Document Type : Case Study

Authors

• Rahmat Hidayat
• Agnes Quartina Pudjiastuti
• Sumarno Sumarno

Department of Agriculture Economics, Postgraduate School, Tribhuwana Tungga Dewi University, Malang, Indonesia

Abstract

Oranges are favored by consumers, especially during pandemic covid-19, because they contain high vitamin C. Gadingkulon Village, located in Dau District, Indonesia, is one of the largest oranges producing villages. Mainstay plantation commodities of the village are tangerines and siamese. Agricultural commodities generally fluctuate in price and production. The study’s purpose was to evaluate feasibility of farming tangerines and siamese. Data were collected from 87 farmers who grow both types of oranges. Farmers were selected by simple random sampling, where the number is determined using slovin formula. The data were analyzed using investment criteria of revenue cost ratio, benefit cost ratio, break event point for price and production, payback period, net present value and internal rate of return. The results show that tangerine and siamese farming were feasible to develop because investment criteria number exceeds some criteria. Payback period is less than five years, price and production break event point were lower than that received by farmers, net present value is relatively large and positive, rate of return on capital is higher than social opportunity cost of capital. Oranges farming was feasible yet, even though prices have fallen by 10% and production by 30%. Siamese were more profitable than tangerines.

Keywords

• Feasibility
• investment
• tangerines
• siamese

20.1001.1.23832126.2022.9.3.3.3

Main Subjects

• Economics
• Economics of agriculture, natural resources, and the environment

©2022 The author(s). This is an open access article distributed under the terms of the Creative Commons Attribution (CC BY 4.0), which permits unrestricted use, distribution, and reproduction in any medium, as long as the original authors and source are cited. No permission is required from the authors or the publishers.