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Logistics Receipts Mechanism in

Horticultural Commodities: A
Framework
Bali July 28th 2016

I. BACKGROUND
Table l. Fluctuating Prices of shallot commodity in Losari

Indicator

2011

2012

2013

Averages (IDR/Kg)

19,300

14,800

39,300

Maximum (IDR/Kg)

29,500

20,100

55,900

Minimum (IDR/Kg)

10,650

10,300

20,900

% Changing Accumulation

53.32%

35.81%

42.24%

% Changing Averages

4.40%

2.90%

3.52%

Highest price period

Jan-Feb

May-Jun

Jul-Agust

Lowest price period

Oct-Des

Jan & Okt

Jan-Feb

II. METHODOLOGY
Gereffis concept
First, producers commodity chain exist where the
site of production is relatively immobile and so
production agglomerates in favoured locations.
Second, buyers from commodity chain exist where
is greater mobility.
In the case, the value added by industrial
production tends to be low, at least compared to
buyers commodity chains.

III.

CONCEPTUAL AND FRAMEWORK DESIGN

1.

Factors influence the fluctating prices

2.

Supply and demand interaction in


the fluctating prices
Fluctuating Price

DDDemand Side

Supply Side

Long-commodity Chain

Agriculture Engineering

Distribution-Distance/Cost

Commodity Selection

Wholesaler-Cartel

Farmer capacity

3.

Logistics receipts strategy to


stabilize the price
Table 2. Feasibility of logistics receipts strategy

Baseline from
maximum price to

Changing average
(per month)

Feasible logistics cost


+ revenue

Remark

(per month)
Average price

04.40% (2011); 2.90% (2012); 03.52% (2013)

2.6%

feasible

Minimum price

14.74% (2011); 7.93% (2012); 13.95% (2013)

2.6%

feasible

Logistics receipts strategy to stabilize


the price

4.

Developing warehouse
technology

5.

National Horticultural Clearing


House: scaling up a model

IV. CONCLUSION
1. The numbers of the poor have increased
both absolutely and proportionally, the distance
below the poverty line has also intensified. The
main factor causes the rural poor is
commodities market fluctuating prices. The
market fluctuations have adversely affected the
rural poor.

2. Farmers must prepare one solution to surpass


the fluctuating price which the solution exists in
farmers side. the solution uses a method of
commodity pawning. If the market situation
happes the bad price, the farmers can pawn the
commodity. If a moment the good price will
happen, the farmers receive the rest of the money
that depends on the last price. In research the
mechanism of pawning in horticulture
commodities is defined as the logistics receipts

3. For logistics receipts, the farmers need a


legal business organization/cooperative. The
legal business organization is needed because a
prerequirement of banking system to be
collaborating in the payment /collateral system.
The farmers can organize from the farmers
group to the cooperative.