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1028

ANALYSIS OF THE EFFICIENCY OF BROWN RICE COMMERCE IN

BATANG ANAI DISTRICT, PADANG PARIAMAN REGENCY, WEST

SUMATRA PROVINCE

Yusri Usman, M. Refdinal, Rusja Rustam

Faculty of Agriculture, Universitas Andalas

[email protected]and.ac.id

ABSTRACT

In the sale of produce, it is often found that farmers get a low proportion of profits and intermediary traders

get a high proportion of profits. This study aims to analyze the profit efficiency of its commercial

institutions. This study used a survey method by sampling brown rice farmers as many as 7 farmers by

census and a sample of intermediary traders based on the involvement of commerce with farmers. This

study used a proportional analysis of the profits of commercial institutions that participated in the brown rice

business. From the results of the study, 2 kinds of brown rice business channels were obtained, namely 1).

Consumer Merchant/Reseller Farmer, 2) Farmer Collecting merchant/Consumer Reseller. From the analysis,

it is obtained that on business channel 1 the profit received is equal to the proportional profit because it is a

direct business channel. In the tataniaga channel 2, the profits of the commercial institutions are

disproportionate where the farmer gets the profit received lower than the proportional profit and the

collector/retailer gets the profit received higher than the proportional profit, so the tataniaga channel 2 is

inefficient. It is recommended to hold agricultural business analysis counseling to farmers about calculating

the cost of farming, awareness to farmers that selling products is a business problem, and provide market

information to farmers.→→→

Keywords: brown rice, the profit received, proportional profit

This article is licensed under CC BY-SA 4.0

INTRODUCTION

Brown rice is a natural grain that contains anthocyanins which are a source of red color

(Zhu, 2018). The advantages of brown rice compared to white rice are its nutritional content

such as fiber content, essential fatty acids, and rich in complex B vitamins, especially folic

acid. The high content of folic acid in synergy with fiber and essential fats causes brown rice

to have an advantage over white rice (Michaelsen et al., 2009). The nutritional content of brown

rice per 100 g, consists of protein 7.5 g, fat 0.9 g, carbohydrates 77.6 g, calcium 16 mg,

phosphorus 163 mg, iron 0.3 g, vitamin B1 0.21 mg, and anthocyanins (Indriyani & Suyanto,

2014).

Governance is the implementation of activities and businesses that aim to flow goods and

services from the point of production to the point of consumption. Agricultural commerce is

an exchange process that includes a series of activities aimed at moving goods or services from

farmers to consumers (Hamid, 1994).

Mubyarto (1989) said that the efficiency of the business system is to be able to hold a fair

share of the overall price paid by the end consumer to all those who participate in the production

and trading activities of the goods. What is meant by fair is the provision of recompense from

the functions of production and commerce in accordance with their respective donations.

Agricultural commodities consumed by consumers are produced and marketed by

partnerships between farmers as producers and intermediary traders as marketers (Jahroh &

Meliala, 2021). Producer farmers and intermediary traders embed each of their inputs or

Analysis of the Efficiency of Brown Rice Commerce in Batang Anai District, Padang Pariaman

Regency, West Sumatra Province

1029 2, 3., February 2023

sacrifices to produce and market products to consumers (Batt & Cadilhon, 2007). For example,

the business channel of an agricultural commodity is: farmers collecting consumer retailers. In

the business channel, farmers invest 50% of inputs, 30% in collecting merchants, and 20% of

retailers, so ideally each partner will also get a share of profits proportional to the inputs they

each instill, namely farmers get a profit of 50% of the total profit in the commerce channel,

collecting merchants get 30% and retailers 20%. A proportional profit is a profit that

corresponds to the portion of input sacrificed (Lee et al., 2002). In reality on the ground is the

profit that farmers and intermediary traders receive equal to their proportional profits? If it's

the same, that's what's called a proportional advantage or a fair advantage. The profit received

by farmers and intermediary traders is the profit they receive during the trading system of the

commodities they trade→→→ (Usman Yusri, 2018).

The improvement of commerce is closely related to the improvement of the efficiency of

commerce systems (Chandrasekar Subramaniam, 2002). The efficiency of commerce is very

necessary so that the institutions involved get the share they receive according to what they

have spent in the business process so as to reduce the profit gap.

