(CLOSED) Request for Proposal – Study on Living Income Gap in Global Natural Rubber Value Chains – Myanmar

Deadline for submission has been updated to 8th July 2022

1. Introduction

The Global Platform for Sustainable Naural Rubber is an international, multi-stakeholder, voluntary membership initiative committed to improving the socioeconomics and environmental performance of the natural rubber value chain.  Development of the GPSNR was intiated by the CEOs of the World Business Council for Sustainable Development (WBCSD) Tire Industry Project (TIP) in 2018.  Members of the platform include tire manufacturers, rubber suppliers and processors, vehicle makers and NGOs.  Representatives from each of these stakeholder groups have contributed to the development of the Singapore-based platform and the wide-reaching set of priorities that will define strategy and objectives.

The GPSNR aims to support the natural rubber sector to become more sustainable. Key element in achieving  this is to ensure there is capacity among smallholders and industrial plantations to adopt best practices in NR  production. 

GPSNR, through the GPSNR Capacity Building Working Group (Indonesia National Subgroup), is seeking hire a consultant to assess and recommend suitable locations and nursery operators to receive certified planting materials (to be delivered by GPSNR).

Certified planting materials will be distributed to the selected service provider in January 2023, for planting and distribution to smallholders by September 2023.

Proposed programmes should be implemented in line with GPSNR environmental and social commitments and values, based on the GPSNR Policy Framework¹.

¹https://sustainablenaturalrubber.org/policy-framework/

2. Objectives and Scope of Work     

There are approximately 2.25M smallholders in Indonesia, representing 83% of national natural rubber production (3.6 M tonnes). Smallholders cultivate less than 2 ha of land with an average yield of slightly below 1 ton/ha, as compared to state and private commercial plantations achieving 1.4 ton/ha and 1.5 ton/ha respectively. 

Indonesia’s average rubber yield is significantly lower than neighbouring countries in Southeast Asia; such low yield is due to low-quality clones, limited knowledge of Good Agricultural Practices (GAP) and aging trees.

Most rubber trees in Indonesia were planted from 1978-1991 through several government schemes. Given that rubber trees only have a 25-year productive lifespan, with steeply declining yields thereafter, almost all rubber trees planted under these schemes have passed their peak production. Whilst there is no formal data available on tree aging in Indonesia, the Ministry of Agriculture estimates around 600,000 – 700,000 ha of natural rubber plantations need rejuvenation. Replanting should ideally occur on about 4% of plantations annually to ensure a stable output. Yet, it is estimated that between 2010 and 2017 replanting of only 1.3% was undertaken. 

Using the right clone makes a tremendous difference in a rubber tree’s lifetime yields. The productivity of rubber clonal and seedling-derived plants is almost 3 x lower than for certified clones. Across the region, only 5% of farmers received their seedlings through a government programme. Certified nurseries are only located in provincial and district capital cities resulting in limited access to high-yielding planting materials for remote smallholders.

Additionally, poor tapping techniques are another major cause of low yields and can decrease the productive life of trees by up to 50%. It is estimated that an average smallholder with 1.5 ha of rubber will earn 57% less than the Indonesian minimum wage.  

Five provinces contribute 66.5% of national production: South Sumatra, North Sumatra, Jambi, Riau, and West Kalimantan. South Sumatra province is Indonesia’s largest and most productive area. Its natural rubber area is almost 23% of the total national productive area and smallholders’ plantations take up 98.5% of this area. The productivity of smallholders in South Sumatra is the highest among smallholder areas in Indonesia, producing 1.3 ton/ha, and more likely to have received GAP training. In 2019 the government announced a replanting plan for 2019 – 2027, with a focus on South Sumatra (92,600 ha), South Kalimantan (76,550 ha) and Jambi (69,900 ha). However, this plan has no large-scale lending programme associated with it and is to be executed by local governments and has not yet been implemented. Demand for replanting is strongest in Jambi, where 40% of farmers are willing to undertake replanting. Demand is lowest in West Kalimantan, where only 1 farmer out of 79 was contemplating. Most likely the demand in Jambi is due to peak planting being undertaken in 1995 – 2005 and the majority of the trees are approaching their maximum productive age, and Jambi farmers are more aware of the importance of good quality clones and their impact on yield – they also have the highest rate of nursery clone purchase – and have suffered less from disease. 

