence. Final report.
USAID. (2013, February). Indonesia’s Poultry Value Chain. Costs, Margins, Prices, and other Issues.
Wageningen University and Research Centre. (2013). Dutch-Indonesian Programme on Food Security.
Poultry & Dairy Sector Components. Work plan and cost estimate. Animal Sciences Group.
Wageningen: Wageningen University and Research Centre.
Page 34 of 66
Annex 1. Terms of Reference of the study
Goal
To identify the drivers and constraints for change towards more food secure poultry processing in West
Java. Strategies will be developed to support such a transition.
Results of the Inception Phase
1. Qualitative description of the present situation of different poultry supply chains in which 3
slaughtering system are part (small-scale, semi-automated and fully automated). This gives insight in:
2. Overview of drivers and constraints for upgrading the poultry slaughtering system towards more food
secure processing.
Methodology
Desk research
Qualitative survey among chain partners and stakeholders in and around Jakarta
Number of semi-structured interviews: 30
Activities
1. Define and agree upon work plan, planning and task division
2. Desk research: collect and analyse previously executed research and chain partners and
stakeholders mapping
3. Design research methodology, research questions, units of analysis, sampling, identification of
selection criteria
4. Identify relevant chain partners and stakeholders for each of the supply chains
5. Research operationalization: design and pre-test 3 questionnaires & translation EN -> bahasa
Indonesia
6. Conduct chain actors & stakeholder interviews
7. Identifying drivers and constraints for upgrading the poultry slaughtering system
8. Validation
9. Analyzing and reporting
Roles
MsM
•
•
•
•
•
•
IPB
Coordination
and
management
Liaison with IPB
Desk research
Research
methodology
Research
operationalizatio
n
Chain partners
and stakeholders
interviews
LEI
•
•
•
•
•
Desk research
Research
methodology
Chain partners
and
stakeholders
identification
Research
operationalizati
on
Testing and
organizing
interviews
•
•
•
•
•
Desk research
Research
methodology
Research
operationaliza
tion
Chain partners
and
stakeholders
interviews
(support)
Analysis
ASG
•
•
•
•
Desk research
Research
methodology
Chain partners
and
stakeholders
interviews
(support)
Analysis
Page 35 of 66
•
•
•
(support)
Validation
Analysis
Reporting
•
•
•
•
Translations
Chain partners
and
stakeholders
interviews
Validation
Analysis
Missions (5 working days + 2 travel days)
1. MsM/Huub Mudde: Project management
2. MsM/Diederik de Boer: Validation and analysis
3. LEI/Peter van Horne: Support in chain actor interviews
4. ASG/Ferry Leenstra: Support in chain actor
Page 36 of 66
Socio-economic analysis (work package 2.1)
Responsible
Outputs & activities
MsM IPB
1
2
Define and agree upon work plan, planning
and task division
Desk research: collect and analyse
previously executed research and chain
partners and stakeholders mapping
LEI
Oct November
I
ASG
X
2
4
2
2
II III IV
X*)
X
December
January
I
II
III IV
I
X
X
X
II
Design research methodology, research
questions, units of analysis, sampling,
identification of selection criteria
3
3
4
1
X
X
4
Identify relevant chain partners and
stakeholders for each of the supply chains
2
5
2
1
X
X
5
Research operationalization: design and pre- 3
test 3 questionnaires & translation EN ->
bahasa Indonesia
15
5
3
6
Conduct chain actors & stakeholder
interviews
Identifying drivers and constraints for
upgrading the poultry slaughtering system
2
10
7
7
X
X
5
5
2
2
X
X
8
Validation
1
4
0
0
9
Analyzing and reporting
5
4
3
2
Coordination and management, incl liaison 4
0
0
0
with IPB
Total days
27
50
25
18
III IV
V
I
II
III IV
X
3
7
February
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
*) Details to sort out with IPB management
during mission
**) Christmas / new year break in the
Netherlands
Page 37 of 66
Version February 7, 2014
Detailed work Plan
1. Define and agree upon work plan, planning and task division
This work plan is developed in this phase of the project. The theoretical models (relevant for the
research questions), that are the base for the consumer study in the inception phase of the project are
selected and the research objectives are defined. At the start, a working session will be organized at
MsM with the key Dutch experts.
2. Desk research: collect and analyse previously executed research and stakeholder mapping
Result: Recommendations / guidance for research / conceptual framework
Action: IPB, LEI, ASG, MSM
3. Desk research: collect and analyse previously executed research and chain partners and stakeholders
mapping
In this phase of the project the results of the desk research are translated to a research methodology. In
this methodology, the goal of the socio-economic analysis will be further detailed defined, the sample
will be determined, and the locations will be selected based on agreed criteria.
Result: Detailed research methodology and protocol
Action: IPB, LEI, MSM
4. Identify relevant chain actors (direct/indirect) and stakeholders for each of the slaughtering systems
Result: list of relevant stakeholders to interview
Possible chain actors (direct/indirect):
• Owners / managers of small scale slaughtering facilities, semi-automated slaughterhouses and
fully automated slaughterhouses
• Farmers and Farmers Associations (a/o GOPAN)
• Middlemen and traders
• Private sector (a/o Pt. Sierad, Pt. Charoen Popkhand)
• Providers of feed, DOC and credit
• Retail (Hypermarket, Indomarket)
• Investors / banks
• Inspectorate
• Provincial and national government
• Members of the Indonesian Poultry Advisory Council.
For each of the slaughterhouse systems a detailed description of persons involved, their role will be
made.
Action: IPB
5. Research operationalization: design and pre-test 3 questionnaires & translation EN -> bahasa
Indonesia
In this phase of the project separate semi-structured questionnaires will be developed for farmers,
traders and slaughter facility owners are designed and tested on basis of the developed research
methodology. If the questionnaires are completed they are translated from English to Bahasa Indonesia
and tested in Bogor region, whether it is workable.
Page 38 of 66
Result: Validated questionnaires
Action: IPB, LEI, MsM
6. Conduct chain actors & stakeholder semi-structured interviews, around 30 in total
In all three slaughtering systems persons in the different links will be interviewed with a prime focus on
the slaughterhouse actors:
• Small scale slaughtering: total around 10 interviews with slaughter man, traders and farmers
• Small semi-automated slaughterhouse: total 10 interviews with slaughter man, traders and
farmers
• Automated Slaughterhouses: total 3 interviews with integrated company and farmers.
