Dynamic Simulation Model of Cow’s Milk Demand and Supply to Determine the National Fulfillment Ratio

National milk requirement is expected to increase as a result of population growth and the improvement of public awareness of nutrition, especially animal protein. In addition, the increase in household income will boost domestic consumption of milk. Public awareness of milk consumption, pushing milk as an economic commodity that has a strategic value. Demand for milk increased by 14.01% over the period 2002 and 2007. However, on the other hand Indonesia’s milk production grew only 2%. The gap between the growths of consumption and production has increased the number of imported milk. The declining quality of dairy cows has caused a lack of domestic milk supply. This condition due to difficult forage, high prices of raw material concentrate feed, genetic decline of dairy cow, and farm management that is not optimal. Therefore, in this research, we will analyze the supply and demand of milk to determine the fulfillment ratio of national milk. As the research method, we utilized system dynamics based on consideration that this method allows us to consider the internal and external factors, as well as to formulate non-linear relationships among variables. Research results show that national milk demand was around 3.19 million tons in 2015, meanwhile national milk suppy was around 805,819 tons in 2015. National fulfillment ratio of milk was around 25.23% in 2015. With this condition, the required imported milk was around 2.38 million tons in 2015.