Introduction
This short paper reflects various discussions on the root causes of agricultural problems in Indonesia and in West Java in particular. One of the most frequently discussed root causes is the peasant farmer (defined as a farmer with less than 0.5 ha of land) who, in practice, is unable to accumulate profits from the farming process to expand agricultural production. The point of this paper is that while we focus on improving the ‘champion farmers’ (medium and large-scale farmers who are rational economic actors in the agricultural sector) through various infrastructure, programs and policy support, we also need to pay attention to strategies to improve the welfare, capacity and empowerment of the smallholders (social actors in rural areas) in West Java. This paper does not intend to provide a comprehensive view of agriculture in West Java, but hopefully it can provide additional perspectives from the author’s study experiences and interactions with smallholders and lessons learned from several other studies.
Portrait of West Java’s Smallholder Farmers: Agriculture Census data
The 2013 Agricultural Census data provides the most up-to-date and reliable picture of farmers in Indonesia. The Agricultural Census conducted every 10 years is currently probably the most reliable data to provide a picture of smallholders. Based on the 2013 SP, the number of farmers with a land area below 0.5 ha in Indonesia reached 14.6 million households or 55.9 percent of total farming households, while those with a land area below 0.1 ha reached 4.3 million (16%). In West Java, the situation is even worse, as out of a total of 3.04 million land-using agricultural households, 2.29 million (75 percent) are smallholders. This is down from the 2003 census where there were 4.2 million land-using agricultural households and of these, 3.04 million (72%) were smallholders. From these data, the majority of farming households are engaged in the agricultural subsectors of food crops (paddy rice in particular) and horticulture.
Geographically (Figure 1), these smallholders are spread mainly in the central and southern regions of West Java. In proportion, the percentage of smallholders in each district/city ranges from 53-56% (in the districts of Karawang, Bekasi and Indramayu, as well as the coastal area in general) to 94% (particularly in the areas of Bogor city, Cirebon city, Bekasi city and Cimahi city). This explains the increasing pressure on agricultural land tenure with urbanization and urban expansion for settlements and industry in the region. However, it should be understood that the concept of ‘peasant’ is relative based on commodity characteristics and agricultural infrastructure, so that a minimum area of 0.5 ha in one region/commodity may be better than 0.5 ha in another region/commodity.
Speaking of changing trends, the census shows that the number of smallholders is actually decreasing and average land tenure is increasing. A comparison of 2003 and 2013 census data shows that the average land tenure per farming household increased from 0.35 Ha/farmer household to 0.86 Ha/farmer household. The number of farmers with land tenure of less than 0.1 Ha in West Java Province decreased dramatically from 1.9 million households in 2003 to just 0.69 million in 2013 (a decrease of 63%). In fact, the overall decline in the number of farming households in West Java was only 29%.
What does this mean? There are two possibilities: (1) that farmers are becoming more prosperous with increased land tenure, or (2) that smallholders are losing their status as landowning farmers due to ownership transfer or land conversion to non-agricultural use.
Let’s look at other data: there has been an increase in the number of farming households with a land area of more than 0.5 Ha, with the highest increase occurring in the land area class of more than 3 Ha (a 15% increase in the number of farming households). When this data is compared with the 1993 and 2003 agricultural census comparisons, the second conclusion makes more sense. In the 1993-2003 census comparison, the number of smallholder farmer households (land size <0.5 Ha) increased from 45.3% to 56.4%. This means that in the last 20+ years, smallholders’ land holdings have been getting smaller and smaller until they had to release their land to other farmers or for other uses.
The next question is, can smallholders with less than 0.5 hectares of land still prosper? As stated earlier, the answer is relative depending on the type of commodity being developed. Nevertheless, with the majority of farming households in West Java being in the agriculture and food subsector, we can look at a study conducted by Susilowati and Maulana (2012) which shows that the minimum land area for farmers to earn an income equal to or higher than the BPS poverty threshold is 0.65 Ha for rice, 1.12 Ha for corn and 0.74 Ha for soybeans. Furthermore, Susilowati and Maulana also calculated that to reach the Break Even Point (BEP) of farming, the minimum area is 0.51 Ha for rice, 0.41 Ha for corn and 0.46 Ha for soybean. Based on this study, it is certain that more than 2 million farming households in West Java are trapped in poverty. The latest data from BPS also shows that the average Farmer Exchange Rate for food crops (the ratio between the price index received by farmers and the price index spent by farmers for production and living needs) is 99.12[1], with values below 100 from January to August 2017 and above 100 from September to December 2017. Imagine that these 2 million farmers are responsible for providing around 3 million tons of rice (in GKG; assuming productivity of 4 tons/Ha/harvest) annually to the people of West Java, whose needs reach more than 6 million tons of rice[2] (in GKG), or 30% of the rice needs in West Java (BPS, 2017).
A closer look at smallholders
The data above shows that smallholders are in a difficult economic condition. This is exacerbated by their low age range and education level, which makes it difficult for smallholders to accept agricultural innovations and manage agricultural economic institutions. On the other hand, economies of scale that are too small are often seen as an obstacle for smallholders to achieve production efficiency. This underlies the pessimism of many parties (academics, government, business actors) in channeling assistance to smallholders. Through several in-depth studies conducted by the AKATIGA Center for Social Analysis during 2013-2015 (in a series of scientific articles edited by Prof. Ben White, 2015) as well as studies conducted by the author (Dwiartama, 2014; Dwiartama et al., 2016), there are at least several assumptions that need to be straightened out about the above view.
