Measuring the Competitiveness of Sugarcane Farming A Case Study in Magetan Regency, East Java, Indonesia

Abstract

This study aims to determine the competitiveness of sugarcane farming in Magetan Regency based on measuring the level of competitive advantage, comparative advantage, and impact on government policy. Policy Analysis Matrix (PAM) is used in this research. The result showed that PCR’s value was 0.790 on planting cane and 0.664 on ratoon cane; it is assumed that sugarcane farming has a competitive advantage. While farming also seems to have a comparative advantage since the DRCR planting cane value resulted in 0.950 and 0.772 for ratoon cane. Overall, government policy’s role made sugarcane farming in Magetan Regency attain high competitiveness because the result of NPCO both planting cane and ratoon cane were greater than 1, assuming the government policy on output is protected and profitable for the farmers. Moreover, the value of NPCI planting cane and ratoon cane are 0.603 and 0.643, respectively, indicating the government policy also protects the tradable inputs. However, the policy on non-tradable inputs imposes higher inputs, as the nominal value of TF planting cane is IDR 1,453,706 and TF ratoon cane IDR 1,174,254 for TF ratoon cane. Hence, sugarcane farmers pay non-tradable inputs higher than the social price.