Source:
Financial Assessment of Smallholder Natural Rubber Production in Indonesia. July 2020. USAID Green Invest Asia, HeveaConnect, SNV and Financial Access.²

²https://www.facsglobal.com/wp-content/uploads/2020/12/Final-Rubber-report-2020.pdf

3. Expected Deliverables

The consultant should assess and make recommendations on the following:

Location

Provide detailed rationales for where certified planting materials are most needed amongst the following regions:

1. Northern Sumatra
2. Southern Sumatra
3. Central Sumatra
4. West Kalimantan
5. East Kalimantan

Based on the consultant’s assessments, the GPSNR Capacity Building Working Group (Indonesia National Subgroup) may prioritise funding for specific regions based on relative productivity, coverage of existing coaching services, socio-economic needs, or other considerations.

Nursery Operators

Assess detailed business models of existing nursery operators and projects that outline the long-term environmental, financial, operational and social sustainability of the proposed budwood garden under their management. This should include, but is not limited to, the following:

1. Operational, staff, and maintenance costs of the budwood garden
2. Method of distribution of planting materials to smallholders
3. Selling price of planting materials to smallholders, e.g., Recommended Retail Price (RRP)
4. Other key business plan considerations

Based on the consultant’s recommendations and decision by the GPSNR Capacity Building Working Group, the identified nursery operator will be expected to enter into a Contractual Agreement with GPSNR to ensure geographic and financial accessibility for smallholders to receive the planting materials.

Logistics

The consultant should manage logistics such as the safe transportation of the clonal materials from the source (to be determined by GPSNR) to identified nursery operators

Technical Training and Verification

The consultant should work closely with the identified nursery operator to ensure that the clonal materials are correctly managed. This includes the following:

1. Conducting essential training and supervision on the grafting process for the identified operators
2. Supervision to ensure proper grating procedures is adhered to
3. Manage the necessary technical verification, i.e., validation of the quality of the established budwood garden

All of the consultant’s activities are to operate in line with principles and values set forth in the GPSNR Policy Framework³ such as commitment to environmental protection and sustainability, zero deforestation, community engagement and FPIC etc.

The consultant may also be expected to work closely with the GPSNR Capacity Building Working Group (Indonesia National Subgroup) to fine-tuned or further augment the clone selection and delivery timelines.

Key Metrics

The proposal should elaborate on how the following key metrics can be achieved and measured:

1. Methodology to identify suitable locations and nursery operators
2. Methodology to conduct technical training and supervision on the grafting process
3. Methodology on transportation and other logistics
4. Overall expected costs

Proposals are also encouraged to include key metrics of importance not listed above.

³https://sustainablenaturalrubber.org/policy-framework/

4. Proposal Format and Contents

The proposal should include the following:

1. A workplan that outlines all key activities of the deliverables (as outlined in 3. Expected Deliverables above)
2. Timeline and key stages of operations (based on 5. Expected Timeline below)
3. Budget, including detailed breakdown of expected manpower, logistics, and costs (based on 6. Budget below)
4. Description of past work and technical expertise that is relevant to this RFP
5. A list of project team members with their roles in the project and associated qualifications
   

5. Expected Timelines

The work shall begin by July 2022 and the various phases shall be completed in accordance with the approximate timeline below:

Consultants will also provide fortnightly or monthly progress updates to the GPSNR Capacity Working Group, or on an as-needed basis.

6. Budget

The Platform is anticipating that the total budget of no more than 26,000 EUR be allocated to the Four Stages of the project. The approximate expected breakdown for each Stage is as such:

Payment terms shall be:

• 30% at the signing of the contract
• 20% upon the First Full Review
• 20% upon the Second Full Review
• 30% upon the delivery of planting materials

7. Evaluation Factors

GPSNR will rate proposals based on the following factors:

1. Responsiveness to the requirements set forth in this Request for Proposal
2. Relevant past performance/experience of the consultant
3. Samples of work (e.g., previous training or coaching programmes in Indonesia)
4. Technical expertise/experience of bidder and bidder’s staff
5. Proposed timeline of operations

GPSNR reserves the right to award to the bidder that presents the best value to GPSNR as determined solely by GPSNR in its absolute discretion.

Introduction & Background

The Global Platform for Sustainable Natural Rubber (GPSNR) is an international multi-stakeholder, voluntary membership initiative seeking to lead improvements in the socioeconomic and environmental performance of the natural rubber value chain. Members of the platform include tire manufacturers, rubber producers and processors, vehicle makers and NGOs.