Batang Anai Subdistrict is an area in Padang Pariaman Regency that implements a brown

rice farming system. This brown rice was first introduced by Mr. Marsilan who is the Chairman

of the West Sumatra Farmers Association in 2010. Batang Anai Subdistrict has the potential to

develop brown rice farming businesses. However, there are still few farmers who implement

brown rice farming because farmers work more on white rice because white rice has a larger

market and consumers than brown rice. The farmers who cultivate brown rice are still

individually and alternately between each member of the farmer group (Arunrat et al., 2021).

Based on interviews with the chairman of Farmer Groups Indah Sakato and Kelompok

Tani Hidayah at the time of the preliminary survey, it is suspected that there are 2 patterns of

brown rice trading channels in Batang Anai District, namely (1) Farmers – consumers, (2)

Farmers – collecting traders – RMU administrators – consumers. RMU (Rice Milling Unit) is

a rice mill in Batang Anai District. RMU is the only rice mill in Padang Pariaman Regency that

produces brown rice that already has a label. To be able to buy brown rice, consumers can

directly come to the RMU (Rice Miling Unit) or can contact farmers. The consumers who buy

brown rice mostly come from outside Nagari Kasang, from outside West Sumatra to outside

Sumatra Island.

Brown rice farmers usually sell their crops in the form of grain. These brown rice farmers

generally sell their grain to the RMU in the Batang Anai District area at a price set by the RMU.

The price of brown rice grains sold by farmers is Rp. 6,100 / kg, or Rp. 8,700 / kg of rice while

the selling price of brown rice to consumers is Rp. 20,000 / kg. From the information above,

there is a very large business margin, which is IDR 1 1. 300/Kg. From this price margin figure

which is greater than the farmer's price, it can be presumed that there is a disproportionate

distribution of profits obtained by farmers with traders, where farmers get a small profit while

their contribution to the procurement of production and commerce is so large, namely from

donations in the production process to sales, while traders make a large profit compared to

donations that he sacrificed. The purpose of this study is to describe the brown rice business

channels and business functions carried out by each commercial institution involved in brown

rice business from Batang Anai District, Padang Pariaman Regency, and to analyze the

proportionality of profits of commercial institutions that participate in the distribution of brown

Analysis of the Efficiency of Brown Rice Commerce in Batang Anai District, Padang Pariaman Regency, West

Sumatra Province

1030 2, 3., February 2023

rice. The benefit of this research is a consideration for farmers in marketing brown rice

production and input for the government to take policies so as to improve the welfare of farmers

(Reijntjes et al., 1992).

METHOD

The method used in this study is the survey method. According to Nazir (2017), the survey

method is a method used to investigate, dissect and evaluate the situation to obtain facts from

existing symptoms and seek factual information about the social, economic, and political

institutions of a group or regional scatter. The purpose of the survey method is to get an

overview that represents the research area.

In this study, an investigation and observation of brown rice commercial institutions were

carried out. The survey method is carried out in chains by observing the pattern of brown rice

business channels, and the business functions carried out by each commercial institution

involved in brown rice trading ranging from the level of sample farmers as producers to

retailers.

Sampling Methods

From the survey, it is known that in the area there are 2 farmer groups that work on brown

rice, namely Farmer Groups Indah Sakato 5 farmers and Kelompok Tani Pelita Gunung 2

farmers. For this reason, farmers who grow brown rice are taken as a whole as respondent

farmers on a census basis. For the sample of intermediate traders, the sample was taken based

on his involvement in the brown rice trade with the sample farmers.

Data Collection Methods

The data collected in this study are primary data and secondary data. Using a list of

questionnaires and interviews on the part of farmers and respondent traders. The data period

taken is brown rice farming data for the growing season of November 2019-February 2020.

The primary data collected are:

1. The primary data from farmers are the identity of farmers, the cost of farming and the

cost of governance, the production of production prices, and information on the management

of brown rice. Data from sample traders include the identity of traders, price buy and price of

brown rice, cost tataniaga as well as brown rice business information

2. Secondary is data obtained from literature derived from relevant institutions or agencies.

Observed variables

The variables observed to achieve the objectives of this study are:

a. Agricultural costs: farm costs, commercial costs, amount of production, selling price,

receipts, and profits of the farming business

b. Intermediary traders, commercial fees, purchase price and selling price, receipts and

profits of commerce.

c. Overview of brown rice trading channels

Analysis of the Efficiency of Brown Rice Commerce in Batang Anai District, Padang Pariaman

Regency, West Sumatra Province

1031 2, 3., February 2023

Data Analysis

To answer the first question, namely describing the brown rice tataniga channel in Batang

Anai District, Padang Pariaman Regency, a descriptive analysis was carried out. From the

primary data, a business channel will be obtained starting from the farmer level to other

commercial institutions involved,

To answer the second question, namely analyzing the efficiency of commerce using an

analysis of the proportionality of profits of commercial institutions. A proportional profit is an

efficient profit in commerce.

