Title Indonesian Journal of Environmental Management and Sustainability e-ISSN:2598-6279 p-ISSN:2598-6260 Research Paper Feasibility of Local Commodities on Peatlands Resti Salmayenti1*, Muhammad Sugihartono2, Elham Sumarga3, Fauziah Nur1, Aan Aryanti Sandra2 1Department of Geophysics and Meteorology, Faculty of Mathematics and Natural Resources, Institut Pertanian Bogor, Bogor, 16680, Indonesia 2Aquaculture Study Program, Faculty of Agriculture, Universitas Batanghari, Jambi, 36122, Indonesia 3School of Life Sciences and Technology, Institut Teknologi Bandung, Bandung, 40132, Indonesia *Corresponding author e-mail: salmayentiresti@gmail.com Abstract Indonesian peat ecosystem, generally managed for protection and cultivation functions, contributes to providing economic benefits to the local community through agricultural practices. This study aims to evaluate the feasibility of local commodity agriculture (coffee, areca, coconut, and pineapple) on peatland from social, ecological, and economic perspectives using descriptive and quantitative approaches in Mendahara-Batanghari, Jambi. Data was collected from interviews of 60 farmers in two villages with three types of farms, including monoculture and polyculture of commodities. The results of this study showed that socially, farmers still have difficulty with access and infrastructures. Coconut, areca, and coffee are popular among the smallholders because of land suitability, low maintenance, and high selling price. From an ecological perspective, intercropping on polyculture farms is able to store more carbon with a high density of biomass than on monoculture farms. Generally, the carbon emissions of local commodity farms are lower than other types of plantations, such as oil palm and rubber plantations. Lastly, from an economic perspective, local commodity farming in the study area is feasible based on analyses of net present value, benefit cost ratio, and internal rate of return. Polyculture farms provide higher benefits compared to monoculture land. The income is considered sufficient for standard living needs, and there is potential to increase the revenue by developing and optimising processing product industries. Keywords Economy Feasibility, Local Commodity, Peatland, Restorations Received: 15 March 2022, Accepted: 7 June 2022 https://doi.org/10.26554/ijems.2022.6.2.67-75 1. INTRODUCTION Indonesia peatlands provide multiple types of important ecosystem services such as carbon storage, water regulation, biodiversity, ecotourism and other cultural services which are valuable for local communities. In case of supporting regional economy, peatland is widely used for agricultural purposes. However, most activities related to land cover changes of peat forests led to a decrease in ecosystem qual- ity. Peat oxidation, biologically, emits around 4.5 tC/ha/yr from burnt peatland and about 7.9 tC/ha/yr from drainage (Hirano et al., 2014). Moreover, drained peatland generates continuous carbon emissions through an oxidation process and affects the lowering groundwater level, implicating land subsidence. Peat fires also produce harmful smoke for health and regularly restrain social and economic activities. Hans- son and Dargusch (2018) estimated that 2-million ha peat restoration would cost US$4.6 billion. The commodities cultivated on peatland vary, and some could lead to ecosystem degradation. Besides economic benefits from agriculture practices, the effects on the en- vironment and social perspective are also essential to be considered. Some agricultural commodities are considered suitable for the peat ecosystem, known as the paludiculture system, which includes the cultivation of fish and livestock on peatlands known as silvofishery and silvopasture (Tata and Susmianto, 2019). This system is introduced in order to support the development of the local economy along with maintaining the ecological function of peatlands. Local com- modities are able to grow on degraded land or shallow peat areas without drainage. According to Uda et al. (2020) some local commodities can promote sustainable agricul- tural activities which have positive values in sustainability, profitability, and scalability aspects, especially sago, banana, and pineapple, followed by kangkong, tengkawang, dragon fruit, mangosteen, and melon. Yanarita et al. (2020) also recommended sago as an alternative for forest restoration economically and socially. The economic, social, and environmental contributions of developing local commodities on peatland are essential to https://doi.org/10.26554/ijems.2022.6.2.67-75 