Engaging smallholder rubber producers in South Sumatra using the RSS framework

SNV has successfully applied the SHARP Responsible Sourcing from Smallholders (RSS) as a framework for smallholder engagement and support by Indonesian crumb rubber production company Kirana Megatara in the Sembilang-Dangku landscape of South Sumatra.

SNV is a partner in the Kelola-Sendang Partnership for Landscape Management Support, their role being to support sustainable and resilient expansion of oil palm and rubber production through an inclusive business model, promoting better management practices to increase smallholder productivity and improve livelihoods. Seven villages in the Musi Banyuasin District, Mendis, Peninggalan, Lubuk Bintialo, Sako Suban, Berlian Jaya, Pangkalan Bulian and Muara Medak were selected for engagement with rubber smallholders. Initially SNV took on the role of the RSS Implementing Entity, compiling baseline maps and socio-economic information, conducting farm surveys to identify farmer risks and needs and conducting training on better management practices for smallholder rubber production. At the same time SNV studied the supply chains and reached out to downstream supply chain actors to join them in advancing this work. This work has been accompanied by Proforest, in their capacity as global secretariat of the SHARP partnership.

Kirana’s interest in collaborating with SNV has been encouraged by questions raised recently by their buyers about traceability and potential for certification. Kirana are amongst the major players who recently signed up to Global Platform for Sustainable Natural Rubber which aims to harmonize environmental and social standards across the natural rubber industry.

In 2017 SNV signed an MoU with Kirana. SNV’s support and encouragement has led Kirana committing to a use of the RSS framework as a strategy to address these questions and fulfil their commitments to responsible sourcing from smallholder suppliers. Kirana are unique among the rubber companies operating in this landscape in employing a team of Sourcing Development Officers in the field, able to serve as agents for rolling out smallholder engagement. SNV have built up their capacity to deliver training on better management practices and Proforest provided them with training on the RSS framework. Now Kirana have taken over the role of Implementing Entity for the next cycle of an RSS action plan, supporting producer cooperatives in those villages to address a range of social and environmental risks and needs. This includes raising awareness on the need to avoid development on peat, use of fire and mis-use of agro-chemicals, as well as an extension of capacity building to improve productivity and quality control, marketing, strengthening producer cooperatives and access to finance.

This work has already helped improve the flow market information and streamlined the supply of produce from smallholders to the crumb rubber factories. Smallholders are tracking their yields and unit prices and smallholder groups have started supplying some product directly to Kirana’s factory in Jambi. As the quality and value of their production increases they are realising greater profits from their rubber plantations. Also, they are coming to understand the expectations of downstream buyers with respect to environmental conservation in a landscape where there are high conservation values. For Kirana, the value in this partnership is in improving the security of raw material supply to their factory and in being able to demonstrate to buyers responsible production at the base of their supply chain.

In this example of RSS in action, the RSS framework ensures that SNV’s excellent training materials and institutional knowledge are put to good use and their full value realised, while providing a structure that Kirana and other companies can use to engage with smallholders and prioritise efforts to build their capacity building and control risks that their buyers are increasingly concerned with.

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