1). Profit received by Farmers = Revenue – (Total Cost of Farming + Cost of Farming)

2). Profit received by Traders = Merchant acceptance – Total cost of trading

3). Proportionality of Advantages:

a). Proportionality of Farmers' Profits ≡ Profits received by farmers =

Farmers' Proportional Profits

b). Proportionality of Trader's Profit ≡ Profit received by Trader =

Traders' Proportional Profits

Or:

a). % Profits received by Farmers = % Costs Sacrificed by Farmers

b). % Profit received by the Trader = % Fees that the Trader Sacrifices

RESULTS AND DISCUSSION

Brown Rice Tataniaga Channel

To see the brown rice business channel in Batang Anai District, Padang Pariaman Regency,

is carried out by tracing the business activities carried out from the farmer level to the

consumer. From the results of the observations made, there are 2 patterns of brown rice

business channels, namely:

Channel 1: Farmers/merchants of Consumer ➔retailers

Channel 2: Farmer Collecting Merchants/Consumer Retailers➔➔

1 (38,90%)

2 (61.10%)

Figure 1. Brown Rice Business Channel Scheme in Batang Anai District1

Proportionality Analysis of Profits of Tataniaga Institutions

Tataniaga Channel 1.

Tataniaga channel 1 brown rice is a direct business channel where farmers double as the

sword of retailers who distribute brown rice directly to consumers. For that the profit received

is also a proportional profit.

Farmer

User

Collecting Merchants/Resellers

Analysis of the Efficiency of Brown Rice Commerce in Batang Anai District, Padang Pariaman Regency, West

Sumatra Province

1032 2, 3., February 2023

Tataniaga Channel 2.

In this tataniaga channel 2, 2 commercial institutions are involved, namely farmers and

collectors/retailers who deliver brown rice to consumers.

In Table 1 of the ta tataniaga 2 channel, it can be seen that the profit received by farmers of

Rp. 4,514.98/kg of rice and the trade collectors/retailers of Rp. 8,345.95/kg of rice is not equal

to the proportional profit, namely for farmers Rp. 5,791.28 /kg of rice, pe collector/retailer

trade Rp 7,069.65/kg. It can be seen that the farmer gets profit he receives is less than the

proportional profit he should have received and the collecting merchant/retailer gets the profit

he receives is greater than the proportional profit he should have received a. Also the percentage

of profit received by farmers (35.11%) is smaller than the percentage of costs incurred by

farmers, which is 45.03%.

The percentage of profit that the collecting merchant/retailer receives (64.89%) is greater

than the percentage of costs it incurs (54.97%). It can be said that the profits that farmers

receive are disproportionate and the profits that collectors/retailers receive are also

disproportionate. Based on the percentage of profit received from proportional profit, it can be

seen that the farmer receives 77.96% of the proportional profit he should have received and the

collecting merchant/retailer gets the profit he received 118.05% of the proportional profit he

should have received. It also shows that farmers get profits they receive below 100% and

collectors/retailers get profits they receive above 100%. Some of the farmers' profits that

farmers have to receive turn to the benefits that collectors/retailers receive. It can be concluded

that business channel 2 does not provide proportional benefits to each of the existing

commercial institutions of this channel, so this business channel based on profit sharing is an

inefficient channel. From the results of this analysis, it can be seen that farmers are weak in

determining the selling price of their brown rice with collectors/retailers.

