Chili farmers’ willingness to continue keeping contract farming with agro-industry in Jember Regency
Year 2023
Price and production risks are the biggest problems faced by chili farmers in Jember. They reduce production and price risks by having collaboration with the agro-industry in the form of CF which began in 2009. Many chili farmers did not continue CF because they faced several obstacles and challenges. This study aimed to (1) determine chili farmers’ willingness to continue the CF program and (2) determine the factors that affect chili farmers’ willingness to continue the CF program. A quota sampling technique was used by surveying 70 chili farmers in Jember consisting of 35 farmers currently establishing CF and 35 farmers discontinuing CF. The data were analyzed by using proportion tests and binary logistic regression. The results showed that the level of availability of farmers to continue the CF was 60%. Factors of land suitability, level of price competitiveness, the accuracy of payments, and transparency in determining the quality and quantity of production results have significant positive effects on chili farmers’ willingness to continue CF. Farmer’s age has a negative effect on farmers’ willingness to continue CF. The study suggests that the level of chili farmers’ willingness to continue CF still needs to be increased for the sustainability of CF implementation. Increasing the level of chili farmers’ willingness to continue the CF can be done by increasing the accuracy of payments and transparency in determining the quality and quantity of production, considering these two things are the main problems that chili farmers in Jember are reluctant to continue CF. Contract enforcement agencies need to be established to protect both parties from that problem.