Grands projets de développement et pratique foncière en Côte d'Ivoire. L'exemple de ... Analyse régionale des comptes économiques pour les années 1975 à 1979. Evolution ... La gestion paysanne du capital caféier à Bengkulu (Indonésie).
Ruf, F., Jamaluddin, Yoddang, Waris Ardhy 1995. The 'spectacular' efficiency of cocoa smallholders in Sulawesi: why? Until when? ln: Ruf, F. and P.S Siswoputanto (eds), Cocoa Cycles. The economics of cocoa supply. Woodhead Publishing. Cambridge. pp. 339-375.
17 THE "SPECTACULAR" EFFICIENCY OF COCOA
SMALLHOLDERS IN SULAWESI:
WHY? UNTIL WHEN?
François Ruf, Jamaluddin, Yoddang and Waris Ardhy
Using Ule tenu "spectacular" to describe Ule etficiency of Sulawesi's cocoa làrmers requires answers to a nwnber of questions·. How is this efficiency appraised? In which fields is it exerted - economic, social or political? With whom might these Sulawesi family smallholdings be compared? Can Uley be compared fairly wiUI private estates in Ule same country or a neighbowing cowllIy Iike Malaysia? Should they be compared with similar planters in Amca - Ule IUUldreds of thousands of cocoa growers in Côte d'Ivoire or Ghana? Or should Sulawesi's cocoa fanners be compared strictly wiUI other Indonesian producers2? How does the etficiency of cocoa planters measure up to Ule efficiency of other actors in the export sector who are similar targets of state agricultural policies and intervention? Comparing cocoa production profiles in different cOlUltries providcs an excellent basis for developing hypotheses. For example, the near-symmetrical pallem of production decline in Ghana and corresponding rise in Côte d'Ivoire in the 1970s and 1980s helps demonstrate the cyclical flUlctioning ofcocoa economies. Similarly, â
• Aller two missions in 1989 in wlùch the emergent cocea boom was identified, we set up a research progranmle on cecoa economies in Indonesia under the auspices of an agreement l>etwcen ASKINDO and CJI?AD. The authors thank CIRAD-SAR, which funded the entire "Cocea Economies" progranmle and ASK1NDO, which hosts them in Indonesia. We are especially grateful to I. Hasan and to P.S. Siswoputranto without whom notlùng ceuld have been achieved. The themes proposed in this chapter are the entire rcsponsibility of the authors and are not necessarily shared by the institutions mentioned above. 2 The "efficiency" of fanùly smallholdings in Sulawesi and their sales and export system downstrearn began to emerge in late 1980s, a1though the statistics availab1e at the time lagged belùnd reality (Ruf, 1993).
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THE SPECTACULAR EFFICIENCY OF SULAWESrS SMALLHOLDERS
F. RUF, JAMALUDDlN, YODDANG, WARIS ARDHY
comparison of Côte d'Ivoire and Cameroon shows the impact of major events such as the two countries' gaining ofindependence in the early 1960s. What happened in Ivorian politics that did not take place in Cameroon's politics'? Likewise, comparison of Malaysia and Indonesia shows the identical response of the two countries to the international price drop in 1977; except a time-lag oceurred in Indonesia's response while Malaysia's production further stagnated from 1987/88. Do these responses signal the "poor efficiency" of corporate plantations during a period of market crisis?
The question is asked with two lUlderlying hypotheses in mind. Some believe that economies of scale and the success of modem teclUlology in cocoa planting is proven, especially in Malaysia which stands out as a champion. Others recognize the research effort in Malaysia but remain sceptical of the efficiency of large cocoa estates'. The authors of t1ùs paper subscribe to the superior efficiency of smallholders and the relevance of the model of cocoa cycles based on the principle ofpopulation migration (Chapter 1).
These questions aIl deal with important scientific issues in agricultural economics. llûs paper explores these issues in 6 sections using a comparative approach in the context of Sulawesi's cocoa smaIlholders.