Besides about 7 interviews will be carried out with inspectorate, provincial and national government,
retail and credit providers.
In the interviews with the farmers the focus will be on the following aspects:
- Size of the farm
- Supply of day old chicks and feed
- Disease control
- Conditions on delivering the broilers ( batch size, quality, transport)
- Method of payment (conditions, credit, personal contacts)
In the interviews with the slaughter man the focus will be on the following aspects:
- Size of the company, structure and organization, ownership, part of integration etc.
- Supply of birds (transport, logistics, bird quality, live weight)
- Method of slaughter (stunning, scalding, offal disposal, water cleaning)
- Storage (cooling facilities, quality control)
- Method of payment
- Food safety
Action: IPB, MsM, LEI, and ASG
IPB will hold the interviews in all links in the three supply chains. Researchers of LEI, ASG, and MsM will
join in the fieldwork. In total 3 persons of MsM, LEI and ASG will cooperate for each 1 week (5 working
days) with an IPB researcher to get an impression of the actual field situation.
7. Identifying drivers and constraints for upgrading the poultry slaughtering system
Based on the results of the interviews a number of potential incentive mechanisms to improve food
security and food safety for the different parts of the supply chain will be developed.
Result: list of most potential options for upgrading in the different slaughtering systems
Action: IPB, MsM
8. Validation
The tentative results of the interviews will be validated among a selection of experts
Result: validated results
Action: IPB, MsM
9. Analyzing and reporting
Final analysis of the results and formulation of possible scenarios for upgrading of the slaughtering
systems during project implementation
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Result: Scenarios for upgrading
Action: MsM, LEI, IPB, ASG
Experts
• Diederik de Boer, MsM (lead)
• Arief Daryanto, IPB (IPB-lead)
• Peter van Horne (WUR/LEI-lead)
• Ferry Leenstra / Adriaan Vernooij/ Sander Lourens (WUR/ASG)
• Idqan Fahmi, IPB
• Dikky Indrawan, IPB
• Huub Mudde, MsM
• Ron Bergevoet, WUR/LEI
Page 40 of 66
Annex 2. List of interviewees
Monday December 16th 2013, market visits and 2 workshops
Morning, market visits
Visit Pasar Bogor
Supermarket Giantin Bogor
Afternoon Session / workshop with integrators at Bogor University
- Mr. Aryo Widiwardhono, Managing Director - Foods Division PT. Sierad Produce, TBK
- Mr. Daud, Director PT. Sierad Slaughterhouse
- Mr. Ferdiansyah Gunawan Tjoe, Director PT. Charoen Pokphan Indonesia, Tbk
- Mr. Ahmad Dawami, Senior Vice President Director PT. Japfa Comfeed. Chairman of ARPHUIN (Asosiasi
Rumah Potong Hewan dan Unggas Indonesia/Indonesian Slaughterhouse Association)
Evening Session / workshop with small slaughterhouses at Bogor University
- Mr. Nono Tri Kesowo, Director of Inasa –
Farmers and Small slaughterhouse (rents a local government facility)
- Mr. Asep Syaeful, Director of CV. Jambu Raya –
Farmers and Small slaughterhouse at CIpaku Bogor
- Mr. Tri Hadianto - Farmers - Chairman of GOPAN (Gabungan Organisasi Peternak Ayam
Nasional/Association of National Broiler Farms Organization)
Tuesday December 17, 2013. Farm, trader, 2 small slaughterhouse and slaughter point
- Farmer. Small broiler farm
- Small slaughterhouse of Mr Nono + cooling and freezing facilities
- Mr. Wayan, Broker/Trader of Broiler in Jakarta Greater Area (lunch time)
- Small slaughterhouse of Mr Asep Syaeful, Jumbo Raya.
- Mr. Anto, Small slaughter point at Kebon Pedes Bogor (at night
Wednesday December 18, 2013 , Large slaughterhouse
Morning visit to Sierad industrial poultry slaughterhouse in Bogor and interview with:
Mrs Indra, Quality Control and Purchase Manager at PT. Sierad Slaughterhouse
Mrs Meta, Public Relation at PT. Sierad Slaughterhouse
Afternoon visit to Collector farm in Jakartha
- Mr. Asrori Gagarin, Manager of PD Dharma Jaya (Jakarta owned enterprise. Manager of Collecting
Farm Area at Pulo Gadung, DKI Jakarta
Thursday December 19, 2013. Interview and shop
Dr. Denny Lukman, Lecturer of Faculty of Veterinary IPB
Visit to poultry store, Bell Food
Saturday December 20, 2013. Interview
Mr. Eddy Heutink, Head poultry production Pt. Charoen Pokphand Jaya Farm
Wednesday January 16, 2014
Project meeting with Ivo Claassen and Frank Joosten
Thursday January 17, 2014
Interview with Mr. Sutrisno, Director Animal Health and Fishery Agency, Bogor District
Page 41 of 66
Friday January 18, 2014
Interview with Prof. Dr. Sjamsulbahre, Professor in the Toxicology, IPB, coordinator A I.
Monday, January 20 , 2014
Interview with Mrs. Liestiowaty, Deputy President, Corporate Clients, BRI
Tuesday, January 21, 2014
Interview with Dr. Hartono, President, PINSAR
Wednesday January 22, 2014
Interview with Mrs. Agung, Branchmanager, BRI Bogor
Interview with Prof. Dr. Arief Sunanto, IPB
Thursday January 23
Project meeting with Dr. Fahmi, IPB
Mrs Windy Sarawati, Head of Branch, Rabobank International Indonesia, Bogor Branch
Friday January 24
Mr. Stephen Widjaja, Project Manager Rabobank Foundation Indonesia (Jakarta)
Saturday January 25/Sunday January 26/ Monday January 27
Desk study and report writing
Tuesday January 28
Meeting with Arief Daryanto, IPB-MB
Report writing
Wednesday January 29
Dr Hartono, Chair of PINSAR (Poultry Farmer Association): validation meeting
Final meeting with Arief Daryanto, IPB-MB
Report writing
Thursday January 30
Mr Kusmayadi, former Head of Livestock Department of the Province of West Java (till January 24, 2014)
Mr Rafiuddin Palinrungi, Ford Foundation Indonesia (by phone)
Page 42 of 66
Annex 3. Questionnaires socio-economic situation of slaughtering systems
Method
Is semi structured interview. Based on chain with farmer, trader, slaughter and market.