Salmayenti et. al. Indonesian Journal of Environmental Management and Sustainability, 6 (2022) 67-75 analyze (Gunawan and Afriyanti, 2019). According to Bagio et al. (2021) low social awareness (knowledge) on peatland management contributed to drought, potentially leading to economic loss. Many local communities utilize peatland for agricultural purposes in Tanjung Jabung Timur district, Jambi. They cultivate local commodities such as coconut, areca, coffee, and pineapple. Budiman et al. (2020) stated that local commodities help restore the peat ecosystem. This study intends to identify the feasibility of local commodities business on peatland. This aims to initially understand the agricultural practices in the study area from sustainable perspectives, i.e. from social, environmental, and economical perspectives. Two villages in the Peat Hydrological Unit (PHU) of Mendahara-Batanghari, Jambi, Indonesia, were selected as study areas. 2. EXPERIMENTAL SECTION 2.1 Study Area This study was conducted in two villages, Mendahara Tengah and Merbau. Those regions are part of the Mendahara- Batanghari PHU located in sub district Mendahara, district of Tanjung Jabung Timur, Jambi Province (Figure 1). There are several local commodities cultivated by the farmers. This study examined both monoculture and polyculture farming systems of the most popular commodities, including coconut, areca, coffee, and pineapple, by smallholders. This study differentiated the commodities into three groups of farming composition: a monoculture land of pineapple and two polyculture land, coconut areca and coconut areca coffee. Detailed information regarding the area, commodities, and farming system of each study case can be seen in Table 1. Interviews were conducted in both villages with three groups of farmers. 2.2 Methods 2.2.1 Social Acceptance This indicator represents the social preferences of agriculture activity of local commodities. This indicator was elaborated using a descriptive-qualitative analysis based on interviews with the farmers and related stakeholders on the follow- ing parameters: a) access and infrastructure facilities; b) agricultural preferences; c) the influence and interests of stakeholders; and d) perceptions and acceptance of sustain- able agricultural practices. 2.2.2 Environmental Impact This indicator explains the potential environmental impacts of local commodities farming on peatland. The analysis focused on particular aspects including the condition of existing agricultural land, carbon storage, carbon emission, and fertilizer use. The information was collected through interviews with farmers and literature reviews. Figure 1. Area of Case Study of Feasibility Assessment of Local Commodities in Mendahara-Batanghari, Jambi (Badan Restorasi Gambut, 2020) 2.2.3 Financial Feasibility The farming activities are conducted to support the welfare of farmers. In order to analyze the profitability of the farming, this study a) estimated the economic feasibility using NPV, BCR, and IRR approaches using the Equation 1, 2, 3; b) calculated the annual incomes and expenditures comparison; c) analyze the stability of market and price; and d) analysed the potential of added value applied by society in the study area based on Equation 4. NPV = n∑ t=0 Bt − Ct (1 + i)t (1) Note: NPV = net present value, Bt = benefits in t year, Ct = costs in t year, i = interest rate, t = farming year. Net B C = ∑ P.V.Net Benefit(+)∑ P.V.Net Benefit(−) (2) Note: net BC = benefit and costs ratio, net benefit (+) = total benefits in profitable year, net benefit (+) = total benefit in non-profitable year. IRR = [ i′ + NPV′ NPV′ − NPV′′ (i′′ − i′) ] (3) Note: IRRC = internal rate of return, NPV’ = NPV at the interest rate i’, i’ = interest rates that produce positive © 2022 The Authors. Page 68 of 75 Salmayenti et. al. Indonesian Journal of Environmental Management and Sustainability, 6 (2022) 67-75 Table 1. Agricultural Practices of Case Study in KHG Mendahara-Batanghari, Jambi Case Study Village Mendahara Tengah Merbau Area (km2)* 67.3 87.5 Inhabitant (in 2018)* 3,926 2,852 Commodities Coconut areca coffee Coconut areca, pineapple Cropping System Polyculture: coconut (120-160/ha), Polyculture (coconut-areca): coconut areca (1,000-1,300/ha), (140-160/ha), and areca (1,200-1,600/ha), and coffee: (1,100-1,300/ha) monoculture (pineapple) (36,000-51,000/ha) (Badan Pusat Statistika, 2019) NPV, NPV” = NPV at the interest rate i”, i” = interest rates that produce negative NPV. I = B - C (4) Note: I = average income during the farming year (IDR/ha/year), B = average annual benefit (IDR/ha/year), C = average annual costs (IDR/ha/year). 