The Beef Division operates in the three principal production stages of beef cattle breeding, beef cattle fattening and meat processing.
The Division's three feedlots are ideally located in agricultural belts in Lampung and East Java where quality feed ingredients are abundant. These feedlots turnoff approximately 150,000 head of cattle every year.
The Lampung Bekri feedlot is recognized as the 1st UNFCCC (United Nation Framework Convention on Climate Change) approved methane abatement project for cattle manure. As a result, our cows leave only a small carbon footprint.
Japfa's Beef Division, which trades under the brand name "Santori" is the largest cattle breeding and feedlot operation in Asia. The Beef Division is made up of two entities, PT Santosa Agrindo and PT Austasia Stockfeed.
Beef consumption in Indonesia is predominantly in the form of "bakso" or meat balls which is consumed throughout the year. Consumption however doubles during religious festivities as beef dishes are an integral part of the traditional foods offered during celebrations. Whilst the local cattle herd still provides the bulk of the national beef demand, imported lot fed cattle are capturing a greater market share in the major cities. This is due to the rapid increase in demand for beef which has significantly outpaced the domestic supply capability. However, an increase in demand will not be easily supplied by the local herd due to the longer production cycle. The low per capita beef consumption of less than 2 kg offers tremendous upside growth potential.
Beef Cattle Breeding
Santori has begun to develop a semi-extensive breeding operation next to their Jabung feedlot in Lampung. This is in line with the Indonesian government policy to increase the national herd. The breeding program will be aimed at not only increasing the nation's herd size but also to improve the genetic pool. The veterinarian team and stockmen provide around the clock supervision of the breeding and feeder herd to ensure the highest cattle comfort and welfare is maintained.
Beef Cattle Fattening
The Beef Division attributes its success in maintaining its position as the outright leader in the industry to its integrated cattle management system of procurement, feed production and distribution.
The company's management information system (MIS) contains detailed data collected from over one million individual cattle imported over the last decade. This allows the company to trace back to individual cattle producers in Australia and to procure the most suitable cattle for its feedlot operations in Indonesia.
In addition to growing corn on company owned fields, Santori has supply arrangements with farmers and food industries to purchase their by-products to ensure a continuous supply of ingredients for the production of consistent quality cattle feed.
With feed production exceeding 150,000 tons per annum, the Company's nutritionists and quality control systems are able to convert otherwise low value local agricultural by-products into a high performance feed, achieving a cattle weight gain of 1.5 kg daily.
A network of loyal traders and butchers throughout Java and Sumatra ensures that our cattle are distributed efficiently to traditional markets.
Approximately 10% of its annual turnoff is processed in the company owned new abattoir in Serang, Banten. In this way, the company can control the entire cold chain operation which enhances meat quality and maximizes shelf life of its "Santori Beef" branded meat products.
All cattle are halal slaughtered in accordance with Islamic rites under the supervision of the MUI (Indonesian Ulama Council). Meat is graded, air-vacuum packed, aged and branded under the "Santori Beef" brand. Distribution covers all major modern retailers and selected restaurants and hotels. With integration in the overall beef production chain, Santori is able to produce a variety of top quality products of beef, offal and value added products including portion control pre-packs, bakso and sausages.
As part of its long term market development program, the Beef Division has recently introduced a new Wagyu beef product, trading under the brand name of "Tokusen Wagyu Beef". Produced from imported Australian bred Wagyu cattle, Tokusen Wagyu Beef is the first Wagyu beef product that is produced and processed from an Indonesian feedlot and abattoir.
Global warming and its impact on climate change is a key environmental concern. "Livestock are responsible for 18% of the greenhouse gases that cause global warming - more than cars, planes and all other form of transport put together" (Source: 2006 report called Livestock's Long Shadow issued by the Food and Agricultural Organization (FAO) of the United Nations).
We are conscious that as the Company's Beef Division operates the biggest cattle feedlot in Asia, it should be environmentally responsible. Accordingly, the Company has implemented a biogas wastewater management project in its feedlot in Bekri, Lampung.
The Lampung Bekri Biogas Project is the first UNFCCC approved (United Nations Framework Convention on Climate Change) methane abatement project for cattle manure in the world. The anaerobic digester waste management system at Lampung Bekri cattle feedlot will reduce greenhouse gas emissions by over 20,000 tones of CO2 equivalent every year.
Other than contributing to a cleaner environment by reducing CO2 emissions, methane gas captured from cattle manure is able to be further converted to energy to generate power. With manure produced from an average of 15,000 head of cattle, the project can produce up to 1 megawatt of electricity. In this way, the Beef Division is committed not just to minimizing carbon traces in its operations, but also to providing alternative non-fossil energy in support of its energy self sufficiency.