Questionnaire divided in general, input, output, costs, food safety/disease control, strategy/future.
A Slaughtherplace / small slaughterhouse
General
Company name:
Location of place:
Interview with: name, position
Number of birds slaughtered per day (average):
How many days per year: (any season fluctuations?)
Number of workers:
Process
Describe the process of the slaughter (see annex):
Arrival/Stunning/killing/bleeding/scalding/plucking/washing/evisceration/ grading/weighing/
cooling/portioning/ packing….…..
Final product is: whole carcass/parts/…. Delivered ‘warm’ (not cooled), cooled (0-4 oC), deepfrozen (< 20 oC).
Input
Supply:
How many birds supplied today/yesterday:
From how many different flocks/farms? Flock size ranges from … to ..
Fluctuations in supply in range: …. to …..
Method of supply: crates, boxes, ……
Weight of the birds, in average:
Variation in weight in range from …. to …..
Are there any quality conditions on the birds supplied?
In weight (certain range), full fed, foot pads,………
Type of birds?
International breeds, native breed, dual purpose, spend hens…..
Prices:
Buying price of the birds (per bird or per kg live weight)…..Rp (at this moment)
Is there any market price published of the live weight bird (is this an accurate and reliable price).
Any quality payments on the live birds?
Bonus or discount ……. (specify)
Method of payment: cash/other
Output
Product:
How many birds are sold today/yesterday:
In how many batches
Average weight of the bird (carcass weight)
Page 43 of 66
Describe the dressed bird: (photo)
With feet and head on, …….
Warm, cooled or frozen
Do you deliver the products to selling points, or does the buyer do the logistics?
Revenue
Revenue price per bird: …. Rp
Other revenues:
Intestine…………..
Blood………………..
Head/feet…………
Feathers……………
Eatable organs……
Method of payment: cash/other
Environment:
Describe method of disposal of water, blood, intestine
Costs
Costs: estimate the costs per day (later we will divide the cost by the number of slaughtered birds or the
weight of the carcass weight)
Costs of workers:
Number of workers:
Daily working hours per worker:
Cost of a working day (payment to the worker):
Other costs per worker/day (tax, social tax etc)
Building:
Size of the building for slaughter (including storage): m2
Investment of the building (replacement in 2013) per m2
Equipment:
Investment of the all equipment in the slaughterhouse: ….. RP
Interest rate for loans on building and equipment
Other variable costs (in R per day or month or year):
Electricity: kwh / Cost of electricity
Heating (building, water): Rp
Water: amount, price, source (own well, tube)……….
Offal: any cost for disposal of offal, intestine, waste water…..
(any revenues are already mentioned in output)
Food safety
Are samples taken from the birds for analyses on microbes? Salmonella, other.., how often? Can you
show results?
Are blood samples collected for analysis on AI and/or other diseases? How often?
When and how is the slaughter plant cleaned?
Do you sample the slaughter plant after cleaning for microbes? How often Can you show results?
Strategy
What are the main problems for the companies:
Scale of production, regulations, consumer demand, high input prices, low output prices, environment,
food safety, logistics (get live birds in time and deliver products in time), getting loans for investments,….
Page 44 of 66
What are the future plans for the company:
Grow in size, increase quality (food safety certificates), invest in cooling, …….
Expand the chain, i.e. contract farms, own farms, or contracts with buyers (supermarkets, others …)
Invest in training and quality of farmers
Cooperation with other parties (DOC, feed mill, …)
What are the weak point in the current situation of the company”?
What are the strong point in the current situation of the company”?
What are the treats for the company?
What are the opportunities for the company?
B Farmer
General
Farm name:
Location of farm:
Interview with: name, position (owner, manager, worker)
Number of birds housed (average):
Number of poultry houses:
Number of workers:
Type of farm: contract or independent………(describe)
Farm
Describe the farm:
Type of housing (natural ventilation, mechanical ventilation/ type of heating/ slats, litter, cages, …)
Position of poultry houses
Other agriculture/fish on farm
Number of flocks per year
Depopulation: how many birds per day……. Describe
Input
Supply of day old chicks (doc):
Method of transport, breed, quality…..
Always from the same hatchery? Which one?
Supply of feed:
Type of feed, supply in bags, ….
Which supplier? Always the same? On a contract?
Veterinarian service and medication:
By who, specify vaccinations, medications
Method of payment doc and feed (cash, conditions, credit)
Output
Final weight (gram)
Batch size
Catching: who , how often, method
Method of transport
Sales to trader, middle man or direct to slaughterhouse
Is the price dependent on quality of the chickens (how?)
Quality: foot pads, cleanness, ……
Page 45 of 66
Do you get information from the slaughter plant on the quality of your chickens?
Method of payment (cash, conditions, credit)
Performance
Feed conversion (kg/kg)
Mortality (% of number at day 1)
Number of days (to final weight)
growth rate (gram/day)
EPI performance index?
empty days between flocks
Costs
Costs in general of last flock (mention month)
Costs of doc (RP per piece)
Cost of feed (Rp per kg)
Other costs (Rp per flock)
Electricity
Heating
Vet/ medication (antibiotics)
Cleaning and disinfection
Litter
Manure disposal
Catching
Workers:
Cost of a worker per day. Including any social tax or other costs.
Investment:
Investment in building
Investment in equipment
Interest rate on loan for investment
Revenues:
Manure sales…
Sales selected birds
Disease control / food safety
What hygienic measures are taken (specific clothing and/or boots for the farm, for each house? Dip tank
for boots? Hand washing?)
How is the farm cleaned after a flock?
How long is the farm (house) empty before new DOC’s enter?
Are samples taken for disease control, by whom? Can you show results?
How do you dispose of dead birds? (buried, incineration, composted)
Do you report excessive mortality? To whom?
