ANALYSIS OF THE ELASTICITY OF RED CHILI SUPPLY IN TEMANGGUNG REGENCY: A STUDY OF PRICE FACTORS, PRODUCTION COSTS, AND FARMERS' RESPONSES
DOI:
https://doi.org/10.58174/ijimes.v1i9.134Keywords:
Supply Elasticity, Red Chili, Farmer Response, Production Cost.Abstract
Red chili price fluctuations represent one of the structural problems in Indonesia's agricultural trade system, with widespread impacts on food supply stability, farmer welfare, and consumer purchasing power at both regional and national levels. This study aims to analyze the supply elasticity of red chili in Temanggung Regency, identify price and non-price factors determining the degree of supply elasticity, and explore farmers' responses to market price signals within an agricultural economics framework. The research method employed is a descriptive quantitative approach utilizing secondary data on red chili price and supply quantity changes in the market, supplemented by primary data from in-depth interviews with farmer respondents in Temanggung Regency. The analysis results show that the red chili price increased from IDR 30,000/kg to IDR 45,000/kg (a 50% increase), while the quantity supplied only increased from 10,000 kg/week to 12,000 kg/week (a 20% increase), yielding a supply elasticity coefficient (Es) of 0.4, which falls in the inelastic category. This inelastic condition is caused by a combination of structural factors including the limited time of the production cycle from planting to harvest, the perishable physiological nature of chili, limited land capacity and farmer capital, and imperfect price information access at the farmer level. Improving supply flexibility requires comprehensive policy interventions encompassing post-harvest technology development, distribution system strengthening, and enhanced capital access for red chili farmers. The findings of this study make an important contribution to the formulation of evidence-based price and supply stabilization policies for red chili in Temanggung Regency and other chili production centers across Indonesia.
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