In December 2021, GPSNR members approved Reporting Requirements that would allow member companies to report on their progress implementing their commitments under the Policy Framework. With the approval of the reporting requirements, ordinary member companies shall report annually on the questions included in the Reporting Requirements for the member’s reporting category.

GPSNR members are required to submit data for the previous year according to the following reporting timelines:
• Category A and Category B: Industrial Producers or Processors and Traders of Raw Materials: on or before 30 June
• Category C: Manufacturers and Traders of Processed Material: on or before 30 September
• Category D: OEMs and End Users: on or before 31 December.

To support GPSNR members in fulfilling their obligations under the Reporting Requirements, the platform is calling for consultants to develop a systemic view of the reporting process, inclusive of developing supporting documents and reporting templates for members to facilitate reporting, and exploring the potential user interface and portal design for data submission to ease the integration and consolidation of reported information from various GPSNR member categories.

Reporting scope and materiality are topics for consultant’s review and suggestion based on the GPSNR reporting requirement.

The reporting process should cover the following scenarios (non-exhaustive list):
(i) tier-1 supplier is disclosed to GPSNR
(ii) tier-1 supplier is not disclosed to GPSNR
(iii) members with suppliers across different category groups that are not GPSNR members
(iv) members with external reports that may substantiate the GPSNR reporting requirement
(v) how the information is consolidated at GPSNR level at the end of each category reporting cycle

Figure below is taking one example of tire maker category member reporting on NR supply chain scope to illustrate the potential complexity of the reporting process.

The expected documents to be developed should include:

• A guidance document for each reporting category outlining the appropriate methodology and reporting format for each question, with reference to necessary definitions. One example of reporting segment that requires guidance is Policy Component 2.5 and 2.6 for member categories C and D.
• Standardized reporting templates which may utilize word documents, excel spreadsheets, or other appropriate reporting formats.

The documents developed should ensure that data can be consolidated easily across the supply chain with an understanding that the information will be passed downstream. Where appropriate, the requested data should align with data gathered by other reporting schemes to reduce the reporting burden (including, but not limited to, CDP, Ecovadis, ZSL SPOTT, GRI, FSC, PEFC, SNR-i).

The reporting user interface which includes ability for member to upload supporting evidence (e.g., documents, photos etc) and portal design should also enable easy intake by the Secretariat for data analysis, verification and reporting. The ability to design integration with Salesforce is a plus.

Submission Guidelines & Requirements

The following submission guidelines & requirements apply to this Request for Proposal:

1. Proposals will only be accepted from individuals or firms with experience relevant to this project.
2. Examples of previous relevant work should be provided as well.
3. A technical proposal must be provided that should be around 6 pages in length. This technical proposal must provide an overview of the proposed methodology as well as resumes of all key personnel performing the work. In addition, the technical proposal should provide a proposed schedule and milestones, as applicable.
4. A price proposal must be provided that is not more than 1 page. This price proposal should indicate the overall fixed price for the project as well as daily rates and an estimated total number of days.
5. Proposals must be signed by a representative that is authorized to commit bidder’s company.
6. Proposals must be received prior to 14th of March to be considered. Proposals should be submitted to stefano.savi@gpsnr.org and aidan@gpsnr.org for consideration.
7. GPSNR anticipates shortlisting at least two individuals or firms to have more in-depth discussions with, and will make an award to one of these “down-selected” individuals or firms.

Project Timelines

The Request for Proposal timeline is as follows:

Budget

The Platform is anticipating that a total budget of no more than 30,000 SGD. If the consultant deems that travel plans are required to execute this project, these should be included in the proposal (along with any additional budgetary requirements).

Payment terms shall be:

●       20% at the signing of the contract
●       30% at the midpoint date to be agreed upon and memorialized in the contract based on the submitted work plan
●       50% on delivery of the final report

Evaluation Factors

GPSNR will rate proposals based on the following factors, with cost being the most important factor:

1. Cost
2. Responsiveness to the requirements set forth in this Request for Proposals
3. Relevant past performance/experience
4. Technical expertise/experience of bidder and bidder’s staff
5. The ability to collect relevant information at the global and local level

GPSNR reserves the right to award to the bidder that presents the best value to GPSNR as determined solely by GPSNR in its absolute discretion.