The first point relates to income. While smallholders earn very little from their farming businesses, the Agricultural Census data also shows that agriculture is not the only source of income for farmers. In fact, income from farming is on average only 41.7% of the total average farmer income (47% if counting income as agricultural labor on other land). The contribution of agricultural businesses to farmers is highest among farmers in Cirebon, Indramayu and Karawang districts (52%, 58% and 51% respectively), while it is quite low in the municipalities (reaching 30%). This suggests that regardless of the productivity provided from their farming businesses, these farmers have the adaptability to anticipate their living needs. The AKATIGA study (Nugraha & Herawati, 2015) showed a variety of sources of income for farmers in several villages in Karawang and Indramayu, including non-farming (mushrooming, livestock, secondary crops), non-farming (construction workers, craftsmen, home industries), out-of-area income (factory workers) and overseas income (migrant workers).
The second point is related to access. The Agricultural Census looks at smallholders based on their land ownership. In fact, there is a difference between access and rights (ownership). Access talks about how much farmers can benefit from the land they manage, regardless of whether the land is theirs or not. In the study conducted by AKATIGA, the relationship between smallholders, farm laborers and medium/large farmers can be very dynamic. In some places, sharecroppers can have flexibility in implementing agricultural innovations through a profit-sharing system, while in other places the owner-cropper pattern is rigid enough to limit the income that can be earned by sharecroppers. Studies conducted by James Scott in the 1970s (Scott, 1976) showed that there is a strong social relationship (patron-client) between middle farmers and smallholders, where middle/large farmers act as a buffer when smallholders experience economic problems and crop failure. Although this relationship is commonly seen as unhealthy, it must be recognized that it is also the savior of smallholders and the entry point for many agricultural innovations brought by the government (White & Wiradi, 1989).
The third issue is related to social efficiency and productivity. The AKATIGA study conducted in several villages in Indramayu and Karawang (Wati & Chazali, 2015) also shows that land size, while clearly related to production, is not always linearly related to productivity. In their study, which was corroborated by a broader data analysis, the productivity of paddy rice was highest among farmers with cultivated land of <0.5 Ha, followed by farmers with cultivated land of more than 2 Ha. This relationship is reversed for farmers with land between 0.5 – 2 Ha. In addition, social efficiency is also high among smallholder farmers. Social efficiency is defined as how much agricultural practices support increased production, maximize employment and livelihood provision, and support better income distribution. In this regard, some forms of local wisdom, traditional farmer profit-sharing systems, village granary systems and appropriate technologies, as practiced by many smallholders today, are able to keep social efficiency high, while new technologies that lead to economic efficiency (such as combine harvesters or tractors) actually reduce social efficiency (eliminating employment), and in some cases are not used efficiently (control by elite farmers only).
Proposed Programs for Champion (Peasant) Farmers
In many studies and interviews, the ideal solution to the problem of smallholder farmers is agrarian reform. However, in the situation of West Java in particular, agrarian reform is a challenge because the issues are too complex. On this basis, this paper proposes several other program ideas (whatever that means) that are possible to implement (partly also inspired by the AKATIGA study [Sadoko, 2015]), with the following explanation:
- Provide direct subsidies to smallholders/farm laborers in forms such as Health/Employment Insurance, Education Insurance, and Direct Cash Assistance/Food Stamps regardless of land ownership. Smallholders can still live stably through their agricultural and non-agricultural activities, as long as there are no drastic shocks to their livelihoods (e.g. crop failures, accidents, education costs, etc.). In James Scott’s perspective, smallholders are like people standing by the sea with the water level below their noses – high waves will easily drown them. Health, accident, education and basic needs insurance can help smallholders weather such shocks.
- Allocate village-owned collective land that can be managed by smallholders and farmer youth. Smallholders need access to land that does not burden them. On the other hand, farmer children and village youth also need space to innovate and learn to farm. A study conducted by AKATIGA (2016) in Kulonprogo showed that village-owned land utilized by Karang Taruna can increase the enthusiasm of village youth to return to farming. Another study conducted by the authors (Dwiartama & Suheri, 2016) in Bandung Regency also showed that collective land can be a pilot space for the application of new innovations in the agricultural sector. Indigenous communities in Kasepuhan Ciptagelar also provide examples of how collective land can ensure consistent and sufficient food supply (Dwiartama et al., 2016).
- Provide appropriate technology that suits the relationship patterns of rural smallholders through multi-stakeholder cooperation. Appropriate technologies and efficient farming methods need to be developed according to the characteristics, behaviors and existing relationship patterns among rural smallholders. These technologies should be bottom-up, and not top-down. The private sector and civil society organizations, including academia, can be the drivers of this. From a study conducted by the author (Dwiartama 2014) in Subang, several smallholder farmers who are members of farmer groups were able to farm more efficiently with the help of innovations from universities or community organizations (e.g. soil-restoring bacteria, growth stimulants, simple grinders, etc.).
- Strengthen village capacity (through the 2014 Village Law) to safeguard agricultural lands from conversion and excessive aggregation of ownership. Villages have the capacity (and financial resources) to maintain orderly land use, although on the other hand village personnel can also be a source of problems from high land use change, as happened in the coastal areas (Dwiartama study, 2014). The West Java government’s program for village development needs to involve village officials in ensuring that agricultural land is maintained and accessible to small farmers and farm workers.
[1] In simple terms, BPS defines that a Farmer Exchange Rate above 100 means that farmers experience a surplus (the increase in production prices is greater than the increase in consumption prices and production costs), equal to 100 means break-even, and below 100 means a deficit.
[2] Calculated from BPS figures of per capita rice consumption of 0.23 kg/capita/day, milling yield figures for West Java of 65.60% and the population of West Java of 46 million in 2015.
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