3. RESULTS AND DISCUSSION 3.1 Social Acceptance 3.1.1 Access and Infrastructure Facilities Mendahara Tengah and Merbau villages are only accessible by boat and motorcycle. The distance from the capital city of Jambi Province to Mendahara Tengah and Merbau is approximately 113 and 80 kilometers, respectively. The distance between the agricultural land and settlement area in Mendahara Tengah is within a kilometer radius, and in Merbau is within 1-5 km, even more than 5 km for most coconut areca farmers (65% of respondents). Farmers agreed that the general condition of the infras- tructures in their villages is considerably poor (Table 2). The roads connecting the villages to the capital city of dis- trict are not well constructed. Moreover, there is no paved roadway within the villages. During the wet season, the road made of clay and grass becomes slippery, making trans- portation limited. Motorcycles that the farmers commonly use to reach the buyers are hardly operated during the rainy days. In contrast, during the dry season, the obstacle is encountered by the buyers who transport the product to the main road using boats. These situations become a burden for farmers due to the higher expense needed for transporta- tion. The communication infrastructure is also hardly found in the villages. Internet access is limited in the area close to the river. Therefore, the farmers often complain that there is a lack of information regarding the market condition. 3.1.2 Agricultural Preferences The number of residents who farm coconut, areca, and coffee has increased in the last decades due to the popularity of the commodities (Table 3). This is supported by the higher prices of the products compared to the prices of others. The farmers also favour these commodities because of the lower maintenance costs and even zero fertilizer costs. They only use herbicide to clear the weeds. The main difficulties are the high production costs (additional labour cost for extensive land) and the transportation costs, usually higher during the wet season. For monoculture farming of pineapple, the farmers re- ceived the nurseries from governmental aid. There is no extra cost for fertilizers and pesticides (organic). However, the maintenance of pineapple land is considerably hard. Be- cause the gap between the plant lane is quite close and the plant is relatively small, farmers cannot use herbicide and have to clear the land manually. There are also pests and wild pigs that often eat the plants. Moreover, the price of pineapple is lower than othes. Some farmers are willing to shift their pineapple farm to coffee and areca. 3.1.3 The Influence and Interests of Stakeholders Agricultural development in the study area involves several stakeholders, i.e., farmers, farmer groups, buyers (customers and collectors), local and central governments, and NGOs (Table 4). Farmers have been cultivating local commodities as their main livelihood for decades. There are farmer groups in each village. Farmers use the organization as a forum for discussions about agriculture. However, the continuity of farming depends strongly on the influence of collectors (toke). Toke is the primary buyer for the harvested products. Toke usually give loan to the farmers by taking the potential yields that will be harvested shortly. This purchasing system has been established for decades, and it seems unchangeable. In recent years, other parties, including local govern- ment, governmental peat restoration agency (BRG), and an NGO (WARSI), have run several programs related to the development of sustainable agriculture on peatlands. All parties are interested in introducing more sustainable practices of agriculture on peatlands. The local government has been supplying nurseries of pineapples and supporting entrepreneurship for farmers. BRG and WARSI also pro- vide support in the form of giving processing equipment to add product values, conducting studies and training, and providing assistance to enhance the skills of farmers and © 2022 The Authors. Page 69 of 75 Salmayenti et. al. Indonesian Journal of Environmental Management and Sustainability, 6 (2022) 67-75 Table 2. Satisfying Level of Supporting Infrastructure Conditions in The Study Area Mendahara-Batanghari Response Supporting Infrastructures Roads Transportation Communication Strongly dissatisfied 0% 0% 0% Somewhat dissatisfied 79% 95% 100% Somewhat satisfied 21% 5% 0% Strongly satisfied 0% 0% 0% Table 3. Constraints and Predominant Factors of Local Commodity Cultivation According to Smallholders The Study Area Mendahara-Batanghari Indicator Coconut Areca Coffee Coconut Areca Pineapple Constraints High cost (100%) High cost (90%) High maintenance (100%) Transportation (100%) Transportation (100%) Low price (100%) Benefits Low maintenance (100%) Low maintenance (85%) Low cost (100%) Land suitability (100%) Land suitability (100%) Land suitability (100%) Popularity among farmers (100%) Popularity among farmers (100%) other residents. 