SSmallholder Teak Agroforestry SystemsWebinar ar ––Agroforestry in the Tropics course Webinaar groforestry in the Tropics course AgATechnische Universität Dresden, 9 July 2019

James M. Roshetkoko, o, Leader er Treesess, Agroforestry Management and d Marketsts Unit, James M. Roshetkkoo, eadeLeL r TrWorld Agroforestry Centre (ICRAF),

s Agrofore, AsreeTr es), )) Southeast

estry Management andd MarketMforestst Asia Research Program, Bogor,

s Unit, Ukettsr, r Indonesia

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Outline1. Background – Teak and Smallholder Teak2. Teak in Indonesia3. Smallholders – a Source of Industrial Teak4. Smallholder Systems and Management5. Finance, Economics, and Markets 6. Environmental Restoration 7. Challenges of Smallholder Teak Systems8. Recommendations for Management & Markets9. References …. other reading

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1. Teak -Tectona grandisBest-known, most valuable,

widely produced tropical timberNative: India, Myanmar, Laos, Thailand 23 million ha (half in Myanmar)

Timber demand has always been great

Plantation production: Indonesia – 13th century?? Sri Lanka – 1680 India – 1840sMyanmar – 1856

Currently grown in minimum 70 countriesGlobal teak plantation 7 to 4 million ha 83% in Asia – India, Indonesia, Myanmar

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Plantation production: Indonesia – 13th century?? Sri Lanka – 1680 India – 1840sMyanmar – 1856

Currently grown in minimum 70 countriesGlobal teak plantation 7 to 4 million ha 83% in Asia – India, Indonesia, Myanmar

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1. Smallholder Teak When and how did smallholder farmers start to be involved with teak?

rural people worked as laborers for plantation establishment and management

Taungya system: intercropping with annual crops to improve teak seedling establishment and growth (off-set establishment costs) and increase involvement and benefit to farmers!

started in Myanmar 1850s approach, and modifications, still promoted

Smallholder teak plantings (plantations) well established in Java (Indonesia) in 1960s Other countries: Laos, Thailand, Bangladesh,

India, the Philippines, the Solomon Island, Nigeria, Togo, Benin, …

the Solomon Island,, … Costa Rica, Panama

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1. Smallholder TeakSmallholder teak plantings Important part of global teak estate

19% of are in Asia and Africa 31% in Central America 34% in South America

Kollert and Cherubini, 2012

Smallholder area approximately ….- 920,000 ha- roughly 21% of total

Smallholder teak systemsIntegrated or segregated Start as monoculture become mixedprefer mixed with other crops & treesVaries from 0.5 – 2.0 haSubsistent systems …… for or commercial Subsistent syproduction!

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1. Teak … beyond timber… other contributions to rural people

fuelwoodoil extracts (leaves & wood) skin medicine leaves used as compress for wounds dyes (buds and leaves) for clothes dried leaves as dry season feed for sheep

and goats (low concentrations, 5-25%) dried leaves for roof thatch bark, leaves, wood pulp, sawdust used in

industry …. collected by rural people?mushrooms grow on teak wood teak caterpillar … eaten or sold

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2. Teak in Java (Indonesia)

Introduced to Java 2nd Century (by Hindu missionaries)Teak ship building in Java - 10th century Teak plantations started - 13th century Dutch esta. intensive plantations - 19th century Perum Perhutani (state forestry industry) - 1963 Smallholder teak plantation common - 1960s

Source: Simatupang (2000); White (1991); Whitten et al (1996).

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2. Smallholder Teak areas - Indonesia

*

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3. Farmers – main source of industrial teak

Teak cubic m3 2006 2007 2009Perhutani (State Forest Com.) 184,521 186,613 171,329Smallholders 248,111 201,453 200,793

~1.5 million farm families grow teak on Java (Nawir et al 2007)1.5 million farm families row tegr~444,000 ha of mixed teak on fallowed ag land (Java, degraded)444,000 ha of mixed teak on fa~3.1 million ha farmland teak in Indonesia (Kollert et al 2012)3.1 million ha farmland 80% teak used by SMEs from farms (dbh <30) (Achidiawan et al 2011)80% teak used bSMEs are 90% of Jepara furniture industry (Yovi et al 2013)

Teak log production Central Java (one of the two main teak producing provinces)

Smallholder have become an dominant source of teak

supply of smallholder teak will ll as plantation continue to o 9

Why do farmers plant teak?- 54% as family savings (teak is a living bank account)- harvest for $ needed - tebang butuh- 23% as cultural heritage -

23% as cultural heritage - only 15% to max econ opportunity

Prefer Mixed Systems :↓ risk; ↑ diverse crops, product & income for home; improve environ.; sustain traditional

Farmers want to improve Farmers want tomanagement: ….but not sure what to do!

