TEMPO.CO, Jakarta - Minister of Cooperatives Budi Arie Setiadi revealed that 80 percent of the milk supply to meet domestic demand is imported. According to him, this is because domestic milk production is not able to meet domestic milk demand.

Citing government data, Budi Arie said that national milk consumption in 2022 and 2023 was 4.4 million tons and 4.6 million tons, respectively. Meanwhile, according to existing trade data, national milk consumption in 2022 and 2023 was 4.44 million tons and 3.7 million tons respectively.

"National cow milk production is only 837,223 tons or 20 percent, the remaining 80 percent is imported," Budi Arie said in a press conference at the Ministry of Cooperatives Office in Jakarta on Monday, November 11, 2024.

Currently, the number of national milk producer cooperatives reaches 59 units. In 2023, the number of cows in dairy cooperatives was 227,615. They produced 470,000 tons of milk. Meanwhile, modern cow farms with 32,000 cows can produce 164,000 tons of milk. "A total of 571,000 tons," said Budi Arie.

To meet this demand, the government imports milk from abroad. Indonesia's largest importer is currently New Zealand, which produces 21.3 million tons of milk. Together with Australia, New Zealand benefits from the Free Trade Agreement (FTA) with Indonesia.

This agreement eliminates import tariffs on dairy products, making their products at least 5 percent cheaper than the prices of other global dairy exporters.

The geographical proximity of Australia and New Zealand to Indonesia also makes their dairy products very competitive in terms of price, according to Budi Arie.

Unfortunately, the milk processing industry does not import in the form of fresh milk, but in the form of skim milk powder. However, according to Budi Arie, the quality of skim milk is lower than that of fresh cow's milk because it has undergone various heating processes.

Budi Arie said that importing skim milk would make the price of fresh milk cheaper. The current price of fresh milk is set at Rp7,000. Ideally, the price of fresh milk could reach Rp9,000. "Dairy farmers are losing money," said Budi Arie.

Importing milk is seen by some as a way of not absorbing domestic milk production. The suboptimal absorption of this milk has prompted hundreds of dairy farmers and milk collectors to stage a protest in Boyolali regency, Central Java, on Saturday, November 9, 2024. By smearing their bodies with milk, they protested against the quota restrictions on milk sales to factories or milk processing industries.

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