Fonterra Enhances Dairy Development Programme in Padang Panjang to Strengthen Local Capability and Support National Food Security

H.E. Phillip Taula, New Zealand Ambassador to Indonesia, welcomed the ongoing collaboration, stating “New Zealand and Indonesia share common values in promoting sustainable livestock and agricultural development. We fully appreciate Fonterra’s role as a bridge between New Zealand’s dairy expertise and the ongoing efforts to strengthen Indonesia’s dairy production sector. Collaborations like this demonstrate how international partnerships can generate real impact for local communities. This knowledge-transfer approach will help enhance food security, stimulate regional economic growth, and further strengthen the longstanding relationship between our two countries.”

Reintroducing the Dairy Partnership Cluster

First launched in 2018, the Dairy Partnership Cluster is a geographically focused initiative within Padang Panjang where smallholder dairy farmers are concentrated. Developed in collaboration with the Padang Panjang City Government and Marapi Singgalang Dairy Co-operative, Fonterra works to:

• Improve the quality of local milk to ensure safe, high-quality fresh milk is accessible and affordable for surrounding communities as a reliable source of dairy nutrition.
• Enhance the local dairy value chain by delivering structured, hands-on training in basic dairy processing, farm management, and livestock care.
• Facilitate access to essential farm tools and infrastructure, including filling machines, milk testing equipment, and animal care tools.
• Strengthen co-operative structures to support sustainable, community-owned growth.

The goal is to raise milk yield and quality, improve farmer incomes, and uplift broader community welfare. The Dairy Partnership Cluster contributes to strengthening dairy regions across Indonesia through a replicable community-based approach.

“Marapi Singgalang Dairy Co-operative has worked hand in hand with Fonterra to strengthen our local dairy sector, and the benefits to our farmers and communities have been clear. This collaboration has brought knowledge, tools, and confidence to our people. We deeply appreciate the continued support from Fonterra, the New Zealand Embassy, the Government of Padang Panjang City, Marapi Singgalang Dairy Co-operative, and all partners involved. Together, we are committed to expanding this initiative so that more communities can experience the same positive impact,” said Hendri Arnis, the Mayor of Padang Panjang City.

Empowering Smallholders to Close the Dairy Supply Gap

Padang Panjang is one of West Sumatra’s leading fresh milk production hubs, known for its cool mountain climate and strong dairy potential. With around 20 active dairy farming households managing 314 dairy cows[1], the region reports daily milk yields of 10–11 litres per cow—above the national average of 8–10 litres[2].

While Padang Panjang has made steady progress, the region also reflects a broader national challenge. Across Indonesia, the majority of dairy farmers are smallholder with around 70% contribution to total output. Most farms manage around 2–3 cows with average productivity still significantly lower than that of advanced dairying nations with 20/30L per day.

The Dairy Partnership Cluster Supports Indonesia's National Dairy Goals

The Dairy Development programme aligns closely with the Indonesian Government’s Asta Cita agenda and its Golden Indonesia 2045 vision, which emphasise food security, rural development, and agricultural advancement as strategic national goals.

Through the impact of the Dairy Partnership Cluster, the programme contributes by:

1. Raising smallholder productivity and milk quality;
2. Strengthening the dairy value chain through investment in infrastructure and tools;
3. Supporting inclusive growth via local co-operatives and skill development.

Yauwanan Wigneswaran, President Director of Fonterra Brands Indonesia, stated “As Indonesia moves toward its 2045 vision, we believe that strong, inclusive dairy communities will be key to that progress. The Dairy Partnership cluster supports Indonesia’s national goals for the dairy sector and rural resilience towards a better agricultural advancement—rooted in partnership, capability-building, and rural empowerment. By investing in people, infrastructure, and long-term collaboration, we’re proud to help shape a future where Indonesian dairy farmers are not just part of the system, but drivers of national growth."

[1] Livestock Population of Padang Panjang, BPS Kota Padang Panjang

[2] Key Performance Indicators (KPI) of the Food and Agriculture Office of Padang Panjang City for 2024–2026