Optimising local and imported poultry feed formulation in West Papua, Indonesia : integrating supply chain analysis and least-cost diet formulation : a thesis presented in partial fulfilment of the requirements for the degree of Masters of Agribusiness at the School of Agriculture and Environment, Massey University, Manawatu, Palmerston North, New Zealand

Abstract

Poultry production in Indonesia contributed to the nation’s economy and food security. The poultry sector provides employment all around Indonesia and supplies 65% of the nation’s animal protein, including eggs and meat. This effect extends to the development of poultry sectors in areas like West Papua Province in the eastern part of Indonesia. However, the challenges in the poultry industry are that the total production costs of farms come from the feed costs and the feed supply. The source of feed ingredients in West Papua Province comes from domestic trading within Indonesia or imports, leading to price fluctuations, high production costs, and supply chain vulnerabilities. Subsequently, formulating broiler and layer chicken diets with locally produced and imported ingredients could help lower feed costs and support sustainability. By examining the price and accessibility of locally produced, domestically traded, and imported ingredients for the formulation of poultry diets in West Papua Province, this thesis explores the supply of livestock feed. Linear programming was utilised to formulate poultry diets by incorporating ingredient nutrient composition values against the poultry nutrient requirements. The data on the nutritive values and the costs were obtained from secondary sources, including academic literature, industry reports and statistics, government publications, and online market data. Linear programming has formulated 25 poultry diets utilising both local and imported ingredients without violating necessary nutrient requirements. In exploring supply chain vulnerabilities, a sensitivity analysis was performed on these initial diets. Three additional constraints were introduced by setting a zero-inclusion level for maize only, soybean meal only, and both ingredients. These constraints were applied to each representative broiler and layer diet. The findings in this research were that linear programming found infeasible solutions when formulating the selected broiler diet under these scenarios, demonstrating the dependence of maize and soybean meal. However, linear programming was able to formulate three-layer diets using partly local and imported ingredients, though these were more costly than the original diet. Under the sensitivity analysis scenarios, this research found that even though the initial representative layer diet also partly relied on maize and soybean meal, the initial layer diet could still partially substitute maize and soybean meal with local ingredients. Accordingly, the sensitivity analysis revealed the supply chain vulnerability of the maize and soybean meal, which underscores the cost-effectiveness of poultry production. Therefore, this research provides recommendations in optimising poultry diet formulation, including allowing ingredient flexibility, substitution and diversification, strengthening supply chain partnerships, developing strategies for storage and infrastructure development, and proposing government support and policy can optimise feed formulations. Integrating supply chain analysis and least-cost diet formulation underscores the significance of the supply chain of feed ingredients in the region. Regional agricultural and farm enterprises, the government and the poultry industry, and economic sustainability in West Papua Province or regions in similar settings would benefit from the results of this research.