Recent worldwide developments in cocoa production have part1y resolved tIûs debate and rendered it out of date. Brazil's cocoa sector now seems c1early in a decline6• Recent difficulties experienced in Malaysia clearly indicate tIlat in spite of research efforts, economies of scale in cocoa planting have yet to be verified7• Comparisons between Afiica and SoutIleast Asia may be confusing.
Section 1 Iùghlights the economic efficiency of Indonesian and Sulawesi family smallholdings in cotnparison with other cocoa booms past and present. Section 2 looks at the question of pseudo-economies of scale and discusses the comparative efficiency of smallholdings and corporate plantations. Section 3 compares the efficiency of family smaIlholdings in Sulawesi and Côte d'Ivoire, taking care to compare data from holdings during the comparable Ivorian "cocoa boom" phase in the 1980s. Although Section 3 focuses on assessment of production costs, it introduces the social dimension of the efficiency of family smallholdings and the specifie features of Sulawesi planters. Section 4 discusses the economic efficiency of certain institutions created by producers; in particular, the godai form of credit by wlùch a plantation is pledged is analyzed. Section 5 examines the efficiency of family holdings in the context of Indonesia's political economy; the various policy impacts on cocoa planters and the marketing system are discussed. Section 6 takes a look at future prospects for cocoa cropping in Indonesia, particularly in Irian Jaya. In conclusion, we make a preliminary appraisal of forest consumed per tonne of cocoa produced and of the impact in terms of extemaIities and international negotiations. What can we leam from the Bugis in terms of alternatives to forest rent for the future ofcocoa?
Even witIùn tIle same region of Southeast Asia, Figure 1 shows that tIle seemingly identical behaviour of Malaysia and Indonesia's cocoa sectors hides profound structural differences. In September 1993, tIle 220,000 tonnes forecasted for bOtIl countries did not hold the same significance for cach COlU1UY. In Malaysia's case it signalled ongoing recession while the same figure represented a grOWtIl trend for Indonesia's sector.
'In favour of the second analysis: Ruf, 1990, 1991; Clarence-Smith, 1990, 1994.
MACROECONOMICS OF SULAWESI'S COCOA BOOM 6 The decline of the 1990s, only partially due to the sprcad of the Witches' broom disease. contribute to show the low efficiency of large estates facing a cocoa price slump. In previous crises, Brazilian estates were sav~ by debt cancellations and subsidies provided by federal and provincial govemments. (See Chapter 3 and Rut7Forget/Gasparetto, 1994).
111e recent arrival of Malaysia and then Indonesia on the international bulk coeoa market was sudden enough to worry "traditional" producer countries in West Africa. The latter had perhaps good reason to feel concerned, since they themselves were in the same position at the begimÙllg of the 20th century before replacing the then dominant South American cOlUltries' and Sâo Tomé. Will Southeast Asia now replace West Africa in today's cocoa market?
3
7 Looking back at past estates. especially in Silo Tomé, Venezuela and Ecuador, Clarence-Smith (forthcoming) uses the tenn "diseconomies ofscale". In sorne way, despite the enomlous efforts of Malaysia in applied research, this concept can also be applied to "modem" estates. There are discconomies of scale, not only with regard to the land factor but also to the capital factor. The more capital is invested in cocoa, the Icss ellicient the famùng system becomes (at 1cast while cocoa priees are low).
See Losch's chapter. Refer also to Leplaideur/Ruf, 1981; Ruf, 1985, CIRAD, 1985.
Cocoa Market Report No 347, Sept 1993, published by ED&F Man.
8
4 With the exception of Brazil until the early 1990s which put up good resistance for reasons which cannot be discussed here ( See Chapter 3 and RutlForget/Gasparetto, 1994).