Strategy
What are the future plans for the farm:
Increase size
Improving quality of the birds
Housing systems/ equipment upgrading
Cooperation with feed mill, hatchery, slaughter plant (integration, contracts, ..
Page 46 of 66
What are the main constraints in farming:
Money to invest
Supply of doc or feed
Market demand for live birds
Find good workers
Environmental regulations
Other…..
C Trader
General
Company name:
Location of place:
Interview with: name, position
Number of birds traded per day (average):
How many days per year: (any season fluctuations?)
Number of workers:
Input (from farmers)
How many birds collected today/yesterday
From how many farms:
Method; crates, boxes,
Method of transport: moped, small truck, large truck
Weight of the birds, on average:
Variation in weight in range from …. to …..
Are there any quality conditions on the birds supplied?
In weight (certain range), full fed, ………
Type of birds?
International breeds, native breed, dual purpose…..
Prices:
Price of the birds (per bird or per kg live weight)…..Rp (at this moment)
Method of payment: cash/credit/other
Output (sales to slaughter-point/houses)
To what slaughter points/houses the birds are delivered:
Batch size
Quality conditions
Always the same slaughter point? If more than one, why?
Prices:
Price of the birds (per bird or per kg live weight)…..Rp (at this moment)
Method of payment: cash/credit/other
Page 47 of 66
Costs
Investment in transport vehicles (replacement 2013)
Cost of fuel
Bird losses
Interest on Capital input (‘running money’)
Costs of any collecting place (building, area)
Margin per bird (in average)
Food safety / disease control
Do you take samples for Salmonella, AI, other purposes? How often? Can you show results?
Strategy
What will be the policy when slaughterhouse will improve quality standards or upscale their size?
Disease control?
How can food safety be improved?
D Large scale automated Slaughterhouse / Integrator
Basically same questions as under A.
Annex (slaughter process in general)
Receiving areas
The inlet to the plant is normally designed in such a way that fluctuations in bird deliveries can be dealt
with adequately. This is necessary since the processing capacity has a fixed maximum. At regular
intervals birds are unloaded onto the holding areas and attached by their feet to a conveyor belt,
transported to the slaughter area.
Slaughtering and packing
The birds are suspended from the conveyor after which the following actions take place:
- Stunning;
- Killing and bleeding by cutting the jugular veins;
- Collection of blood. The conveyor travels through a blood collection tunnel at a preselected travelling
speed;
- Scalding. To loosen the feathers, the birds are held in water of temperatures ranging from 50°C to 60°C;
- Defeathering. Feathers are mechanically abraded from the scalded birds, usually by rotating rubber
fingers. Removed feathers drop in underlying troughs;
- Washing. The defeathered carcasses receive a spray wash prior to evisceration;
- Opening of the carcass by cutting manually;
- Inspection of the viscera;
- Evisceration, removal of head, feet and viscera;
- Sorting of the viscera to recover heart, liver and gizzard;
- Final washing to remove blood and to loosen tissues;
- Chilling of the carcasses in a waterbath;
- Draining;
- Grading, weighing and packing; and
- Chilling and freezing.
Page 48 of 66
Annex 4. Map of Greater Jakarta Region with locations of semi-automated and
fully automated slaughtering houses
Source: Authors’ compilation based on KESMAVET, Veterinary Public Health Laboratory; MUI, Majelis
Ulama Indonesia
Page 49 of 66
JAKARTA
Rumah Potong Unggas Rawa Kepiting (Public Governance Slaughterhouse)
jalan rawa Kepiting, Kawasan Industri Pulo Gadung, Kelurahan Jatinegara RT 09 RW 10, Kecamatan
Cakung, Kota Administrasi Jakarta Timur
Rumah Pemotongan Unggas cakung (Public Governance Slaughterhouse)
Jalan raya Penggilingan, Kecamatan cakung, Kota administrasi Jakarta Timur
Rumah Pemotongan Unggas Petukanganan Utara (Public Governance Slaughterhouse)
Jalan Mochtar (Kawasan Kebun Bibit Petukangan Utara), Kelurahan petukangan Utara, Kecamatan
Pesanggarahan, Kota Adminsitrasi Jakarta Selatan
Rumah Pemotongan Unggas PT Kartika Eka Dharma (Small / Semi Automated Slaughterhouse)
Jalan swadarma Raya No. 69, Kelurahan Srengseng, Kecamatan kembangan, Kota Administrasi Jakarta
Barat.
Rumah pemotongan Unggas Pulogadung (Public Governance Slaughterhouse)
Jalan Palad No.2 (Kawasan RPH Pulogadung), Kelurahan Pulogadung, Kecamatan Pulogadung, Kota
Administrasi Jakarta Timur Kode Pos: 13260 Phone: 021 4704706
Sari Niaga Pacific (SNP) Subanga (Small / Semi Automated Slaughterhouse);
Jl Kamboja 2-E RT 005/01
Tomang, Grogol Petamburan
Jakarta Barat 11440 DKI Jakarta
Telepon Lainnya: (021) 56968794, 56960511
RPA PT Unggas Prakarsa (UP) (Small / Semi Automated Slaughterhouse)
Jalan Kalibaru Timur Iv A 14 No. - Rt.003/001
Kel : Kali Baru,
Kec : Cilincing, JAKARTA UTARA
DKI JAKARTA - INDONESIA 14110
021.44836465
Page 50 of 66
BOGOR
PT Belfoods Indonesia. (Automated Slaughterhouse)
(Slaughter House & Processing).
Citra Indah Complex Kav. PA1-2, Jl. Raya Jonggol Km. 23.3, Jonggol
Tel : +(62-21)-7182419.
Fax : +(62-21)-7196443.
RPA Putra Mandiri /Starfood (Small / Semi Automated Slaughterhouse)
Jl Branta Citeureup, Kab Bgr.
Fax: +62251-8755845
Suwandi.
HP1 : +628138874944.
HP2 : +6281387273838
PT Ciomas Adisatwa (JAPFA) (Automated Slaughterhouse)
Jalan Raya Parung Km. 24, , Gang Sawo No 25, Desa Jampang, Bogor, Jawa Barat.
