Cattle imports, new farm, to double Greenfields raw milk supply in Indonesia

Photo: Greenfields Fresh Milk on the shelves of a supermarket in Jakarta in April 2017. Kadek Bonit Permadi/Shutterstock

JAKARTA –PT Greenfields Indonesia last month completed the country’s largest import of dairy heifers in one shipment by a private company as it intensifies efforts to double its raw milk supply, Heru Prabowo, its head of dairy farm told Salaam Gateway.

Greenfields Indonesia is run by AustAsia Food Pte Ltd, a subsidiary of Singapore Stock Exchange-listed Japfa. It aims to more than double the company’s milk production in Indonesia with 9,000 imported dairy cows and a second farm that opened in May this year.

“The 2,150 new heifers are the first batch out of a total of 9,000 cows to arrive over the coming months,” Jan Vistisen, AustAsia head of marketing and sales, Southeast Asia, told Salaam Gateway.

The cows it imported from Australia are currently under quarantine at the company’s new $45 million 175-hectare farm in Blitar, East Java.

“Once they are being milked at Greenfields the cows will be able to produce up to 33 litres per cow per day,” said Vistisen.

“By the time Greenfields’ second farm is fully operational in 2018, we will able to increase our contribution of the national dairy production to more than 10 percent, thus reducing the country’s reliance of imported dairy commodities,” he added.

Indonesia’s domestic supply of raw milk met only around 22.34 percent, or 852,000 tons, of the total national milk consumption of 3.8 million tons in 2016, according to data from the ministry of agriculture.

President Joko Widodo’s government aims to increase domestic milk production to 41 percent of national industrial demand by 2021.

To push local production the government issued new regulations in July this year requiring private sector companies to improve the dairy industry through partnering and empowering small farms.

Greenfields Indonesia’s vertically integrated dairy business plans to establish a dairy institute to raise the skill levels of young dairy farmers to improve the quality of milk production, Prabowo told Salaam Gateway.

“Through this program, over the next 10 years skills of more than 5,000 young dairy farmers will be developed to increase local farm productivity and income,” said Prabowo.  

Dairy farming is a strategic industry for Indonesia for its ability to supply daily nutrition to Indonesia’s younger generation as well as contribute to the local beef supply.  

Greenfields Indonesia produces around 42 million litres of fresh milk per year. 75 percent is supplied to the domestic market and the rest is exported to neighbouring countries including Cambodia, Hong Kong, Malaysia, Myanmar, Philippines and Singapore.

Its first farm in Malang is 50 hectares big and houses around 8,600 heads of dairy cattle.

Dairy accounted for $284.9 million of Japfa’s total $3.03 billion revenue and $51.4 million of its $216.6 million operating profit in 2016. Japfa’s other businesses include poultry feed manufacturing, breeding and commercial farming, and consumer foods. Outside of Indonesia it operates production facilities in China, India, Myanmar and Vietnam.

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