340
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THE SPECTACULAR EFFlCIENCY OF SULAWESl'S SMALLHOLDERS SRO s pu tonne 7000 •
F. RUF, JAMALUDDIN, YODDANG, WARIS ARDHY
Whereas Malaysia appears to have entered a downward phase of cocoa output, Indonesia seems to be in the midst of a fillI boom, and a strong one, too. TIlis is confinned by recent forecasts for 1993/94: 205,000 tonnes for Malaysia and 250,000 tonnes for Indonesia9 • However, our microeconomic observations lead us to conclude that these forecast figures keep wlderestimating Indonesian production. We believe in a 300,000 tonnes potential of Indonesia in 1993/94. ASKlNDO estimates are even around 280,000 tonnes for the 1993 calendar year.
i
5000 3000 1000~
o 1960/61 _
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80/81
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'-+-Indonesia _
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Tlus preliminary comparison of Indonesia with other COtUltries treats Indonesia as a whole, including the island of Sulawesi. We have a1so combined smallholding and estate production. 1967 was fixed as the starting date of Indonesia's boom because of the 1,000 to 2,000 tonnes of quality cocoa being produced then by state plantations in Java. This volwne however, masks the actual start of a small boom which occurred among larger state plantations in 1974; it a1so hides the stm1 of a velY significmlt boom among small fmnily plmltations in Sulawesi, which was IUlderway in 1974 but did not become apparent lmtil 1980/1981. We cml better iIIustrate our comparison of early stages in cocoa cycles by superimposing on to Sulawesi 1980/1991 fi/:,'llres those of Ghmla from 1900/1911, Côte d'Ivoire from 1919/1930 mld Malaysia from 196211973 (Figure 3)10. TIle dates of data from each country represent the last year in which a COWltry produced 1,000 tOlUles before the start of its cocoa boom.
Thousands of tonnes tOO01
We can make finiller comparisons of early cocoa cycle st.1ges by superimposing on Indonesia's 1977/1993 fi/:,'Ufes those for Malaysia in 1972/88 or even Ghana in 1903/1923 (Figure 2). Il took pioneer planters in Ghana 20 years (from 1903/1904 to 1923/24) to raise production from 1,000 to 200,000 tonnes/year. Il took Indonesian planters less time (from 1976177 to 1993/1994) to l'aise production from 3,000 to 280,000 tonnes/year. Occurring some 80 years later, the Indonesian boom appears to be stronger than that of Ghana.
Cameroon
800
&00
":~ 50
TIle production offamily smallholdings in Sulawesi increased from 1,000 to 80,000 or 90,000 tonnes/year in less than 8 years. Il took 15 years in Ghmla at the beginning of the centwy mld over 12 years in Malaysia in the 1970s mld 1980s to reach sinular output levels.
~
400,
&0
70
80
93
Figure 1 International ICCO price and cocoa production in Indonesia and Malaysia and in Côte d'Ivoire and Cameroon, from 1950/51 to 1993/94 (sources: ICCO, Gill & Duffus and ED&F MAN Cocoa Market Reports; 1993 and 1994 data on Indonesia from ASKINDO and the authors).
342
9 Cocoa Market Report No 350, Sept 1994. They perhaps overestimate Malaysian production as Indonesian cocoa is probably included in the Malaysian statistics (Ruf, 1993).
10 Robin Dand (1993, p. 60) also made a comparison ofthis type (IndonesiaIMalaysialGhana) to stress the dynamism oflndonesia from 1988 to 1991.
343
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THE SPECTACULAR EFFICIENCY OF SULAWESrS SMALLHOLDERS
F. RUF, JAMALUDDTN, YODDANG, WARIS ARDHY
lndonesie: yea, 1 = 1977
Malaysia: yea, 1 = 1972
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Figure 2 Cocoa production in Indonesia (1977 to 1993) and Malaysia (1972 to 1988) and in Indonesia (1973 to 1993) and Ghana (1903 to 1923); (sources: Gill & Duffus and ED&F MAN Cocoa Market Reports; 1992 and 1993 data on Indonesia from ASKINDO and the authors).
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