CHILI SUPPLY CHAIN AND PRICING MANAGEMENT IN SUMOWONO CENTRAL JAVA

KUSDIARTINI, VERONICA and SUPRIYANTO, IGNATIUS and WIBOWO, BONIFATIUS JUNIANTO and Rahutami, Angelina Ika (2017) CHILI SUPPLY CHAIN AND PRICING MANAGEMENT IN SUMOWONO CENTRAL JAVA. nternational Journal of Business, Economics and Law, Vol. 13, Issue 2(August), 13. ISSN 2289-1552

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Abstract

The agricultural sector is now getting a lot of attention as the price of agricultural commodities, especially chilli, alwaysfluctuates and tends to be high. This study aims to describe the price mechanism and distribution pattern of chili in Central Java with case study of Sumowono District. This study uses secondary and primary data. The results showed that the price gap between producers and consumers is quite large and so far enjoyed by intermediary traders. This fact indicates the inefficiency of supply chain, unavailability of auction market, and management of price by government which not yet optimal. The long chili supply chain is characterized by an unsuccessful institution linked to chili farming. Whereas if the institutions associatedwith agriculture can run well, such as cooperatives, it will be many functions that can be done. The reason is because cooperatives also play a role in securing the chili supply chain. Recommendations in this research are alternatives related to chilli supply chain, farmer's welfare and price stability of chili. To improve the chili supply chain, farmer welfare and price stability, there are three main things to note: institutional, price setting and behavioral change. For institutional cooperation is required between government agencies, agricultural services, trade and farmer groups. Then for the pricing need to be a standard pricethat is a reference for farmers and consumers. Behavior change is done by marketing from farmers to consumers. Meanwhile, thegovernment must also play a role to control the price so that the price of chili can be set every harvest period. With good price condition, farmers have enough capital to prepare the facilities and infrastructure so that it does not depend on the middleman anymore. Keywords: Chili, Supply chain management, Central Java, price

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