1
ONION AGRIBUSINESS DEVELOPMENT STRATEGY AS A
SUPERIOR COMMODITY IN BOYOLALI DISTRICT
Introduction:
The agricultural sector contributes greatly to national development not only as a
provider of employment, but also plays a role in increasing the country's foreign exchange
earnings, value-added income and competitiveness, meeting domestic consumption needs and
industrial raw materials, and to support the optimization of sustainable natural resource
management (Kusumaningrum 2019). Indonesia itself is known as an agricultural country
because most of its people work in the agricultural sector, these conditions make Indonesia
rely on the success of its farmers in supporting national food security (Suratha 2013). The
diversity of agricultural products in Indonesia includes plantation crops, food crops,
horticulture, industrial crops, and several products that are unique and have the opportunity to
be developed (Pitaloka 2017). Based on these conditions, the development of the agricultural
sector is certainly very important for the fulfillment of domestic needs and to improve the
welfare of the Indonesian people.
One of Indonesia's agricultural commodities that has the potential to be developed is
shallots. Shallots are a horticultural commodity that is prioritized by the Director General of
Horticulture and the Ministry of Agriculture for several reasons, including the demand for
shallots that continues to increase from time to time, very volatile prices, one of the
commodities that contribute greatly to inflation, and a source of income for farmers
(Nurhayati et al. 2022). This commodity is also included in the high value commodity so that
many farmers are cultivating it (Aldila et al. 2017). The national average selling price of
shallots in October 2022 reached IDR 35,450/kg (PIHPS).
Shallots (Allium cepa L.) are annual plants that can be grown in lowlands and highlands
which have several parts including layered bulbs, fibrous roots, and hollow cylindrical leaves.
Onion plants can be harvested after 70-80 days of age, with the most utilized part being the
bulb. There are also culinary traditions that utilize the leaves and flower stalks as seasoning.
Two types of shallots are grown, namely local onions or medium-sized Javanese onions and
non-local onions. Local onions or Javanese onions consist of several types, including: bima
curut onions, sidapurna onions, tablet onions, darkonah onions, sirad onions, juna onions,
probolinggo onions, parman onions, yellow onions, blue-field onions, and blue-sand onions.
Different from local onions, non-local onions commonly called bangkok onions have a large
size and multiply (Ministry of Trade RI 2013).
According to Songi et al. (2018), shallots are a commodity that is often used as a
kitchen spice or flavoring, and as medicine by the community. These uses make the demand
for shallot commodities will continue to increase as the population increases, which causes
the need for food to also increase. Household consumption in Indonesia itself of shallots has
experienced
The high demand for shallots that is not supported by stable supply can cause price
fluctuations over time due to the gap between supply and demand (Dewi and Sutrisna 2016).
The inability to meet the demand for shallot supply through domestic production makes
imports a viable solution. The relationship between domestic production and import demand
is negative so that to reduce shallot import demand, it is necessary to increase domestic
production (Pasaribu and Daulay 2013). The existence of shallot imports themselves if not on
target can be a threat to domestic shallot farmers. When farmers experience losses due to
falling local shallot prices due to imported shallots, it is feared that the ability and interest of
farmers in increasing shallot production will also decline.
A development strategy for shallot commodities is needed to reduce import levels due
to the opportunity for high shallot demand. The government has issued several policies to
support shallot development such as fertilizer subsidy policies, credit interest subsidies, and
fuel oil subsidies (Aldila et al. 2017). Onion self-sufficiency is the government's goal in
meeting domestic needs, which has shown success by reducing the volume of shallot imports
by 93% or as much as 16,210 tons in 2016. Onion import-export data are presented more
fully in Table 1.
Based on national vegetable crop production data in 2021, the shallot commodity has
the highest production amount, which is 2,004,590 tons (BPS 2022). Shallot production itself
has a much higher value than garlic production which only reaches 45,092 tons (BPS 2022).
In Table 2 from 2015 to 2021 shallot production continues to increase, indicating that shallot
self-sufficiency has been realized. The increase in production has also made Indonesia able to
export to several countries such as Thailand, Singapore and Malaysia.
The increase in shallot production is inseparable from the contribution of production
centers in Indonesia, including the provinces of Central Java, East Java, West Nusa Tenggara
(NTB), West Sumatra, and South Sulawesi. Central Java Province is capable of producing
564,255 tons of shallots in 2021 (BPS 2022). Some of the areas in Central Java with the most
shallot production are Brebes, Demak, Pati, Grobogan, Boyolali, and Kendal districts which
can be seen in Table 3.
