PT NESTLÉ INDONESIA Wisma Nestlé lantai 5 Perkantoran Hijau ArkadiaJl. Letjend. TB Simatupang Kav. 88Jakarta 12520

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1Spotlight

JULY 2014 ISSUE 04

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TWENTY YEARS AGO, Nestlé Indonesia established Agriservice Coffee Team to provide trainings for Lampung coffee farmers on how to improve coffee qua-lity and productivity, an effort to sup-porting the sustainable coffee farming. Beside trainings, Nestlé Indonesia also initiated the establishment of joint en-terprise groups for coffee farmers (KUB) to empower partnership and coffee beans marketing in order to earn sus-tainable income for coffee farmers.

Located in the village of Ngarip, Tang-gamus, Agriservice Coffee Team started with post-harvest practices training so the produced coffee beans can meet the criteria, known as the “Nestlé Stan-dard and set up the first joint enterprise group for coffee farmers in Ngarip. Having established the KUB, coffee farmers can directly deliver the beans to Nestlé Indonesia factory in Panjang. This KUB has now become one of Pan-jang Factory partners and the hub of coffee farmers’ delivery to factory.

Furthermore, Agriservice Coffee Team also provided trainings for cof-fee farmers on how to apply good ag-ricultural practices. The coffee farmers were keen to participate, even Rohadi, the village head of Ngarip, fully sup-ported these activities. This hard work is now showing good results, evident from the increased in productivity up to

1,200 kg/ha, 50 percent higher than the average national coffee productivity. In 1996, Agriservice Coffee Team set up its demonstration farm in Ngarip for multi-location test of five coffee clones which were developed by In-donesian Coffee and Cocoa Research Institute (ICCRI) and Nestlé Research Center in Tours, France. In 2014, Nestlé Indonesia set up a new 4 hectare Ex-periment and Demonstration Farm in Talang Padang village, Tanggamus which is used for a demonstration plot coffee nursery training as well as loca-tion for good coffee clones collection from ICCRI.

This partnership, which has now in-volved 15,000 coffee farmers in Lam-pung, continues to grow and involve other stakeholders. In 2012, together with WWF, Nestlé Indonesia through NEWTrees program, conducted train-ing for farmers on how to preserve the environment and also planted 8,000 silk trees (Albizia Chinensis) as a form of land conservation effort in Lampung.

Within the same year, Nestlé Indo-nesia also launched a global initiative called the “NESCAFÉ Plan” that is also being implemented in Lampung as a global effort to source sustainably ma-naged coffee beans and directly buy from farmers. In 2014, Nestlé Indonesia will directly purchase 20,000 tons coffee

beans from KUB, including 15,000 tons produced by some 13,000 4C* certified coffee farmers. This 4C purchasing from KUB by Nestlé Indonesia is a way to trace the location of produced beans, known as ‘Traceabi lity Scheme’.

Rohadi said he has learned a lot since the partnership’s establishment with Nestlé Indonesia in 1994. “From defect system, the application of traceability, and the implementation of 4C certifica-tion. All these things are challenging for us, but we feel more excited to bring out the best results.” Through partnership with Lampung coffee farmers, Nestlé Indonesia ensures that all raw mate rials for NESCAFÉ products from Panjang Factory are directly sourced from coffee farmers who manage their farms in a sustainable way.

Nestlé Indonesia is committed in using 100 percent of Lampung coffee beans, bought directly from the farmers, to produce NESCAFÉ Classic and NESCAFÉ Mixes instant coffee. This, in turn, will add value to Indonesian coffee beans and support the government and the community in improving the farmers’ welfare. The partnership reflects Nestlé’s business concept that has been deve-loped globally, in which for a company to be successful, the communities we serve, need to prosper as well. Hence, there is creating of shared values.

Behind a cup of NESCAFÉ:

100 PERCENT LAMPUNG COFFEE BEANSAgriservice Coffee Team in Lampung

*4C (Common Code for the Coffee Community) Association is a platform that brings together coffee sector stakeholders sector to address sustainability issues in a pre-competitive manner.

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2 Profile

KONSTIYANTO, THE PIONEER OF COFFEE FARMERS JOINT ENTERPRISE GROUP

Since the beginning of the 1980s, the Government, through the Ministry of Agriculture and Ministry of Cooperative and SMEs encourages farmers to coope-

rate with corporations in order to improve agriculture and farmers’ welfare through joint enterprise or cooperative. This program led Konstiyanto, who served as a staff of the Estate Crop Agency in Pulaupanggung District, to encourage coffee farmers to form joint enterprise group so they can improve their welfare. Together they can learn and implement good and integrated agricultural practices, as well as the market-ing process.

