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What factors influence crops price fluctuation? (What factors influenced…
What factors influence crops price fluctuation?
What factors influenced in production side?
What makes crops oversupply?
Similar harvest time among different regions
hypo: since farmers depend a lot the weather, they plant similar crops during similar period, which makes the crops production increasing drastically in certain period of time, reducing its price
High production crops
Great weather
Abundant sunlight
Sufficient rain/irrigation
hypo: weather change in Indonesia does not significant, except catastrophe
Great quality of seeds
hypo: new seeds invention might increase production, but in relatively long time
Great quality of fertilizers
hypo: fertilizers do not massively increase crops production
Great quality of soil
Better technique/invention
New training
hypo: govt conduct training, but farmers do not implement it
New tools (e.g. efishery)
hypo: some startups already develop new tool (e.g. precision farming) but too difficult for farmers to implement
Low losses
Great pasca-panen technique
Optimal harvesting technique
hypo: high losses due to primitive post-harvesting technique
concl: 40-50% losses in total (based on research)
ana: check in which post harvest process does the most losses occured
Lots of famers plant certain crops
Previous high demand
hypo: farmers do not plan what crops and how much they plant based on previous demand. only based on usual practice
Government mandate
hypo: govt can encourage farmers to plant certain crops by providing them with seeds. it might affect crops production
Government seeds subsidy
High crops price during previous season
hypo: farmers often tempt to plant crops which are previously profitable and low maintenance (e.g. sengon)
What makes crops undersupply?
Low production crops
Bad weather
Unpredictable dry season
Flood
Hypo: flood and extreme dry season can make crop failure
Pest/infection
Pest treatment is uneffective
New kind of pest
High price of pesticide
Unbalance ecosystem (e.g. snake population decrease, rat population increase)
Hypo: Dramatic increase of pests can make crop failure
High losses
Packaging
Warehousing
Transporting
Sorting and grading
Harvesting
Fewer farmers plant certain crops
Low crops price during previous season
Lack of seeds supply
What factors influenced in distribution side?
High cost
Transportation
Fuel
Driver
Truck rent
Concl: transportation cost has the highest percentage [F7]
Storage
Energy
Building rent
Workforce
Sorting and grading
Risk
Packaging
High losses
Transport
Hypo: not so much losses during transport
Penyusutan
Kerusakan
Storage
Spoiled
Hypo: significant losses only to few specific crops (e.g. cabe, bawang)
Rat
Others
Penimbunan
Hypo: middlemen often practice penimbunan during certain period (e.g. sebelum lebaran)
Uneven distribution
Higher price in certain region
Distributor only sell in that region
Hypo: Kelangkaan di region lain leads to price increase in consumers level
Better infrastructure (e.g. toll road)
Middlemen high profit margin
Hypo: Margin for middlemen can be as high as 50%
Middlemen controls the buy-price from farmers
High barriers to farmers to sell to other middlemen
Loan
Provide supply
Middlemen conspire with others to set buy-price from farmers
Market barriers for new middlemen
What factors influenced in consumers side
Rapid demand change
Lifestyle
Healthy
Organic
Hypo: since healthier and organic crops are expensive, lifestyle change wont affect a lot of consumers
Events (e.g. lebaran, natal)
Sensitive commodity
hypo: no substitute crops (e.g. cabe, bawang)
concl: sensitive to rapid weather change (e.g. cabe, bawang, gula, daging-dagingan, tomat)
Issues
Penyakit hewan (e.g. anthrax)
Boikot
Berita kelangkaan
Hypo: this kind of issues only affect in a short period of time, but might dramatically increase or decrease the demand