Feasibility Study of Tangerines and Siamese in Dau District, Malang Regency, Indonesia

Document Type : Original Research

Authors

1 Agricultural Economics, Graduate School, Tribhuwana Tungga Dewi University

2 Agriculture Economics, Postgraduate School, Tribhuwana Tungga Dewi University

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