Analysis of Factors Influencing Processed Cocoa Industry in East Java Indonesia

Abstract

This study aims to analyze the factors that influence the environment in the effort to develop the processed cocoa industry and the efforts made to encourage the development of the East Java processed cocoa industry. The basic method used was descriptive quantitative and qualitative descriptive with secondary data related to cocoa commodities in 2007-2016. The analytical method used to answer the first objective of the factors that influence competitiveness in the perspective of the development of East Java's processed cocoa industry was multiple linear regression analysis and the Porter's Diamond Method to identify competitiveness constraints. Then a descriptive qualitative method through literature study was employed to answer the second objective of the efforts made to improve the development of the processed cocoa industry in East Java. The results of this study indicate that from the Porter's Diamond Method, in general, the East Java processed cocoa industry is not competitive due to limited infrastructure and the difficulty of access to capital sources. The factors that influence competitiveness in the perspective of the development of the East Java processed cocoa industry are export volumes, export prices and cocoa productivity which have a significant positive effect. Based on the constraints from the identification using Porter's Diamond Method, efforts must be made to improve the competitiveness of the processed cocoa industry, namely improving the quality and quality of processed cocoa, increasing export volumes, maintaining export prices, developing processed cocoa industry clusters, facilitating capital access, deregulating policies and developing infrastructure.

Adaptation strategies of farmers to increase capacity in the midst of climate change

“…Temperature, rainfall, humidity, and sunshine intensity are among the climatic elements that influence cocoa plant growth [41]. Plant quality will be affected by climate change [42]. The climatic element noticed in this study is rainfall.…”

Taking a deeper look at the priority of agricultural industry efficiency through the use of data envelopment approach

“…The necessary policies to improve the efficiency of the chocolate industry in East Java, Indonesia, are joint management to increase the scale of the business, as well as increasing the frequency or production capacity, expanding innovative chocolate processing technology so that the resulting products are of high quality and able to meet the demand for foreign chocolate products. This statement is supported by the results of research conducted by Indah, Harya, Fatma, Pratiwi &Harya, Indah, Sudiyarto, Widayanti &. Improved chocolate quality, higher export volumes, stable export prices, the creation of industry clusters, easier technology and access to capital, deregulatory policies, and infrastructure development are all necessary to increase the existence of the chocolate industry.…”

Sustainable Supply Chain Management of Cocoa Beans in Indonesia: A Review

“…Limited supply and inconsistent production of cocoa beans becoming challenge for the cocoa industry (Gavrilova, 2021;Geo & Saediman, 2019). Several factors that cause these are low quality of human resources, lack of access to finance and inadequate infrastructure (Indah et al, 2018), pest and disease attacks (EU et al, 2022), deforestation and loss of biodiversity (Renier et al, 2023), the threat of climate change (Igawa et al, 2022) and fairness in the cocoa supply chain (Krauss & Barrientos, 2021).…”

“…Farmers need ongoing assistance and guidance to continue to maintain cocoa production both in quantity and quality. Training to the farmers are required such as cocoa plants rejuvenation to the unproductive cocoa, maintenance and harvesting of cocoa including fermentation practices (Indah et al, 2018). This routine training program will provide support to farmers in spurring production and encourage farmers to maximize the processing of their crops.…”

“…Besides the knowledge and skill required by farmers, the adequate access to finance and infrastructure are also need to be supported (Indah et al, 2018). Farmers can be equipped with alternative business models and implement promising practices for increasing climate resilience and household incomes.…”