Agri Mustika Indonesia (AMI) (Small / Semi Automated Slaughterhouse)
Jl.Raya Alfalah .Gg.Damai Rt.01/09 no.10,Cikaret.Kel.Harapan Jaya- Cibinong, Kota Bogor 16914
Page 51 of 66
RPHU SK Cibinong (Public Governance Slaughterhouse)
Gg H Ashari, Cibinong, Jawa Barat 16911
UPTD. RPH DINAS PERTANIAN (Public Governance Slaughterhouse)
Jl. KH . Abdullah Bin Nuh RT 02/01 Kel . Bubulak Kec. Bogor Barat Kota Bogor
UD. SEJAHTERA (Small / Semi Automated Slaughterhouse)
Cibarengkok RT 05 / 04 Ds. Pengasinan Kec. Gunung Sindur Kab. Bogor
PT. RAJA JEVA NISI (Small / Semi Automated Slaughterhouse)
Gg. Belibis No. 62 RT 01/07 Kebon Kepi Pengasinan Gunung Sindur Kab. Bogor
Mina Samudra (Small / Semi Automated Slaughterhouse)
Kp Lengis , Ds Warung Menteng, Cijeruk, Kab Bogor
Jambu Raya (Slaughter Point)
Jl Pamoyanan Sari 9 RT 002/01
Cijeruk
Bogor 16740 Jawa Barat
0251-8212873
Page 52 of 66
Telepon Lainnya: (0251) 8211980, 8211950
Fax: (0251) 8212873
CV. BUANA (Small / Semi Automated Slaughterhouse)
Jl. Raya Kemang, Parung Km. 26 Kab. Bogor
CV. DUIKIAN JAYA (Slaughter Point)
Jl. Ds. Cihauk Jl. Sukabakti RT 01/01 Parung Kab. Bogor
PT. PUTERA HASTA KARSA SWADAYA (Slaughter Point)
Jl. H. Nawi No. 42 RT 06/02 Ds. Waru Kec. Parung Kab. Bogor
CV. TRI TUNGGAL SEJAHTERA (Slaughter Point)
Kp. Lebak Wangi No. 54 RT 03/02 Ds. Parung Kec. Parung Kab. Bogor
PT. RAJA JEVA NISI (Slaughter Point)
Gg. Belibis No. 62 RT 01/07 Kebon Kepi Pengasinan Gunung Sindur Kab. Bogor
UD. SEJAHTERA (Slaughter Point)
Cibarengkok RT 05 / 04 Ds. Pengasinan Kec. Gunung Sindur Kab. Bogor
RPA. PAK EDI (Slaughter Point)
Jl. Tapos Kranji Barat no. 25 Cibinong Bogor
Sentra Pemotongan Ayam :
RPA tradisioanal di daerah Pondok Rumput, Kebon Pedes Bogor
NUR CHICKEN (Slaughter Point)
Jl. Manunggal Bakti I No. 34 RT 06/08 Kel. Kebon Pedes Kec. Tanah Sareal, Kota Bogor
PEMOTONGAN AYAM H. Ir. SONY (Slaughter Point)
Jl. Manunggal Bakti I No. 19 RT 06/08 Kel. Kebon Pedes Kec. Tanah Sareal, Kota Bogor
PEMOTONGAN AYAM H. SAIMAN (Slaughter Point)
Kebon Anggrek Lebak RT 04/02 Kel. Kebon Pedes Kec.Tanah Sareal Kota, Bogor
PEMOTONGAN AYAM H. SURATNO (Slaughter Point)
Jl. Manunggal Bakti Jaya No. 4 Kel. Kebon Pedes Kec. Tanah Sareal, Kota Bogor
PEMOTONGAN AYAM KALIJO (Slaughter Point)
Page 53 of 66
Pondok Rumput Gg. Tambak 2 A RT 06/11 Kel. Kebon Pedes Kec. Tanah Sareal, Kota Bogor
PEMOTONGAN AYAM MULYONO (Slaughter Point)
Pondok Rumput RT 0 3/11 Kel. Kebon Pedes Kec. Tanah Sareal, Kota Bogor
PEMOTONGAN AYAM SUTARNO (Slaughter Point)
Jl. Manunggal Jaya No. 9 RT 02/02 Kel. Kebon Pedes Kec.Tanah Sareal, Kota Bogor
PEMOTONGAN AYAM SUYATMI (Slaughter Point)
Jl. Manunggal Bakti I No. 4 3 RT 06/0 8 Kel. Kebon Pedes Kec. Tanah Sareal, Kota Bogor
DEPOK
Komp. Rumah Pemotongan Hewan (RPH) Tapos (Public Governance Slaughterhouse)
Jl. Raya Tapos - Cimanggis-Depok-Jawa Barat
Amindo Mina Sejahtera (Small / Semi Automated Slaughterhouse)
Jl KSU RRI Kampung Serab RT 001/05, Kel Kuala Kencana , Kec Sukmajaya Depok
Bichick PT - Rumah Pemotongan Hewan (Small / Semi Automated Slaughterhouse)
Perumnas Depok II
Jl Flamboyan 10 Perumnas Depok II Tgh
Sukamaju, Sukmajaya
Depok 16415 Jawa Barat
021-7775362
PT Ayam Prima Esa (Small / Semi Automated Slaughterhouse)
alan Pemuda No. - Rt.006/
Kel : Sawangan Baru,
Kec : Sawangan, DEPOK
JAWA BARAT - INDONESIA 16511
Page 54 of 66
TANGERANG
PT. Japfa Santori Indonesia (Automated Slaughterhouse)
Office: Jl Raya Serang Km 20,2. Cikupa - Tangerang.
Tel : +(62-21)-59400610.
Tel : +(62-21)-5961284.
Fax : +(62-21)-5961285.
Fax: +(62-21)-59400613.