Boyolali Regency as one of the centers based on Table 3 shows an increase in harvest
area every year, reaching 3,151 ha in 2020. Harvest area is the result of multiplying the land
area with planting intensity (Hasan 2010). Despite the increase in harvested area, shallot
production in Boyolali Regency tends to fluctuate and even increase. A decrease of 83,313
kw in 2020 can be seen in Table 3. A comparison of the national average productivity and the
central regions in Central Java can be seen in Table 4, where Boyolali has a productivity of
3.2 tons/ha in 2020. This condition shows that shallot productivity in Boyolali is still far
below the national average of 9.71 tons/ha and is the lowest compared to the other 5 central
regions in Central Java in 2020 as shown in Table 4.
One of the causes of the fluctuating productivity problems in the farming subsystem is
the absence of certified seed producers, which is the upstream subsystem in the area. This
constraint makes farmers still use seeds produced that are not certified seeds, so they are not
in accordance with GAP (Good Agricultural Practices) guidelines. According to Theresia et
al. (2016), the constraints faced by the shallot seed business include the need for a lot of
capital and a large area and warehouse, the level of knowledge and ability of human resources
is still low in producing seeds, the shelf life of shallot seeds which only reaches 2-5 months,
and seed storage problems.
Not only in the use of seeds, but there are also farmers who still use chemicals such as
detergents in pest control, which is certainly not in accordance with GAP guidelines because
it can damage the ecosystem of cultivated land. Good Agricultural Practices (GAP) itself
directs that agricultural production be carried out in an environmentally friendly and
sustainable manner, with the aim that the products produced are safe for consumption, and of
course provide welfare for farmers. So it is important to pay attention to GAP (Good
Agricultural Practices) guidelines so that agricultural activities can run optimally.
The influence that occurs between farming and upstream subsystems shows the
relationship between subsystems in the shallot agribusiness. According to Krisnamurthi
(2020), based on the view of the agribusiness system, the performance of each activity in the
system including the performance of the onfarm subsystem will be determined by other
subsystems. Based on the calculation of projected per capita shallot consumption in Boyolali
in 2020 the consumption reached 232,128 kw, while shallot production in Boyolali only
reached 100,120 kw in 2020 which can be seen in Table 3. This condition shows that
production in the area has not been able to meet its needs, and indicates the presence of
shallots from other regions to meet its demand. Therefore, it is necessary to prioritize
agribusiness development strategies shallot that aims to increase its productivity, by
formulating based on internal and external factors that can affect it.
1.1 Problem Formulation
Boyolali Regency is one of the shallot production centers in Central Java Province. The
establishment of Boyolali District as a center was due to the government's seed assistance of
the batu ijo variety in 2016, which gave abundant results that year. This condition shows that
seeds as one of the inputs in the onion agribusiness play an important role. According to Aziz
et al. (2013), seeds contribute to the success of crop production, seeds also cannot be replaced
by other means.
Shallots (Allium cepa L.) have become the main vegetable horticultural commodity
cultivated in Boyolali Regency. This is supported by data showing the harvest area of shallot
commodities which continues to increase every year as shown in Table 3. However, in 2020
when there was an increase in the harvest area of 1,107 ha, the production decreased by
83,313 kw. Based on BPS data from 2018 to 2020 regarding the harvest area and shallot
production in Central Java Province, it can be seen that Boyolali Regency experienced the
highest decrease in productivity compared to the other five districts/cities in 2020, which
decreased by 63% from its productivity in 2019.
The problems of low shallot productivity, fluctuating prices, and poor processing in the
shallot industry are indeed the main problems in the development of shallot farming
(Andayani 2017). According to the Boyolali District Agriculture Office, the problem that
hampers shallot production targets is the absence of certified shallot seed producers in
Boyolali District (LKJIP 2018). In developing the seed business, there are several obstacles
such as considerable capital, the need for large areas and warehouses, knowledge and skills of
human resources regarding seed production, and the fulfillment of seed quality standards with
the intensity of major pest attacks only 0-0.5%.
According to Rijal et al. (2016), the variables that affect shallot production in their
research location are capital, land area, fertilizer, seeds, and labor variables. The existence of
capital, fertilizer, and seed variables shows that the success of production does not only
depend on the on-farm subsystem, but depends on the entire subsystem in agribusiness.
According to Krisnamurthi (2020), based on the system view, the performance of each
activity in the agribusiness system, including on-farm performance, will be determined by its
relationship with other subsystems. The agribusiness system is conceptually all activities
starting from the procurement and distribution of production facilities to the marketing of
products both produced by farming and agro-industry subsystems that are interrelated with
each other (Agribusiness Agency 1995). The agribusiness system consists of upstream
subsystems, farming subsystems, downstream subsystems, and supporting subsystems.