During his time in the Estate Crop Agency, Konstiyanto has established three Joint Enterprise Groups (Kelompok Usaha Bersama – KUB). The first was KUB Mawar in 2002, led by Rohadi, one of the senior coffee farmers in Ngarip vil-lage. Konstiyanto later established KUB Sinar Abadi, which unfortunately did not last due to internal problem. Even so, he refused to give up and continued to motivate coffee farmers to join the KUB. In 2010, KUB Robusta Prima was es-tablished in Pulaupanggung. A total of 1,595 farmers from 61 farmer groups joined this KUB.

After his retirement from the Estate Crop Agency, Konstiyanto focused in developing KUB Robusta Prima and was chosen to lead the organization. Two years after its establishment, KUB Robusta Prima was chosen as one of the joint enterprise groups (KUB) trained by Nestlé In-donesia. He also registered KUB Robusta Prima as one of

Nestlé Indonesia factory’s business partners in Panjang. This process required each member to dedicate their time and hard work because they they were expected to provide raw mate-rials in accordance the criteria known as “Nestlé Standard” among the coffee farmers in Lampung. This effort finally made its way when in 2012, KUB Robusta Prima was officially an-nounced as the partner of Nestlé Indonesia factory in Panjang.

Since partnering with Nestlé Indonesia, the economic sta-tus of KUB Robusta Prima and its members was improved, including the financial difficulties faced by the group. The trans parent transaction process, competitive price and form of support in high quality plantlets supply, training cost and KUB development fund, have encouraged its members to produce raw materials of “Nestlé Standard”.

Konstiyanto also mentioned that one of the programs benefiting KUB members was the women coffee farmers empowerment through waste bank training by the Rain-forest Alliance, one of Nestlé Indonesia’s partners. “Having completed the training, women coffee farmers are capable in managing the waste bank, in addition to coffee farm-ing. They are able to produce fertilizer and recycle goods from the compiled waste which can be sold as additional income sources,” said Konstiyanto.

Kostiyanto hopes that the relationship between Nestlé Indonesia and KUB Robusta Prima will sustain and is equal-ly positive for both parties, as well as for the surrounding environment.

The coffee nursery at KUB Robusta PrimaKonstiyanto at the drying coffee area of KUB Robusta Prima

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What’s Going On 3

NESCAFÉ PlanCreating Shared Value

18,000 coffee farmers

1,230,000 quality plantlets by the end of 2014

2010In In 2012the NESCAFÉ Plan was globally launched and implemented in Mexico, Thailand, Indonesia and the Philippines

in Lampung join the partnership

Activities of the NESCAFÉ Plan program in Indonesia are:

Rejuvenation of coffee trees by distributing

THIS PROGRAM IS IMPLEMENTED INTanggamus Regency and

Sumberjaya Regency of Lampung Province

Ministry of Agriculture of RI, ICCRI, Syngenta and Rainforest Alliance

Partners:

8Coffee Farmers Joint Enterprise Groups are involved

of 4C

TARGET

25,000 tons coffee beans by 2015

the NESCAFÉ Plan was launched in Indonesia

4C: Common Code for the Coffee Community

Responsible FARMING,

PRODUCTION, CONSUMPTION

2,5 million quality plantlets by the end of 2015

By 2014

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4 Report

To ensure the success of NESCAFÉ Plan program and to fulfill the com-mitment in 2015, Nestlé organized

a Farmer Connect workshop on June 2-6 in Lampung. In addition to presentation on the latest updates of the program implementation in each country, as well as discussion on local issues, workshop’s participants were also invited to visit the NESCAFÉ Plan site in Tanggamus, Lam-pung. This workshop is expected to result in action plan addressing the current tar-get gap. Following are some photos taken during the workshop.

FARMER CONNECT WORKSHOP in Lampung

The coffee nursery at KUB Robusta Prima

A presentation session led by Stefan Canz

Farmer Connect is our program for direct sourcing from farmers, through which we commit to the local sourcing of raw materials, offering technical assistance and ensuring co-operation to meet the highest sourcing standards.

Editorial Team

EDITOR-IN-CHIEF: Nur Shilla Christianto

WRITER:Elizabeth Wairatta

CONTRIBUTORS:Ade SonyvilleArif Kartika Jenik D.S. Andreas Lukman EfendiValeska Liviani Priadi

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at: elizabeth.wairatta@id.nestle.com

Pruning by one of participants

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