Table 1. Proportionality of Profits of Farmers and Intermediary Traders in the Rice Trade

System

Red from Batang Anai District, Padang Pariaman Regency

Tataniaga

Channel 1

Tataniaga Channel 2

Farmer/Pdg

g Reseller

Farmer

Pdgng

Collector/Resel

ler

Sum

Cost (Rp/kg)

2.952.09

1.939,76

2.368.35

4.308,11

Cost Percentage

(%)

100,00

45,03

54,97

100,00

Profit Received

(Rp/kg)

16.241.70

4.514,98

8.345.95

12.860,93

Profit share

received (%)

100,00

35,11

64,89

100,00

Proportional

Profit (Rp/kg)

16.241.70

5.791,28

7.069,65

12.860,93

Analysis of the Efficiency of Brown Rice Commerce in Batang Anai District, Padang Pariaman

Regency, West Sumatra Province

1033 2, 3., February 2023

Profit share

received from

proportional

profit (%)

100,00

77,96

118,05

Profit

Proportionality

Dispropor

tionate

Disproportionat

Similar results were also previously obtained by Iriyani (2010) in his research entitled

Analytical of Patchouli Oil Business from Mara Village, South Sipora District, Mentawai

Islands Regency, West Sumatra Province. In this patchouli oil trading system, 2 tataniaga

channels are found, namely in the tataniaga channel 1: Inter-Regional Merchant Farmers

(PAD) Exporters and tataniaga channels 2: Regional Collecting Merchant Farmers (PPD) Inter-

Regional Traders (PAD) Exporters. From these two tataniaga channels, farmers in business

channel 1 get 96.11% of their proportional profit, while inter-regional traders get 121.52%

profit and exporters 108.04% of their proportional profit. In business channel 2, farmers get

94.95% of profit from their proportional profit Regional Collecting Traders get 114.99% of

profit, Inter-Regional Traders 121.64%, and Exoprtir 108.16% of their respective proportional

profits. It can be seen that the farmer gets a profit below the proportional profit he should

receive and PPD and PAD get a profit above the proportional profit he should receive. For this

reason, it can be said that the tataniaga channel 2 of brown rice is inefficient.→→→→→

Shalahuddin & Hafidh M (2018), in their research Analysis of Cucumber Trading Efficiency

from Kuranji District, Padang City, West Sumatera Province also found disproportionate

profits in farmers, and instead, farmers lost and collecting traders and retailers got profits above

their proportional profits. Of the 2 business channels found in commerce channel 1: Consumer

Retailer Merchant Farmers, the farmer gets a profit received -23.69% of his proportional profit,

and the Retailer Merchant gets a profit of 224.04% of his proportional profit. In business

channel 2: Farmer Merchant Collectors Consumer Retailers, farmers get a profit of -6.08% of

their proportional profits, Collecting Merchants get 101.17% profit and Retailers 155.82% of

each of their proportional profits. →→→→→

Farmers' weakness in transacting the selling price of red rice can be caused by:

1. Farmers do not know market information about the price of brown rice so farmers entrust

the decision of the selling price to collectors/retailers.

2) The collecting trader/retailer is a respected person of the farmer because the collecting

trader/retailer is a) the administrator of the farmer group of which the farmer is a member, b)

the administrator of the RMU the only rice mill in this area where the farmer grinds his red

rice, and c) the collector/retailer merchant often provides farming assistance to the farmer in

his farming business.

3) Farmers don't know how to calculate farm profits. Farmers often feel that they have made

a profit in selling their products if the price of their products is already in excess of the costs

they pay. Generally, farmers only calculate the costs paid, without calculating the costs that are

taken into account.

Analysis of the Efficiency of Brown Rice Commerce in Batang Anai District, Padang Pariaman Regency, West

Sumatra Province

1034 2, 3., February 2023

CONCLUSION

There are 2 kinds of brown rice business channels from Batang Anmai District, Padang

Pariaman Regency, namely: 1. Consumer Producer Farmers, 2. Farmers Producers Collecting

Merchants./→→Consumer Retailers.→ The amount of brown rice that passes through the

Tataniaga I channel is as much as 3 8.90% tataniaga channel 2, amounting to 61.10%.

Commerce channel 1 is a direct business channel that only involves 1 commercial

institution, namely farmers who also function as retailers where the profit they receive is equal

to the proportional profit. In tataniaga channel 2, there are two commercial institutions

involved, namely farmers and collectors/retailers. The farmer gets the profit he receives higher

than his proportional profit and the collector/retailer also gets the profit he receives lower than

his proportional profit. The profits received by farmers and collectors/retailers on tataniaga

channel 2 are disproportionate making commerce inefficient.

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