4. Socioeconomics & Culture

Indonesia

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Teak system % of systems Size (ha) Trees/ha Tree speciesTegalan (intercropping)Pekarangan (homegarden)Kitren (woodlot) Line plantings (agric. land)

75%

15%10%

Species UseTimber

Fodder / Greenmanure

Others

55.9%

11.3%

7.4%

5.8%

4.0%

2.4%

1.4%

1.2%

1.1%

0.9%0.8%

0.7%0.5%

0.1%

6.5%

Species Teak

Mahogany

Leucaena

Acacia

Bauhinia

Gliriidia

Gnetum

Sesbania

Cassia

Coconut

Manggo

Cashew

Dalbergia

Jatropha

Others

Ave. family holding 1 ha (0.5-3 ha)30-50% under teak …. - 10% kitren - remainder mixed systems

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4. Smallholders Southeast Asia Thailand & Laos

Also mixed tree-crop preferred..enable off-farm opportunitiesinclude temporary migration

Dry areas (Benin, Togo, Nigeria)Teak competes with crops (land and labor) …diversify, restoration preferred

Central & South AmericaSmallholder monocultures

All locations farmers need support All –

locations farmers need support All –– land, tech. & market knowledge and, tech. & mlaand assistance

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4. Intercropping (Indonesia) 82% farmers intercrop42% land parcels cropped/year69% intercropped land - tegalan 11% kitren intercropped (mainly during establishment)73% of farmers fertilizer/weed, but only with intercroppingCrops: cassava, peanuts, rice, soybeans, corn, kidney beans, bananas, other vegetables. g, g,

Kacang Tanah 24%

Kacang Kedelai 8%

Kacang Panjang 3%Singkong

27%

Padi 18%

Lainnya 20%

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4. Farmer SilvicultureRegeneration: 72% wildlings, 30% local seedling, 20% coppice, 12% improved germ.Pruning: 65% farms, 55% trees – for fuelwood, 10-15 cm stubThinning: 57% thinning (but really harvesting)Coppice: no thinning Not management for improving production /growth

Poor silviculture practices! → Farmers teak systems … overstock, slow growing, low quality, low productivity

Remember – harvest for needs!14

4. Farmer Demo Trials (FDTs)

6 Locations Trees 5-6 years old FDT Treatments- Thinning: i) control, ii) maximum 40-45% (target 4x4m – 625 trees/ha)- Pruning: i) control; ii) 50% total height; & iii) 60% total height- Singling: i) control; & ii) ‘singling’ Monitoring every 6 months

Results (+ 2 yrs) Rainy season growth increment ↑ thinning & pruning, dry season not Pruning 60%-Thinning: DBH 60% ↑, height 124% ↑Single Treatment: Thinning versus No Thinning: DBH 45% ↑, height 80% ↑Good results - Challenging On-Farm conditions

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5. Economics & Financefarmer limited capital and household labordeploy those resource with emphasis on short-term productionteak not prioritized for investmentself-source germplasm …intercropping → fert, weeding, etc

3.0%

11.6%

24.9%

60.5%

0%

10%

20%

30%

40%

50%

60%

70%

Timber, otherthan teak

Teak Food crops andlivestock

Off-farm work,remittance, retail

This approach reasonable ...Cash invest is marginally profitable (if solely on teak)Teak contribute – 12% household income…but teak system contribute– 40% of hh income →→

…good return on minimal investment!!

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…good return on minimal investment!!

