Livestock and Poultry Industry in Indonesia: Policy, Potential and Problems

Abstract

This paper focuses on the production and demand potential of livestock and poultry
products as related to development policies to meet the dynamic change of production structure, scale, commodity programs and improvement of farmer's
welfare especially to alleviate poverty. By means of intensive survey on available secondary data and information analyses and interpretation were conducted. Indonesian animal production system is characterized by 3 major agro—ecological systems e.g. wet, dry and semiarid zones and 2 economic sectors e.g. traditional and modern. In terms of gross domestic product (GDP) during the first 25 year
economic development, the contribution of the animal subsector declined from 2.25 % to 2.11%, but within the agricultural sector it grew from 6.00% to 11.30%. During the same period, meat, egg and milk production grew at the rate of 6.06%,
11.92% and 12.18% per year respectively. Interms of farmer's income animal production contributes up 60% especially in dry and semiarid zones. However,
the rapid production is offset by high growth of demand due to human population increase, improved purchasing ability and high demand elasticity to income change. The problems in animal production aspect in the tropical country such as lndonesia, is low productivity and some socio-econominic issues such as low investment capability, low technology adoption, laud size and tenure system, market structure and infrastructure which affect price. This complex of problems known as (skill-land-technology-feed-animal-market) complex varies in its intensity between traditional and modem sector animal industries. The above dynamic changes in production and trade, enhance new prospects for production to meet the strong domestic demand and at the same time to meet global requirements. The govemnient has played and important role and backed up by private, BUMN (government owned enterprise) and cooperative sectors to develop strategy on partnership between traditional and modern sector, technology, infrastructure,
environmental improvement and farmer's group or institutional establishment. The concept of agri bussiness becomes the pillar to promote animal production and Fanncr's welfare.