PT CITRA GUNA LESTARI (Small / Semi Automated Slaughterhouse)
Jalan Talaga Mas Raya No. 29
Kel Bojong Kec Cikupa, Tangerang 021 59402662
RPA PT Bangkit Setia Sentosa Primatama (BSSP) (Small / Semi Automated Slaughterhouse)
Jalan Bumi Mas Raya No. 5, Kawasan Industri Cikupamas
Kel : Cikupa,
Kec : Cikupa, Tangerang
BANTEN - INDONESIA 15710
+62-21-59403022
PD. Petra Food (Small / Semi Automated Slaughterhouse)
Jalan Raya Serpong Km.7
Komplek Multiguna Blok F19
Serpong – Tangerang
Sawung Prima (Small / Semi Automated Slaughterhouse)
Jl Aria Putera 22 Ciputat
Page 55 of 66
BEKASI
Rumah Pemotongan Unggas “Duta Makmur” (Small / Semi Automated Slaughterhouse)
Jl. Raya Pasar Babelan kec. Babelan – Bekasi 17610
Rumah Potong Unggas Skala Kecil – RPU SK Pusaka Unggas (Small / Semi Automated Slaughterhouse)
ds Segara makmur, Kec. Taruma Jaya, Bekasi
Page 56 of 66
Annex 5. Relevant governmental regulations
No.
Regulation
Types
Rule Number / Subject
Summary
1
Law of the
Republic of
Indonesia
Regulates about food safety, nutrition and quality of food,
income and expenditure of food into and out of the territory
of Indonesia, the responsibility of the food industry, food
security, public participation and oversight,
2
Law of the
Republic of
Indonesia
No. 18 Year 2009 on Animal Among other things regulates the provision of seeds /
Husbandry and Animal Health seedlings / feeder, feed, cultivation, harvest, postharvest,
marketing, and farm product processing industry, control and
prevention of animal diseases, veterinary public health and
animal welfare,
3
Law of the
Republic of
Indonesia
Revision of Law No. 7 of 1996
Scope of regulation include: food planning, food availability,
food accessibility, food consumption and nutrition, food
safety, food labeling an ad, supervision, food information
systems, research and development of food, food
institutions, public participation and investigation
4
Regulation of the Number
Minister of
381/Kpts/OT.140/10/2005 on
Agriculture
Guidelines for Certification of
Veterinary Control Business
Unit Food of Animal Origin
Certificate of veterinary control of animal-based food
business unit is a written certificate as valid proof of the
fulfilment of the requirements of hygiene and sanitation as a
basic feasibility of animal-based food safety assurance
business unit of food of animal origin
5
West Java
Provincial
Regulation
Number 18 of 2008 on Fees Regulation aimed at controlling animal diseases and ensure
the quality of feed circulating in West Java in an attempt to
Animal Disease Testing
Services, Materials of Animal avoid the loss of farmers and communities.
Origin and Quality Feed / Raw
Feed
Also regulated tariff structure and charges
6
West Java
Provincial
Regulation
No. 22 of 2012 on the
Implementation arrangements based livestock and animal
Implementation of Animal
health as:
Husbandry and Animal Health
a. reference in the determination of policy
implementation livestock and animal health;
b. pelaksanaankegiatan guidelines in livestock and
animal health, and
c. guidelines for district / city in establishing local
regulations or policies in the field of animal
husbandry and animal health.
The scope of the implementation of livestock and animal
health, include:
a.
b.
c.
planning;
farm area;
management;
Page 57 of 66
No.
Regulation
Types
Summary
d.
e.
f.
g.
h.
i.
7
animal health;
Veterinary Public Health and animal welfare;
veterinary authority;
empowerment of farmers;
human resource development;
research and development of animal husbandry and
animal health
Local Regulation No. 9 of 2012 on Retribution Retribution is a regional levy as payment for specific services
Bekasi
or special permits provided and / or administered by the local
government for the benefit of a private person or agency.
Slaughterhouse levy user charges levied on the provision of
services at the facilities activities slaughtering cattle
slaughterhouses including animal health inspection service
before and after the cut, provided, owned and / or managed
by the Local Government
Slaughterhouses which are used to cut the animal must meet
the following requirements:
located in an area that does not cause disruption or
environmental pollution, far from residential areas,
near streams or lowest part of the city and is easily
reached by car or near the highway;
• The building complex slaughterhouses have
complete facilities and equipped with adequate
equipment and enough clean water
• complex slaughterhouses must be fenced for
security and avoid external visibility of the cutting
process
• at the slaughterhouse should be employed
someone who has expertise in the field of
veterinary public health
In appendix 7 of this rule, set the structure and amount of
levy rates abattoir.
•
8
Bekasi District
Regulation
Number 6 of 2007 on Fees
These regulations, among others, set things up as follows:
Animal Husbandry, Fisheries
• Cutting Poultry place is a building or place used for
and Marine
the temporary poultry slaughtering activities
• Cutting cattle meat is generating activities consist of
activities: livestock inspection before being cut,
slaughter, slaughter completion, and medical
examination after the cut
• Principles and objectives in the tariff setting
livestock inspection results is to consider the cost of
the organoleptic and laboratory examinations, the
cost of media and chemical Regensi, the cost of
Page 58 of 66
No.
9
Regulation
Types
Bogor Regency
Regulation
No. 29 of 2011 on Business
Services Levy
Summary
inspection / maintenance, servicing and calibration
of equipment and administrative costs.
• Retribution farm is comprised of Animal Health
Inspection Service charges and levies, farm business
license,
In connection with the farm, this rules among other things
the following:
Slaughter House (RPH) is a building or complex of
buildings with designs and certain terms that are
used as a slaughterhouse for general public
consumption.
• Slaughter is an activity that produces meat which
consists of ante mortum, slaughter, slaughter and
completion of post mortum examination.
• Objects Levy Slaughterhouse is the provision of
livestock slaughterhouse facilities including animal
health inspection service before and after the cut,
provided, owned and / or managed by the local
government unless the provision of facilities
livestock slaughterhouses supplied, owned, and / or
managed by state-owned companies, enterprises,
and private parties.
• Tariff structure for Poultry Slaughter House Rp 50, /head
In connection with the farm, this rules among other things
the following:
•
10
Local Regulation Number 5 of 2012 on
Bogor
Business Services Levy
•
•
•
•
•
•
Slaughterhouse hereinafter abbreviated RPH is
owned facilities and Local Government with the
design requirements specified in accordance with
the applicable provisions are used as a place of
slaughtering animals for public consumption.
Investigation and slaughtering levy which is
hereinafter referred to levy fees charged to those
who use its equipment and facilities RPH and
veterinary and meat inspection services.
Ante-mortem inspection is the implementation and
testing before the livestock or cut.