3.1.4 Perceptions and Acceptance Toward Local Commodity Development Generally, the farmers have agreed that they have con- tributed to peatland preservation for several reasons. First, the farmers actively expand the cultivation of local commodi- ties. The governments support the development of areca, coffee, and pineapple farming because they require relatively low drainage levels. Secondly, for years, the farmers have started developing awareness about the damages of land fires. In the past, burning was the best, cheapest and fastest procedure to clear the land. They were convinced that the produced ash enhances the fertility of their land. Currently, locals join the government in preventing forest and land fires. The impact of forest fires in 2015 brought trauma for them. Fires have spread and damaged their agricultural land. In addition, the smoke affected their health, resulting in a higher number of Acute Respiratory Infections (ARI) cases, particularly among children patients. However, awareness of residents to protect peat ecosys- tems is still limited. Other essential ecosystem functions of peatlands, such as water and climate regulations and biodiversity protection, are less taken into account. This might be due to a lack of understanding among locals. The respondents mentioned that few have participated in train- ing (15% of coconut-areca farmers). Interviewed farmers in the studied areas are primarily elementary, and junior high school graduates; only 5% of them (coconut-areca farmers) hold a university degree. 3.2 Environmental Impact 3.2.1 Land and Drainage Most agricultural land owned by the respondents was con- verted from the forest. The rest was already cultivated hereditary. The land was converted in several ways in the past, including by manual clearing, forest firing, and indirect firing called peat peeling. Peat peeling is a land clearing procedure that takes out the upper layer of peat (around 20 cm) to be burned in another place blocked by canals to prevent widespread fire. However, the use of fire in land preparation still potentially increases the risk of forest and peat fires. In general, Indonesian forest and peat fires can be strongly linked to human activities (Medrilzam et al., 2014; Sumarga, 2017). After clearing, the land area requires canals and ditches (smaller ones) for drainage (Table 5). The canals are con- structed in the agricultural land by the farmers voluntarily. The width of the canal is approximately 50-100 cm. Most canals are blocked during tide periods to prevent flooding and are opened during the dry season. According to the farmers, the land is becoming drier as an impact of canal construction. 3.2.2 Carbon Emissions Drainage on peatlands reduces the level of groundwater which leads to greenhouse gas production. Drained peat- lands decrease the soil capacity to retain water and acceler- ate the peat decomposition rate (Agus and Subiksa, 2008). Hence, the lower the groundwater level, the higher the car- bon emissions. Table 6 presents the average groundwater level and the estimated carbon emissions from agriculture on peatlands. For comparison, the information of other peatland uses (plantation (sago, oil palm, rubber), primary forests and secondary forests) are also provided. The emis- © 2022 The Authors. Page 70 of 75 Salmayenti et. al. Indonesian Journal of Environmental Management and Sustainability, 6 (2022) 67-75 Table 4. Stakeholders Analysis in Terms of The Development of Local Commodity Cultivation in Study Area KHG Mendahara-Batanghari Stakeholder Power Main Interest Smallholders Cultivating on their (peat) land Increasing their welfare Community of farmers Conducting meeting and discussions Sharing and implementing knowledge Business activity Toke (buyers) Purchasing agricultural products Making profit Giving loan Market monopolism Consumers Purchasing agricultural products Consumption Village government Arranging regulation regarding Preserving peat ecosystem peatland uses at village level Regional government Sharing information and knowledge Regional economic development Supplying aids