University of Adelaide researchers are assessing opportunities for Australia's live export industry to respond to Indonesia's plan to substantially increase its dairy cattle imports, under the Indonesian Government's $45 billion Free Nutritious Meal Program.
Dairy farming in Indonesia. Credit: IndoDairy.
The program, which began this year, is a national initiative designed to tackle some of Indonesia's most pressing social challenges: reducing stunting, boosting academic performance, addressing extreme poverty, and improving health and nutrition for 82.9 million children, as well as pregnant and breastfeeding women, by 2029. It also aims to support Indonesia's local agriculture industry and generate jobs along the value chain.
The University of Adelaide's Centre for Global Food and Resources is leading the Australia-Indonesia Dairy Cattle Trade Insights (AI-DCTI) project, commissioned by the Livestock Export RD&E Program (jointly funded by LiveCorp and Meat & Livestock Australia) to help Australia's live export industry understand Indonesia's dairy sector and assess how to respond to this new opportunity.
By early 2026, the AI-DCTI project will provide evidence-based insights into Indonesia's dairy sector and practical recommendations for the Australian industry on how to respond to the growing demand for dairy cattle, while also strengthening the long-term relationship between Australia and Indonesia.
"Regardless of the final number of dairy cattle, Free Nutritious Meal Program creates opportunities for Australian exporters and related industries," said project lead Dr Rida Akzar, who is joined in the research team by Professor Patrick O'Connor and Associate Professor Alexandra Peralta, from the School of Economics and Public Policy.
"Australia and Indonesia already have a long history of working together in sustainable livestock production and animal welfare, and this initiative provides a chance to deepen that relationship."
While Australia has exported dairy cattle to Indonesia previously, it has been a relatively small export market compared to others such as China. Optimising supply of dairy cattle to Indonesia opens new opportunities while also contributing to Indonesia's long-term dairy development goals.
"Importing dairy cattle is only the starting point. The project will explore how to ensure this investment translates into long-term improvements for Indonesia's dairy sector," Dr Akzar said.
The AI-DCTI project will identify pathways for inclusive development, including strengthening farmer capacity through extension services, access to quality feed and veterinary care, and more reliable milk markets, particularly for smallholder farmers.
It will also explore opportunities for Australian service providers and researchers to share expertise in areas such as animal health, genetics, feed systems, cold-chain management and training programs.
The project will generate insights into potential synergies with other export industries such as red meat, grains and feed resources, focusing on how these can enhance Indonesia's dairy sector and support the supply of Australian dairy cattle.
Indonesia's rising demand for milk and dairy products is expected to continue to grow over the next decade, but local production has not kept up. Most fresh milk is produced by smallholder farmers managing only two or three lactating cows, compared to an average of 342 cows on an Australian dairy farm, according to a 2024 report by Dairy Australia.
Productivity is also lower in Indonesia with around 14.9 litres per cow per day, versus 21 litres in Australia.
Smallholder dairy farmers in Indonesia face many challenges, including limited access to feed and veterinary services, limited cold-chain infrastructure, poor market incentives, and reliance on traditional practices. As a result, Indonesia imports about 81 per cent of its dairy needs.
"The emphasis is on creating a long-term win-win outcome: Indonesia gains the animals and knowledge it needs for a stronger, more resilient dairy industry, while Australian breeders, exporters, and service industries benefit from expanded trade," Dr Akzar said.
"In this way, the project goes beyond cattle imports to focus on sustainable sector development that benefits farmers and consumers across both countries."