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5. Teak Germplasm Huge demand for Teak Seed & Seedlings

East and Central Java farmers - Rp 28,000-35,000/day (US$ 3.30-4.10)

collect/process seed- Rp 275,000-795,000/year (US$ 32-94) - 33-66% of income during 3-month season- appro. 22,500 farmers involved - teak is 20% of seed collected

Similar stories Lampung: 24% of farmer nurseries (100%

of farm timber nurseries) sell teak seedlingsCosta Rica: farmers make significant

income from selling teak (& other priority species) to organizations & projects (Cornelius et al. 2010) 17

5. Market/Marketing

Age(years)

DBH(cm)

Price for farmer(US$/standing tree)

Log volume after processing (m3)

Log price totraders (US$)

role of farmer limited to producerstanding tree standard unit of sale for farm-grown teakno clear quality or volume standards exist 51% farmers discuss price with neighbors, 31% compare price

with multiple traders, 18% are price takers regardless of approach – farmers receive price ↓ market ratetraders ↑ transaction cost; so offer price ↓ traders ↑ transaction cost; so offer price ↓ farmers sell small dbh logs (only 14% harvest by dbh class)

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5. Ideal - Smallholder Teak Marketing

Awareness BuildinggMarketing, not just selling

Understanding of market demand … through process of build long-term relationshipsg p

Collective marketingTeak growers work together to build relationships with market and reduce transaction costsOptions: cooperatives, associations, farmer groupsCollaboration with teak processing industry

5. Reality is different ….Farmer Reluctances …

Proof of ↑ profits through collective marketing, yes … but management of cooperative / association … poorDifferent resources for each household

Trees of different agesHousehold/farm characteristics …

Different needs for each householdTuition fees, marriage, emergencies ….Not the first source of income ….Working with neighbors … not always easy

Results – traders still face high transaction costs, extra-legal fees, …. pay below market values

6. Environmental ImpactsRehabilitation of Central Java & Yogyakarta

used to rehabilitates fallow agriculture land… 11th century 1.5 million ha lowalnds Java 1950’s severe poverty & land degradation treeless, soil erosion, agric. failing drought induced famines ‘Agroforestation’ with teak

- rehab soils, landscapes, incomes, - major source of timber - from treeless to 28.1% tree cover - 68% smallholder farms; teak 56% of trees

Similar cases Laos (Midgley et al 2007) Nigeria (Osemeobo 1989)

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7. Challenges Impediments to smallholder teak

Low quality timber - poor silviculture Dense spacing Lack of capital to invest in teak *(won’t borrow; banks won’t lend for teak) Inability to wait duration of a teak

rotation before needing returns Limited access to market info/linkages Poor bargaining positionHigh transaction costs for traders

passed on to farmers)Unfavourable policies

* But farmers’ opportunistic management provides good returns to limited resources & investment. Minimize risk. Off-farm opport. may be better than intensive silviculture. 22

8. ManagementRecommendations

Harvest for need approach is ok, but…

Farmer should d ↑ ↑ ↑ management, how?- better germplasm - wider initial spacing - coppice management - thinning best option for ↑ production

Government and support agencies facilitate adoption of silvicultural - access to germplasm, extension and

training, information (manuals, bulletins), and demonstration trials

Similar recommendations: Thailand, Laos, Panama, Costa Rica, & general

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Produce larger diameter, better quality logs (know the market)Improve market position by accessing informationDevelop links between teak farmers and teak industries Engage in group marketing to ↓ transaction costs for all partiesProvide farmers log grading and pricing system that is used by the timber industryGovernment provide more suitable timber trade regulations, specifically for smallholder timberSimplify timber trade regulations to - min. transaction costs) & make farm teak markets more efficient

8. Market

Produce larger diameter better

Recommendations

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9. References

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1. Achdiawan R, Puntodewo A (2011) Livelihood of furniture producers in Jepara. Unpublished project report: Mahogany and teak furniture: action research to improve value chain efficiency and enhance livelihoods (FST/2007/119). Australian Centre for International Agricultural Research, Canberra

2. Cornelius JP, F Mesén, ST Ohashi, N Leão, CE Silva, LJ Ugarte-Guerra, KE Wightman. 2010. Smallholder production of agroforestry germplasm: experiences and lessons from Brazil, Costa Rica, Mexico and Peru. Forests, Trees and Livelihoods 19(3): 201–216.

3. Kollert W, Cherubini L (2012) Teak resources and market assessment 2010 (Tectona grandis Linn. F.). Food and Agriculture Organization, Rome

4. Midgley S, Blyth M, Mounlamai K, Midgley D, Brown A (2007) Towards improving profitability of teak in integrated smallholder farming systems in northern Laos. ACIAR Technical Reports 64. Australian Centre for International Agricultural Research, Canberra .

