Request For Proposal – GPSNR-RFP-A02-018 Study On Economic Impacts, And Risks, In The Global Natural Rubber Value Chains

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 proposals to disseminate coaching materials and implement coaching on Good Agricultural Practices (GAPs) for smallholders in Indonesia.

Proposed coaching programmes should be implemented in line with GPSNR environmental and social commitments and values, based on the GPSNR Policy Framework[1].

2. OBJECTIVES AND SCOPE OF WORK

2.1 Context

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.

Diseases are a major threat to rubber trees, with 80 – 90% of farmers experiencing tree diseases in 2019 in West Kalimantan and South Sumatra, and 60% in Jambi. When disease (pink and white root rot) attacks trees, the trees should be cut down, leaving not even the stem in the ground, to minimise infection of other trees. A new rubber leaf fall disease is spreading in Sumatra and Kalimantan. This disease causes leaf fall more than twice a year and reduces annual yield by up to 40%. The treatment for this disease is expensive and is often not implemented by smallholders.

Land preparation for replanting is also an important factor for sustainability of production and can lead to lower rubber disease infection rates. Young trees are susceptible to numerous diseases and pests, which smallholders must be coached and financially supported to protect in years 1 – 3. The cost of land preparation and field protection is among the most expensive investments, besides the purchase costs of high yielding clones. Costs incurred during the tree replanting stages is around $2,600 per ha over a 5-year period. During the 6th year, the trees will become productive and operational costs will be $460 pa.

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.

Smallholders’ rubber plots and jungle rubber, as opposed to large, monoculture commercial estates, demonstrate higher animal diversity and may be able to come closer to mimicking the diversity found in natural forest ecosystems. Yet, low yields and record low international prices are driving smallholders to clear their jungle rubber and convert to other land uses such as palm oil. Research indicates in some villages on average, smallholders now grow rubber on only 0.34 ha with another 2.17 ha devoted to oil palm, and 66% of natural rubber plantations had been converted to oil palm. Cultivating oil palm also has other benefits such as i) being less labour intensive and generally farmers do not need to hire external labour – although gross returns of rubber are higher, the lower labour requirement for oil palm makes it more profitable for smallholders; ii) palm oil farmers receive more support from the government and supply chain actors; iii) contract farming arrangements for palm oil enables farmers to get loans/credits and extensions services from companies; and iv) the longer start up time for new rubber trees compared to oil palm is another factor as farmers receive income earlier than when planting rubber.

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]

3. EXPECTED DELIVERABLES

The overall objectives of the GAP coaching programmes are to ensure the long-term sustainability of rubber livelihoods and ecosystems by increasing smallholders’ productivity, yields, and socio-economic resilience, whilst safeguarding nature and the environment.

3.1 Brief Justifications

The proposal should implement GPSNR’s proposed strategy for capacity building in Indonesia and provide brief justifications on the most suitable approach to conduct coaching for smallholders in any of five identified regions:

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

The GPSNR Capacity Building Working Group (Indonesia National Subgroup) may prioritise funding for coaching in regions based on relative productivity, coverage of existing coaching services, socio-economic needs, or other considerations.

3.2 Proposed Coaching Approach

Possible approaches for consideration include (non-exhaustive): mobile coaching at local community centres; building physical training centres; on-farm coaching; hybrid coaching approaches. The proposal should consider which approach represents the best fit for community needs and dynamics.

The proposed coaching approach should consider, but is not limited to, the following priorities:

1. Coaching based on the train-the-trainers (ToT) model
2. Female and other minority inclusion and represention
3. Field coaching (or other approach) implementation plans
4. Integration of technology for data capture and ongoing engagement, and progress tracking (i.e. immediate and longer-term monitoring and evaluation)
5. Others i.e., nuanced approaches to meet geographic/other needs; ongoing farmer community connectivity and interactions; engagement with local or regional officials

Service providers are to adapt the provided GPSNR GAP coaching approaches. The GPSNR GAPs are created to serve as general best practices and principles for global usage and are periodically reviewed and updated to reflect the sector’s latest understandings. The service provider is expected to work with GPSNR to adapt the general GAPs to be in line with local situations in Indonesia in order to build trust with smallholders and to optimize coaching outcomes, especially in terms of language, technical specificities, and local needs.

The GPSNR GAPs consist of the following four modules:

1. Rubber Plant Material
2. Establishment and Maintenance of Plantations
3. Latex Harvesting
4. Diseases and Pests

Service providers are also expected to operate in line with principles and values set forth in the GPSNR Policy Framework[3] such as commitment to environmental protection and sustainability, zero deforestation, community engagement and FPIC etc.

The selected service providermay also be expected to work closely with the GPSNR Capacity Building Working Group (Indonesia National Subgroup) to fine-tuned or further augment the provided coaching materials.

3.3 Key Metrics

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

1. Total number of smallholders coached
2. Total number of trainers or coaches coached
3. Year-by-year increases in smallholder productivity and smallholders engaged
4. Inclusitivity across gender, youth, geographic regions, and ethnicity (e.g., indigenous or other minority communities)
5. Monitoring and evaluation of coaching progress and outcomes

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

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 Expected Deliverables above)
2. Timeline and key stages of operations (based on Expected Timeline below)
3. Budget, including detailed breakdown of expected manpower, logistics, and costs expected to run coaching programmes for an initial two years, beginning in 2022 (based on 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
6. Proposals must be received prior to 15 January 2022 to be considered. Proposals should be submitted to yeo.siyuan@gpsnr.org for consideration. You may also reach out to this contact for any questions or clarifications

5. EXPECTED TIMELINE

The work shall begin by February 2022 and the various phases shall be completed in accordance with the dates outlined in the 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 150,000 USD be allocated to the engagement, depending on the proposed coaching approach.

Payment terms shall be:

• 30% at the signing of the contract
• 20% at the first round of coaching conducted
• 30% upon the First Full Review (Dec 2022)
• 20% upon the Second Full Review (Dec 2023)

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. Cost per farmer, and other aspects of the proposed coaching approach or programme
5. Technical expertise/experience of bidder and bidder’s staff
6. Proposed timeline of operations
7. Scale-up plan from 2022 to 2023, and outlook beyond 2023

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.

[1] https://sustainablenaturalrubber.org/policy-framework/
[2] https://www.facsglobal.com/wp-content/uploads/2020/12/Final-Rubber-report-2020.pdf
[3] https://sustainablenaturalrubber.org/policy-framework/

Download RFP here
Contact Person: Yeo Siyuan  – yeo.siyuan@gpsnr.org