High national demand for shallots on a national scale, where household shallot
consumption in Indonesia alone in 2021 has reached 790,630 tons/year (BPS 2022), if not
balanced with sufficient domestic production, it will cause discontinuity. Awareness of the
opportunity for high demand for shallot commodities and for the sake of maintaining national
food security is the basis for conducting research on the priority of shallot agribusiness
development strategies in Boyolali Regency.
1.1 Problems in Onion Agribusiness
Although national production has increased every year as can be seen in Table 2, in
reality there are certainly still problems that occur in the shallot agribusiness. Given the
importance of shallot commodities that cannot be substituted with other commodities, it is
important to know the problems that occur in the shallot agribusiness. When discussing the
shallot agribusiness, the problems analyzed can come from all agribusiness subsystems. In
the upstream subsystem, one of the problems that occurs is the low production of national
shallot seeds. The problem is because the shallot seed business requires a large capital and
warehouse area, the knowledge and skills of human resources are still low in seed production,
low storability, and farmer skills have not supported the application of seed innovations in the
form of seeds (Theresia et al. 2016). Seed innovation in the form of seeds is called TSS (True
Shallot Seed). Based on research conducted by Novianti et al. (2020), shallot farmers in
Cilawu District, Garut Regency who apply TSS technology are still relatively low or around
5% because farmers are still weak in accessing information and applying new technology.
Farmers also complain about the relatively expensive price of seeds and fertilizers
(Darmawan 2018).
In research conducted by Rahmadona et al. (2017) the problems that occur in
Majalengka Regency are farming activities that have not been implemented properly. This
condition is caused by farmers who can only produce shallots seasonally, production cost
constraints, and fluctuating shallot prices. According to Kurniati (2019), the internal
problems faced by shallot farming consist of lack of ability in applying technology, narrow
land tenure, limited capital, and limited inputs. On the other hand, factor problems include
erratic climate, pest attacks (Plant Disturbing Organisms), and fluctuations in shallot prices.
The issue of seasonality is also experienced by shallot farmers in Boalemo Regency,
where changes in natural conditions pose a threat to farmers because erratic natural
conditions prevent farmers from determining their planting time, farm management, and post-
planting (Songi et al. 2018). According to Santoso (2016), climate change can affect the
decline in production directly, and can indirectly reduce the productivity of food crops due to
increased attacks of pests and plant diseases. The next problem in shallot agribusiness is
about shallot damage such as the presence of porous and mold. The damage is due to post-
harvest techniques that are still conventional, namely in the process of storage, drying, and
packaging in distribution (Septiana et al. 2017).
Agribusiness subsystems are interconnected with each other, making problems in one
subsystem can affect other subsystems. Other. Previously, it was mentioned that in previous
studies farmers faced capital problems. This problem is due to the limited presence of
financing institutions in each village, the procedures and conditions provided tend to be
difficult, and the high interest rates (Farianto et al. 2021).
1.2 Internal and External Factors
Previous research on regional development strategies conducted by Fatonny (2021)
examined seaweed business development strategies in Takalar Regency, South Sulawesi
Province. In formulating the seaweed development strategy, the research first analyzed the
internal and external environment. According to Fatonny (2021), the internal environment is
the factors that influence business activities directly and exist within the scope of the business
itself. The research explained that the internal factors of seaweed businesses that included
strengths and weaknesses were identified using a functional approach consisting of aspects of
production, human resources, marketing, finance, technology, and institutions. The external
environment analysis conducted to determine the opportunity and threat factors was analyzed
using a macro-environmental approach. The approach identifies based on several aspects
including: (1) political, government, and legal aspects, (2) social, cultural, and environmental,
(3) economic, and (4) technology and information.
Research related to development strategies in shallot business in Malumbi District
conducted by Wadu and Linda (2020) identified internal factors with indicators of resources,
finance, management, and technology. The results of the study stated that the strengths
consisted of self-owned land, adequate water availability, a favorable climate, farmer
institutions that were considered good, and appropriate post-harvest supervision (Wadu and
Linda 2020). Weaknesses include limited capital, limited superior seeds, an unoptimal
marketing system, low quality of human resources, limited mastery of technology, and
dependence on chemical inputs (Wadu and Linda 2020). Similar to research conducted by
Suciati et al. (2022), capital is a weakness faced by shallot farmers in carrying out their
activities. According to Wadu and Linda (2020), the analysis of external factors was
identified using economic indicators, government, natural factors, and external factors. The
results of his research are the opportunities of the shallot business including high demand,
fairly high shallot prices, the existence of capital from financial institutions, cooperation with
many parties, and close access to the market. Market demand for shallot commodities is also
an opportunity that is owned in research conducted by Suciati et al. (2022). High market
demand is an opportunity that must be pursued, on the other hand, so that market demand can
be met without shallot imports. The results of research conducted by Wadu and Linda (2020),
show the threats that are potentially faced in shallot commodities, namely competition in
selling price fluctuations, increasing input prices, pest attacks, and shallot competitors from
outside the island. Pest and plant disease attacks are also influenced by weather changes.
