TRUE SHALLOT SEED EFFICIENCY ON THE PRODUCTION AND INCOME OF SHALLOT FARMERS Muhammad Ivan Fadzil (a*), Muhammad Firdaus (b), Netti Tinaprilla (c)
a) Department of Economics, IPB University
Jl. Raya Dramaga Kampus IPB Dramaga Bogor 16680 West Java, Indonesia
Muhammadivan[at]apps.ipb.ac.id
b) Professor at Department of Economics, IPB University
Jl. Raya Dramaga Kampus IPB Dramaga Bogor 16680 West Java, Indonesia
c) Lecturer at Department of Economics, IPB University
Jl. Raya Dramaga Kampus IPB Dramaga Bogor 16680 West Java, Indonesia
Abstract
Shallot is included in volatile food groups in Indonesia. Any fluctuation in shallot production will influence the inflation level. One of the main problems that reduce local shallot production capacity is high production cost. Local shallot is mainly produced from bulb seeds that consume roughly about 50% of the production cost. Therefore, the government introduced a new seed named True Shallot Seed (TSS). It reduces seed cost up to 10 times the initial cost of bulb seeds and offers higher productivity. However, two critical aspects need to be considered, shallot production efficiency and farmer^s income. This study aimed to investigate the potency of true shallot seeds to the profit efficiency and farmer^s income level. The stochastic profit frontier and inefficiency effects model is used to measure the profit efficiency between two groups of farmers. The study was conducted in 3 regions, namely Brebes, Grobogan and Cianjur. The result shows a high level of inefficiency in farmers that utilized TSS or Bulb seeds. However, farmers with bulb seeds have a mean profit efficiency of 76%, higher than farmers with TSS, with a 70% profit efficiency. This means, the farmers who implement TSS are experienced more profit loss than the farmers who do not. It was caused by the farmer^s failure in the nursery phase of the TSS that reduced the potential production and the existence of some market discrimination to the bulb harvested from TSS crops. Lastly, efficiency differences are primarily explained by experience, tenancy, and share of non-agricultural income.