Post mortem examination is the examination and
implementation or testing after the animal
slaughtered.
Animal shelter / animal is accommodating business
activities or livestock animals in the courtyard of the
shelter or enclosure RPH shelter.
Re-examination is the examination of meat and
other ingredients of animal origin coming from
outside of the slaughterhouse and / or have not
been examined from the area of origin.
Page 59 of 66
No.
Regulation
Types
Summary
Spending animals / livestock are activities bring
animals / livestock out of RPH after veterinary
examination.
• Object RPH Levy referred is the provision of
livestock slaughter facilities including animal health
inspection service before and after the cut,
provided, owned and / or managed by the Local
Government
• The level of use of services is measured based on
the type of service and the type and number of
cattle slaughtered
• Tariff structures for inspection and slaughtering
poultry is: where cutting costs Rp 50/head, Rp
25/head ante mortem, post mortem examination Rp
25/head.
This regulation has been improved and refined with the
Regional Regulation No. 5 of 2012 on Business Services Levy
•
11
Local Regulation No. 3 of 2009 on Levy
Bogor
Investigation and
slaughtering
12
Local Regulation Number 22 of 2003 on
Depok
fisheries permits, ranches
and slaughterhouses
In connection with farms and slaughterhouses, these
regulations among others define the following matters:
• Livestock Permits are granted written permission by the
Mayor or other designated official, which gives the
Company the right to carry out cutting Poultry Ranch
house is a building or complex of buildings with designs
and certain terms that are used as a cut of poultry for
general public consumption.
• Cutting Poultry Place is a place / building design and
specific requirements by the competent authorities
designated as a place to cut poultry for public
consumption is limited in a particular district or in the
market with a Maximum capacity of chicken slaughter
of 500 head per day.
• Slaughtering business are the activities carried out by
individuals or legal entities that carry out the slaughter
of poultry in a poultry slaughterhouse / poultry
slaughtering their own or belonging to another party, or
sell poultry cutting services.
• Livestock enterprises can be organized in the form of the
People's Company Ranch or Ranch.
Type of Farming
Corporate Farms Individual Farms
(the minimum
(Number of
number of animals
animals below)
in one plot)
Laying Chicken
Broiler
10,000 breeding
15,000 head / cycle
10,000 breeding
15.000 head /
cycle
Page 60 of 66
No.
Regulation
Types
Summary
• Each organizer farm business, are required to have
business licenses Ranch of Mayor or appointed official.
• Farm business license is given in the form:
a) Permission Ranch Business Principles, Principle
Approval (valid 1 year) given to livestock enterprises
to conduct physical preparation and administration
including related licensing
b) Permits Animal Husbandry; business license granted
to the Company Ranch Ranch that has been ready to
enter production activities, including for livestock.
Permits are valid for Livestock Ranch Company
conducts its business activities in question and shall
re-register every 5 (five) years.
c) Registration Ranch. To conduct farm business,
People Livestock Livestock Registration is required
to have the People of the Mayor or appointed
official. People Livestock Registration Certificate is
valid for the farm business people walking and must
re-register every 5 (five) years. People Ranch
resident registration certificate or equivalent with
Business License Ranch. To get a registration
certificate Ranch, each farm must be incorporated
in the farm.
• According to the type of activities, businesses cutting
animal / poultry consists of four (4) categories:
a) business slaughterhouses / poultry category I, ie
slaughtering business / poultry should be executing
activities slaughterhouses / owned own poultry
slaughterhouse / poultry own;
b) business slaughterhouses / poultry category II, ie
slaughtering business / selling activity in the form of
poultry slaughterhouses services / poultry
slaughtering and implement / poultry belonging to
someone else;
c) business slaughterhouses / poultry category I and II
combined, ie slaughtering business / poultry should
be executing activities slaughterhouses / owned
own poultry slaughterhouse / owned own poultry
slaughtering and selling services / poultry
slaughtering and implement / poultry owned others;
d) business slaughterhouses / poultry category III, ie
slaughtering business / activities carry a poultry
slaughterhouse / abattoir poultry / birds belonging
to another party
•
Any person or entity conducting business Butchering /
Poultry required to obtain a license from the Mayor or
appointed official. Business license as referred to
Page 61 of 66
No.
Regulation
Types
Summary
consists of:
a. Permission principle;
b. Permits Slaughterhouse / Poultry.
13
Local Regulation No. 7 of 2011 on Levy
Depok
Slaughterhouse
Among other regulations governing the amount of levy of
poultry slaughtering services, poultry inspection services and
transport services carcass as follows:
Poultry slaughtering
services
Poultry inspection
services
Carcasses
transportation
services
Distances below 10
KM
Distance 10 s / d 30
KM
Distance above 30 s /
d 60 KM
14
Jakarta Provincial No. 4 of 2007 on Control
Regulation
Maintenance and Poultry
Peradaran
Rp 100/head
Rp 100/head
Rp 2.500/10
head
Rp 7.500/10
head
Rp 10.000/10
head
These regulations, among others, set about the following
things:
• Poultry is the supervisory control over the
maintenance and distribution of birds in order to
prevent Avian Influenza.
• Every person and / or legal entities who keep poultry
food in the Region shall have a permit.
• Every person and / or legal entities who maintain pet
birds and poultry for research, education and
conservation are required to have certification of
animal health and special signs; animal health
certification and special signs referred to is given by the
Department of Animal Husbandry, Fisheries and
Marine.
• Owner shelter and food poultry slaughterhouse that had
existed before the enactment of this area is required to
carry out the transfer of cutting poultry shelters and food
to the location specified by the Regional Governor or out
gradually over a maximum period of 3 (three) years since
the enactment of the Local Rules ;
• Every person and / or legal entities that enter into
regional poultry shall include a document stating the
health of poultry and explain the origin and destination
of dispatch issued by the competent authority or
Page 62 of 66
No.
Regulation
Types
Summary
region of origin of poultry veterinarian
• Control over the maintenance and distribution
arrangements and the impact made by the poultry:
a. Mayor and Regent Administration;
b. Department of Animal Husbandry, Fisheries and
Maritime Affairs;
c. Public Health Service, and
d. Department of Public Protection / Civil Service Police
Unit.