5. Nawir AA, Murniati, L Rumboko. 2007. Past and present policies and programmes affecting forest and land rehabilitation initiatives. In: Nawir AA, Murniati, L Rumboko, eds. Forest rehabilitation in Indonesia: Where to after more than three decades? Center for International Forestry Research, Bogor, Indonesia.

6. Osemeobo GJ. 1989. An impact and performance evaluation of smallholder participation in tree planting, Nigeria. Agricultural Systems 29(2): 117–138.

7. Simatupang MH (2000) Some notes on the origin and establishment of teak forest (Tectona grandis L.F.) in Java, Indonesia. In: Proceedings of the Third Regional Seminar on Teak: potential and opportunities in marketing and trade of plantation teak: challenges for the new millennium. Yogyakarta, Indonesia, 31 July–4 August

8. White KJ. 1991. Teak - some aspects of research and development. FAO Regional Office for Asia and Pacific (RAPA), Publication 1991/17, 53 p

9. Whitten T, Soeriaatmadja RE, and Afiff SA. 1996. The ecology of Java and Bali. The Ecology of Indonesia Series. volume II. Periplus Editions, (HK) Ltd. xxiii + 969 pp. ISBN 962-593-072-8.

10. Yovi EY, Nurrochmat DR, Sidiq M. 2013. Domestic market of Jepara’s small scale wooden furniture industries: its potential and barrier. Unpublished project report: Mahogany and teak furniture: action research to improve value chain efficiency and enhance livelihoods (FST/2007/119). Australian Centre for International Agricultural Research, Canberra.

9. Related Literature

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1. Rohadi D, Roshetko JM, Perdana A, Blyth M, Nuryartono N, Kusumowardani N, Pramono AA, Widyani N, Fauzi A, Sasono J, Sumardamto P, Manalu P (2012) Improving economic outcomes for smallholders growing teak in agroforestry systems in Indonesia. Australian Centre for International Agricultural Research, Canberra

2. Roshetko JM and Perdana A. 2017. The Significance of Planted Teak for Smallholder Farmers. P 66-70. In: Kolbert W and Kleine M (eds), The Global Teak Study, Analysis, Evaluation and Future Potential of Teak Resources. IUFRO World Series Volume 36. Vienna. 108 p.

3. Roshetko JM, D Rohadi, A Perdana, G Sabastian, N Nuryartono, AA Pramono, N Widyani, P Manalu, MA Fauzi, P Sumardamto, N Kusumowardhani. 2013. Teak agroforestry systems for livelihood enhancement, industrial timber production, and environmental rehabilitation. Forests, Trees, and Livelihoods 22 (4): 241-256 DOI: 10.1080/14728028.2013.855150

4. Roshetko JM, DJ Snelder, RD Lasco, and M van Noordwijk. 2008a. Future Challenge: A Paradigm Shift in the Forestry Sector. In: DJ Snelder and R Lasco (eds). Smallholder Tree Growing for Rural Development and Environmental Services. P 453-485.

5. Roshetko, JM, Sabastian GE, Perdana, A, Martini E, Ekawati D, Fauzi MA. 2019 or 2020. Smallholder Teak Systems: Indigenous Innovations in Improving Fallow Management. In: Farmer Innovations and Best Practices by Shifting Cultivators in Asia-Pacific (in review).

6. Sabastian G, Kanowski P, Race D, Williams E, Roshetko J (2012) The influence of the household and farm attributes on adoption of smallholder timber production systems in the Gunungkidul region, Indonesia. In: Meyer SR (ed) IUFRO Small-Scale Forestry Conference 2012: Science for Solutions. University of Massachusetts, Amherst, USA, 24–27 September, pp 176–181

7. Perdana A, Roshetko JM, Kurniawan I (2012) Forces of competition: smallholding teak producers in Indonesia. International Forestry Review: 14(2):238–248.

8. Perdana, A. and Roshetko, JM. 2015. Survival strategy: traders of smallholder teak in Indonesia, International Forestry Review 17 (4): 461-468.

9. Pramono AA, Fauzi MA, Widyani N, Heriansyah I, Roshetko JM (2011) Management of community teak forests: a field manual for farmers. Center for International Forestry Research, World Agroforestry Centre (ICRAF) Southeast Asia Regional Program, Forestry Research and Development Agency, Bogor, Indonesia.

Thank you!

Terima kasih!

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