Cinnamon in Kerinci, Jambi, Indonesia

80 to 85% of cinnamon worldwide comes from the Kerinci region on the Indonesian island of Sumatra. Kerinci cinnamon is known for its unrivalled quality, due to many factors including its high oil percentage. However, the cinnamon subsector in Kerinci is facing a number of sustainability problems. The supply of the product is endangered because 99% of farmers sell the raw, untreated material but do not have enough money for the drying process. The latter is performed by wholesalers.

Although there is enough cinnamon at the moment, in the long term cinnamon is expected to become rarer and could even disappear. As cinnamon is only harvested every 15 to 20 years, it forms just a small part of the farmers’ income. The cinnamon farmers are not organised, so they do not make much profit out of cinnamon cultivation, nor out of the sales, let alone the planting of new cinnamon trees. Often, cinnamon functions as a back-up for unexpected expenses. Many farmers work as contractors for other farmers or the government.

• Dependence solely on the income from cinnamon and on outdoor work
• Farmers are not properly organised to sell cinnamon or organic vegetables collectively
• Farmers have limited access to financial resources
• Business capacity is very low

• We create a programme for growing organic vegetables (tomatoes, chillies and aubergines) with a good market value. These vegetables can be grown between the cinnamon trees.
• We support the farmers by setting up an internal control system to meet the market requirements of organic certification.
• We ask the local government for more support and engage in setting up networks with financial organisations to give farmers easier access to capital.

In 2018, at least, 953 farmers and their families have received benefits due to our support. Of these:

• 745 are male farmers

• 208 are female farmers

2019 marked an important milestone for TAKTIK.

• TAKTIK has successfully encouraged its farmers to shift from conventional to organic farming. TAKTIK has obtained USDA and European Union organic certifications, involving 143 farmers, covering a total area of 202 ha under organic certification.

• TAKTIK entered into an agreement with Tripper, an Indonesian company, in which TAKTIK will supply 200 tons of conventional and organic cinnamon to Tripper from 2019 to 2020. Cinnamon from TAKTIK is processed by Tripper who sold to global spices distributors, such as Verstegen.

• Rikolto facilitated meetings between TAKTIK and regional dan national governments, in a bid to develop a sustainable partnership. As part of the partnership, TAKTIK received two warehouses from Jambi Plantation Agency and Ministry of Villages, Development of Disadvantaged Regions to help the cooperative accelerate its business and processing activities.

• TAKTIK has created new jobs for rural communities. At least 50 people work as daily workers, while TAKTIK has 28 employees.

2018 brought better news and deals for TAKTIK.

• Rikolto facilitated a business meeting between TAKTIK with two potential buyers, resulting in an agreement to buy cinnamon from TAKTIK after TAKTIK obtains an organic certification.

• Rikolto linked TAKTIK with the Ministry of Villages, Development of Disadvantaged Regions and Village Owned Enterprises. As a result, the Ministry was committed to financing the organic certification costs and providing a warehouse to accelerate the business of TAKTIK.

• 4 extra sources of income in addition to cinnamon: organic vegetables (65%), labour (20%), rice paddy (8%), coffee (7%)
• VECO successfully facilitated the linking of TAKTIK and new buyer Agripro Tridaya Nusantara
• A purchase order between Taktik and Agripro for 22 tons of 8cm stick cinnamon
• Agripro provided significant amounts of working capital (120,000,000 IDR)
• Successful price negotiations have led to a better price for the farmers
• Taktik acquired funding for certification and post-harvest processing equipment from the Ministry of Agriculture
• 2/3 of farmers are producing organic fertilizer and pesticides; for chilli, this has reduced the production cost by 50%
• 502 members are qualified to join the Internal Control System group for Rainforest Certification
• Extra work for women as Taktik operators, sorters and packers and 6 young people joined the Taktik board
• Cinnamon Learning Centre with training modules and field school methods

• The cinnamon trade worldwide will be secured thanks to a more sustainable form of production which will be capable of tackling the challenges of climate change and ensuring a fair price for family farmers.

• Sustained cinnamon trading based on inclusive business practices.

• Improved rural livelihood and increased food security as the cinnamon business grows and benefits farmers.

Payment for Ecosystem Services System Curator 

Firman Supratman - firman.supratman [at] vecoindonesia.or.id