Human resources development Preserving peat ecosystem NGO and national institution Sharing information and knowledge Regional economic development Providing consultation and assistance Human resources development Supplying aids Preserving peat ecosystem Table 5. The Use of Canals in Local Commodity Plantations in Study Area Mendahara-Batanghari Criteria Coconut Areca Coffee Coconut Areca Pineapple Have no canal 0% 0% 0% Have canals 100% 100% 100% sions from local commodity farming on peatlands are around 17-39 tCO2/ha/yr. This number is higher than emissions from sago plantation, primary and secondary forests, but lower than emissions from the well-known plantation, such as oil palm and rubber which could reach 178 tCO2/ha/yr. It is noted that among the local commodities, the ground- water level for coconut and coffee farms is relatively high, reaching 57 cm. The water level on peatlands needs to be kept below 40–50 cm to slow down land subsidence (Noor, 2001). 3.2.3 Carbon Storage The conversion of peat forest to agricultural land implicates the change in carbon storage. The variability of carbon stored as dry matter biomass (dmt) above land in various land covers is displayed in Table 7. It shows that the carbon stored on a monoculture farm is lower than the one on peat forests due to less biomass and vegetation density. However, an agroforestry system that cultivates several commodities increase the capacity of carbon stored. The intercropping system of polyculture increases the density of vegetation and the capability of carbon absorption. Coffee is a commodity which is recommended for agroforestry/intercropping system. Based on Saidi and Suryani (2021) around 54% of peatlands in Tanjung Jabung Timur are marginal suitable for coffee plantations. 3.2.4 The Use of Fertilizers Exaggeration use of fertilizers on agricultural land would bring negative effects to the ecosystem. According to a study by Landry and Rochefort (2012) the fertilizers for agriculture on peatland are only required on drained poor land. Based on surveys and interviews in this study, most farmers hardly fertilize the land. There are only some minor cases when fertilizers are needed on considered-poor land. As a result, the farming of local commodities in the study area is considered organic. 3.3 Economic Feasibility 3.3.1 Financial Analysis The costs of smallholders in cultivating commodities vary in different regions enormously depending on the social and economic conditions. Farming costs carried out by the small- holders in the study area consist of costs for land preparation, equipment, nurseries, herbicides, planting, harvesting, and transportation. Meanwhile, costs of land, labor, and infras- tructure (canals) are not taken into account because they are voluntary works. The polyculture system has a planting interval between commodities. Generally, coconut is the first commodity to be planted, followed by areca after 4-7 years, and coffee in the next 4 years. Coconut commodities are able to be harvested after 6-8 years, while areca and coffee are harvested after 3-4 years and pineapple after 18 months. The results of financial analysis of local commodity farm- © 2022 The Authors. Page 71 of 75 Salmayenti et. al. Indonesian Journal of Environmental Management and Sustainability, 6 (2022) 67-75 Table 6. Estimation of Carbon Emissions Based on Water Levels in Various Peatland Covers Commodity Average Estimated Carbon Emission Groundwater Level (m) (tCO2/ha/year)* Sago -0.09 to -0.73a 6 to 60 Coconut, coffee -0.3 to -0.5c 21 to 34 Areca -0.25 to -0.57g 17 to 39 Pineapple -0.3 to -0.4d 21 to 27 Oil palm -0.5 to -0.8c,f 45 to 73 Rubber -0.83 to -1.96e 75 to 178 Primary swamp forest -0.13 to +0.1b 0 to 3 Secondary swamp forest -0.3 to -0.56f 3 to 7 Source: a. (Watanabe et al., 2009); b. (Hergoualc’h and Verchot, 2012); c. (Agus and Subiksa, 2008); d. (Situmorang et al., 2019); e. (Wakhid and Nurzakiah, 2021); f. (Adhi et al., 2020); g. (Andesmora, 2021); *Estimated based on Hooijer et al. (2010) with assumption of drained area: 25% for swamp forest, 75% sago, coconut, coffee, pineapple, and 100% for oil palm and rubber plantations. Table 7. Estimation of Carbon Storage Based on Land Cover Types on Peatlands Commodity Carbon Storage (dm ton C/ha) Sago 53a Coconut 51b Coffee 82 (shade), 52 (sun)c 62-79h Agroforestry land 144d Oil palm 2-60e Rubber 32-67f Primary swamp forest 157g Secondary swamp forest 140g Sources: a. (Tata and Susmianto, 2019); b. (Bhagya and Maheswarappa, 2017); c. (Van Noordwijk et al., 2002); d. (Novita et al., 2021); e. (Kho and Jepsen, 2015); f. (Corpuz and Abas, 2014); g. (Krisnawati, 2014); h. (Yunianti et al., 2021). ing in the study area are presented in Table 8. All of the local commodity farming has a positive NPV, which shows that these activities are financially feasible. Three types of farming are also categorized as feasible from the estimated BCR and IRR values. The IRR of the three types of farm is greater than the discount rate (12%), with a BCR of more than one. Therefore, it can be concluded that the devel- opment of local commodities, both monoculture pineapple and coconut-areca and coconut areca coffee (polyculture) farming, can be a financially feasible option for smallholders. 