• Society can do direct supervision immediately report
to the board of RT / RW or the Village or the District
Officer Livestock and Fisheries, Health Center and
Officer Livestock and Fishery Sub-Department local
presence if found sick or dead birds infected with the
H5N1 virus indicated that avian influenza can cause
• Foreclosure / retrieval poultry is done in an attempt
to break the chain and prevent the spread of avian
influenza which can lead to death for the sufferer and
should be done immediately without waiting for the
criminal proceedings.
15
Jakarta Governor No. 146 of 2007 on
Regulation
Guidelines for the
Implementation of Regional
Regulation no. 4 of 2007
This regulation is the Regional Implementation Guidelines
Regulation no. 4 of 2007.
It sets forth the Governor include:
• Obligation of the person or entity who has had a permit
raising poultry for food:
a. Cleaning cages and equipment every day
b. Disinfection of cages at least 7 days
c. Always keep the base enclosure in the dry state
d. Cleaning food and drink every day, and vitamins on a
regular basis
e. Cleaning the rest of the food and drink
f. Dispose of waste at waste treatment facilities
g. Vaccination in accordance with the applicable
provisions
h. Apetugas kepad reported if found sick or dead
poultry
i. The number of domestic poultry cage adapted to the
capacity of
j. The new birds came to be separated for 7 days
k. Willing destroyed when the birds are found in the
examination indicated Avian Influenza or Avian
Influenza
Page 63 of 66
No.
Regulation
Types
Summary
• Phasing procedure displacement shelters and / or cutting
poultry food (gradually start out 2007 to 2010)
16
Jakarta Governor No. 147 of 2007 on the
Regulation
Provincial Committee for
Avian Influenza Control and
pandemic preparedness
• Establishment of Provincial Committee for Avian
Influenza Control (Avian Influenza) or referred to in this
regulation aims to accelerate FBPI Komprov pengedalian
Avian Influenza and increased preparedness to confront
pandemic influenza
• Chairman Komprov FBPI is Assistant Public Welfare
• FBPI Komprov task is to implement the control of avian
influenza and pandemic influenza preparedness to
confront
• FBPI Komprov function is:
a.
b.
c.
d.
e.
f.
g.
The preparation mechanism and work program
Determination of strategic steps
Coordinating implementation activities
Control, monitoring and evaluation of
implementation strategies
Settlement of problems arising
Mobilization of community participation
The collection, processing and reporting of data and
information avian influenza control and
preparedness to confront pandemic influenza
• To facilitate the implementation of the tasks and
functions of the Task Force was formed Komprov FBPI
job descriptions of the objects on the terms of the
following tasks:
a.
b.
c.
d.
e.
Control of avian influenza in poultry
Control of Avian Influenza in humans
Facing an influenza pandemic preparedness
Risk communication, education and awareness
raising
Restrictions pandemic epicenter
• In carrying out the duties and functions, Komprov FBPI
coordination and / or cooperation funds, logistics,
personnel, data and information to:
a.
b.
c.
d.
e.
f.
g.
h.
Regional Working Units/ related UKPD
Central Government
Indonesian National Army
Indonesian National Police
National Commission FBPI
Business and industry
Non-governmental organizations
Professional organizations
Page 64 of 66
No.
Regulation
Types
Summary
i.
j.
k.
17
Tangerang
District
Regulation
College
International organizations
An individual
Number 7 of 2009 concerning Purpose of this enactment is to guide the maintenance and
control of poultry diseases Avian Influenza in Tangerang
maintenance and Poultry
region
Disease Control Flu (Avian
Influenza)
• The purpose of this enactment is to:
a.
b.
c.
d.
Prevent the introduction and spread of Avian
Influenza
Ensure that poultry and poultry products are
produced safely, quality and free from Avian
Influenza virus
Preventing the spread of disease Avian Influenza
from animal to animal or from human to human
Controlling Avian Influenza in humans with proper
management of human cases
• Maintenance and distribution of poultry
a.
b.
c.
d.
e.
f.
g.
Any person conducting business with commercial
poultry (chickens laying population ≥ 10 000 heads
or broiler farms with a population of ≥ 15 000 head
/ cycle) must have a permit issued by the Regents on
the terms of a recommendation from the
Prohibited established businesses raising poultry for
commercial purposes in a residential neighborhood /
settlement
Poultry raised for commercial purposes, the business
side, the interests of research, education and
conservation must have a Certificate of Animal
Health (SKKH)
SKKH is written evidence issued by authorized
veterinarian, stating that the animal has met the
requirements of safety, health, and based on the
results of clinical examination or laboratory testing
and is valid for a certain period.
Veterinary Certificate is a certificate issued by a
competent veterinarian stating that the animal
product meets the requirements
Any person who shall enter the area to complement
poultry and recommendation SKKH expenditure of
region of origin
Any person who imports of poultry products from all
regions are required to complete the Veterinary
Certificate and recommendation expenditure of
region of origin
Page 65 of 66
No.
Regulation
Types
Summary
h.
i.
j.
k.
Every person who issued poultry must complete
SKKH and expenditure recommendations of the
Department of
Every person who issued the original poultry
products are required to complete the Veterinary
Certificate and recommendations of the
Department-related
Birds that are sold must come from farms that are
not being affected by or at least 30 days there was
no incidence of Avian Influenza and accompanied by
SKKH
Origin of poultry products sold must come from
farms that are not being affected by or at least 30
days there was no incidence of Avian Influenza and
accompanied by a Certificate of Veterinary
• Control of Avian Influenza includes prevention of Avian
Influenza disease, eradication of avian influenza in
poultry diseases, prevention and control of Avian
Influenza in humans.
• Precautions include:
a.
b.
c.
Everyone should report any cases of suspected fraud
or Avian Influenza outbreak or spread of the Office
Any person utilizing poultry and poultry products
from strict biosecurity must perform at a place
where poultry and poultry products from being
Everyone has to sell and cut healthy birds
• Eradication actions, among others:
a.
b.
Combating Avian Influenza is done through
depopulation and disposal in accordance with
applicable regulations
In the implementation of the eradication of the
disease, people can carry out the monitoring officer
Page 66 of 66

Socio-economic analysis of the slaughtering systems in the poultry

Transcription

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