Financial Analysis of Sweet Potato Farming in Gunung Talang Region, West Sumatra, Indonesia

Abstract

West Sumatra province has three sweet potato’s central regions, one of its is in Solok regency which is named Gunung Talang region. Farmers in this region have planted sweet potato for a long time as a secondary crop in lowland after lowland rice being harvested. Some of them planted sweet potato in upland. Sweet potato farming is an important source of income for the farmers. We have conducted a survey research in Gunung Talang region from September to November 2018. The objectives of research were to overcome the value of inputs and output of local sweet potato farming, and to analyze the farmers’ sweet potato farming locally and financially. We used a purposive sampling method to select the farmers’ organizations to be surveyed considering the large area of its members’ sweet potato farming. The research respondents were the members of four farmers’ organizations (Karya Tani 36 members, Batu Data 36 members, Karya Sari 32 members, and KWT Karya Tani 24 members). The primary data were collected through direct interview with the respondents and direct observation to their sweet potato farming. The secondary data were found through related institutions, i.e. West Sumatra Assessment Institute for Agricultural Technology, Agricultural Office of Solok regency, and Extension Office of Gunung Talang district. Results showed that the real total cost of the farmers’ sweet potato farming in Gunung Talang region was IDR 12,358,655 per hectare. This cost would increase into IDR 24,635,564 per hectare if we calculated the land revenue, interest on working capital, depreciation, rent paid for leased land, and inputed value of family labor. The average yield of the farmers’ sweet potato farming was 22,550 kg per hectare and its price was IDR 2,300 per kg so that the total revenue was IDR 51,865,000 per hectare per planting season. The gross income gained by the farmers from sweet potato farming per hectare per planting season in Gunung Talang region was IDR 39,506,345 and the net income was IDR 27,229,436 with R/C ratio 2.08, and B/C ratios based on full cost basis and cash cost basis were 1.11 and 2.20, respectively. It showed that the sweet potato farming in Gunung Talang region, West Sumatra, Indonesia was financially profitable and might have been a main source of income for the farmers.