3.3.2 Incomes and Expenditures Comparison The farming area owned by farmers varied from 1 ha to 13 ha. The agricultural activities are carried out by themselves or with families. Meanwhile, the pineapple farmers use a land- sharing system where a group of farmers, namely Sumber Usaha, co-cultivates the land owned by four members. The average area of pineapple farms is 1.6 Ha per farmer, smaller than the area of the other commodities. Table 9 displays the information on income contribution from agricultural activities. The polyculture farms provide higher profit than the monoculture (pineapple) farms. If the production of each type of commodity is compared, the two-commodity land of coconut and areca provide the highest production. After all, the three-commodity farms provide higher income because of higher harvesting frequency and less production cost. Additional labor costs for areca peeler apply in Merbau, while there is no cost in Mendahara Tengah. The farmers or their family members carry out the peeling process in this village. The income from one-hectare polyculture land surpasses the monthly minimum needs per person (UMP) in Jambi. Meanwhile, sharing profit system from pineapple farms only contributes to less than half of UMP Jambi. The sufficiency level of the income depends on the total area owned by each farmer, the number of family members, per- sonal lifestyles, and other sources of income. This study found that all respondents agreed that their income from agricultural activities fulfilled their basic needs, even ex- cessed according to the farmers with extensive land (>10 ha). © 2022 The Authors. Page 72 of 75 Salmayenti et. al. Indonesian Journal of Environmental Management and Sustainability, 6 (2022) 67-75 Table 8. Financial Analysis of Local Commodity Farming in The Study Area Mendahara-Batanghari Indicators Coconut Areca Coffee Coconut Areca Pineapple Total costs (million IDR) 513 1.786 137 Total revenue (million IDR) 3.16 3.758 375 Net benefit (million IDR) 2.804 1.972 237 NPV (million IDR) 447 333 68 IRR (%) 45.95 45.92 218.60 BCR 17.05 22.49 7.65 Note: estimated for one-hectare land with a discount rate of 12% and a 25-year planting period. Table 9. Financial Conditions of Smallholders in The Study Area Mendahara-Batanghari Criteria Unit a b c Land ownership Proprietary % 100 100 100 Labour Family member % 100 100 - Group of farmers % - - 100 Agricultural land Min-max Ha/farmer 2-7 1-13 1-4 average Ha/farmer 3.9 4.5 1.6 Basic needs Family member People 2-4 2-5 1-5 Monthly needs* Million IDR/family/month 5.3-10.6 5.3-13.2 2.6-13.2 Average income Million IDR/month/ha 9.3 6.5 0.96 Adequacy level Excessed % - 10 - Sufficient % 100 90 100 (standard living) Less sufficient % - - - Insufficient % - - - Note: a) coconut areca coffee; b) coconut areca; c) pineapple; *based on provincial standard minimum wage (UMP) Jambi 2020 (Badan Pusat Statistika, 2020). Table 10. Market Condition of Local Commodity Business The Study Area Mendahara-Batanghari Criteria Coconut Areca Coconut PineappleCoffee Areca Nursery purchasing Strongly easy - - 100% Somewhat easy 100% 90% - Somewhat difficult - 10% - Strongly difficult 100% - - Product selling Strongly easy - - - Somewhat easy 70% 15% 100% Somewhat difficult 30% 85% - Strongly difficult - - - Price Strongly stable - - - Somewhat stable 100% 100% 100% Somewhat fluctuate - - - Strongly fluctuate - - - Sales Toke 100% 100% - Market - - 100% 3.3.3 Stability of Market and Price The market condition in the study area is presented in Table 10. Most farmers expressed that it is convenient to pur- chase the nursery. The sales process was also quite simple. Coconut, areca, and coffee are sold to toke, which offers a selling guarantee. The challenge is found in the transporta- tion process, which is costlier during wet seasons. Looking at the price, it tends to be stable because toke monopolies the © 2022 The