This report presents a value chain analysis of the peanut industry in West Nusa Tenggara. It shows that peanuts have a ready market in Indonesia but seasonal peaks in supply and lack of local ability to adequately dry, process and store peanuts limits smallholder earning potential. Research is required on improved seed varieties and best operational practices including cultivation versus direct planting, irrigation, fertiliser, weed and pest control. Cash flow problems with inputs (after the rice harvest) could be reduced or eliminated with farmer business management training. Cooperative groups of farmers would provide the potential to develop access to finance, processing, storage and markets. Garuda foods have established a processing facility in Lombok and seek a greater supply of quality peanuts, presenting an opportunity for SADI to assist farm groups to link with Garuda and develop their cooperative activities with an assured market. While improvements within the value chain have the potential to improve net profits for farmers, the analysis shows that understanding of farmer's overall annual farming operation, family and community needs is required for interventions to be adopted and contribute to overall improvements in smallholder income and welfare.

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