Authors. Page 73 of 75 Salmayenti et. al. Indonesian Journal of Environmental Management and Sustainability, 6 (2022) 67-75 Table 11. General Condition of The Processed-Product Business in The Study Area, Mendahara-Batanghari Type of Business Business Scale Average Productivity Market Price (IDR/kg) Coffee processing Medium Enterprise 6 ton/year 150,000-250,000 Pineapple dodol Home industry 480-600 kg/year 40,000 market. The farmers of coconut, areca, and coffee concluded that they are satisfied with their commodity preference, and there is no planning on changing the commodity in the near future. On the other hand, most pineapple farms are willing to change their commodity to more profitable ones, such as areca or coffee. 3.3.4 Potential of Added Value Most harvested products from the study area are sold to toke without post-harvest processing. Only a tiny part of coffee and pineapple is processed into roasted coffee and pineapple dodol (traditional food) by locals to add higher product value. The dodol home-processing industry is carried out by the Ketupat Farmer Group in collaboration with BUMDes (village-owned enterprises) in Merbau. The industry is able to produce 40-50 kg of dodol at once (Table 11). With the price at IDR 40,000/kg, the net profit can reach 30% of total revenue or about IDR 600,000 on average. However, production is occasionally carried out because it depends on demand. Marketing is still underdeveloped, and the market is limited due to management and permit issues. The Sus- tainable Peat Farmers Group developed a coffee processing industry in a neighboring village. Their products have been recognized with the brand Peatland Coffee Liberika Menda- hara. The product has already reached the online market with a price range of IDR 150,000-250,000/kg, depending on the quality. In addition, farmers in Merbau also carry out a post-harvest drying process for areca. There is a place to store unsold peeled areca called ’areca house’. Drying the areca increases the price to IDR 19,000/kg instead selling it in logs at IDR 120,000-150,000/sack or as peeled areca at IDR 5,000-9,000/kg. 4. CONCLUSIONS Socially, the local commodities cultivated in the study ar- eas are favored by the stallholders despite the limitation in access and infrastructures and price differences between commodities. All studied farming types are feasible options from an economic perspective, and they generate incomes that are sufficient for basic living costs, from the polycul- ture farming system in particular. This study is an initial analysis of peat friendly local commodity-based business development. In order to improve the local economy, further research is required, including to assess and implementation strategies in facilities and infrastructure development, ap- plication of related sustainable agricultural practices, the development of multiple income based strategy through the application of post harvest technology, processed agro in- dustries, and agro silvofishery, as well as the development of farmer partnerships between villages, local enterprises, and partnerships with the private sector. 5. ACKNOWLEDGMENT This research was supported by Peat Restoration Agency of Indonesia (BRG). We thank our colleagues from Deputy for Research and Development of BRG who provided insight and expertise that greatly assisted the research. We would also like to show our gratitude to the reviewers for their comments during the development of research proposal and results, as well as the farmers and local government staff for the information and the time during the interview process. 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Jurnal Hutan Tropis, 8(3); 306–314 (in Indonesia) Yunianti, I. F., I. Aprianthina, R. Kartikawati, and E. Yu- lianingsih (2021). Emisi Gas Rumah Kaca dan Cadangan Karbon pada Perkebunan Kopi Organik dan Konven- sional di Kabupaten Badung, Bali. Pusat Penelitian dan Pengembangan Perkebunan, 8(1); 1–10 (in Indonesia) © 2022 The Authors. Page 75 of 75 INTRODUCTION EXPERIMENTAL SECTION Study Area Methods Social Acceptance Environmental Impact Financial Feasibility RESULTS AND DISCUSSION Social Acceptance Access and Infrastructure Facilities Agricultural Preferences The Influence and Interests of Stakeholders Perceptions and Acceptance Toward Local Commodity Development Environmental Impact Land and Drainage Carbon Emissions Carbon Storage The Use of Fertilizers Economic Feasibility Financial Analysis Incomes and Expenditures Comparison Stability of Market and Price Potential of Added Value CONCLUSIONS ACKNOWLEDGMENT