According to Servina (2019), in shallot and chili plants, the intensity of rainfall is high.
1.3 Formulation of Development Strategy
Much research has been conducted on agricultural commodity development strategies.
The strategy formulation process certainly requires a certain approach to be able to consider
various factors that can affect the development goals to be achieved.
Research conducted by Kusumayana and Redhanie (2016), Songi et al. (2018), and
Manoppo et al. (2021) used the same approach, namely IFAS (Internal Factors Analysis
Summery), EFAS (External Factors Analysis Summery), and SWOT (Stengths, Weaknesses,
Opportunity, and Threats). The formulation of development strategies needs to consider
various internal and external factors that can influence the development strategy to be carried
out. The use of the IFAS matrix in this research is a stage that aims to categorize internal
factors into strengths and weaknesses, while the use of the EFAS matrix to map external
factors into opportunities and threats. The next method used after knowing the internal and
external factors is SWOT. This method is used to match and develop four types of alternative
strategies, namely strength-opportunity (SO) strategies, weakness-opportunity (WO)
strategies, strength-threat (ST) strategies, and weakness-threat (WT) strategies.
Previous research related to development strategies was also carried out with other
methods, namely using the AHP (Analytic Hierarchy Process) method. The method was used
by Jumna (2015) in his research on farm development strategies in an effort to increase
organic rice production. The AHP (Analytic Hierarchy Process) method is used to determine
the priority of programs in development efforts so that it requires several parties who are
considered competent (key-persons) in determining alternative development strategies. When
applying the method, he determined several criteria, including cultivation criteria, input
criteria, institutional criteria, and post-harvest criteria. These criteria are then used as a
reference in determining alternative development strategies.
The formulation of development strategies using other methods was carried out by Lee
et al. (2021) his research uses the A'WOT method which is an application of the SWOT and
AHP methods. The limitation of SWOT analysis is that each factor cannot be measured
quantitatively, so combining it with AHP makes it possible to obtain a more appropriate
strategy. According to Fatonny (2021), the use of the A'WOT method in strategy formulation
can produce a framework that is effectively applied in various conditions.
1.4 Alternative Commodity Development Strategy
Alternative commodity development strategies are several strategies that have been
formulated through consideration of internal and external factors. Research related to
previous development strategies certainly has different factors even though the commodities
developed are the same. Therefore, each research provides its own alternatives according to
the factors that influence its development strategy. In the research conducted by Suciati et al.
(2022), through the SWOT method compiled several alternative strategies for developing
shallot commodities. Strategies derived from strength and opportunity factors consist of
increasing shallot production and quality, utilizing farmer experience by using advanced
technology, and utilizing infrastructure by using superior and certified seeds. The availability
of quality seeds in sufficient quantities, on time, and easily accessible to farmers has a very
important influence (Wulanjari and Setiani 2018).
The strategy also considers existing weaknesses and opportunities, one of which is to
reduce farmers' dependence on the high use of chemical fertilizers (Suciati et al. 2022).
Guidelines for the use of fertilizers themselves have actually been established in GAP (Good
Agricultural Practices), both in terms of the type of fertilizer, dosage, and timing of fertilizer
application. Research conducted by Afrizal et al. (2019), conveyed that one of the alternative
strategies in the development of shallot commodities is to encourage farmers to become
shallot seed breeders. Based on these strategies, it can be seen that input factors from the
upstream subsystem play an important role in agribusiness activities, especially in the
farming subsystem. The role of inputs in supporting the achievement of production targets
itself cannot be replaced by other factors.
Theoretical Framework
1.1.1 Agribusiness Concept:
Agribusiness is a series of systems from efforts to procure agricultural production
facilities, farming, post-harvest business, sorting, storage and packaging of products;
agricultural product processing industry, and product distribution business to consumers;
including supporting institutions, such as capital institutions, information service institutions,
and government agencies (Krisnamurthi 2020). According to Arifin and Biba (2018), the
definition of agribusiness in a broad sense is a business unit that includes a chain of
production, processing and marketing of products with the aim of obtaining profit (profit
oriented).
Agribusiness indicates a vertical relationship between agribusiness subsystems and
horizontal relationships with other systems or subsystems, such as financial services,
banking, transportation, trade, and education (Saragih 1995). Quoted from Suryana (2010)
according to Drillon (1971), the vertical structure of the agribusiness system includes
marketing, processing, production, agricultural inputs, research and extension, and
development policies and programs. Therefore, to be able to develop agribusiness well,
technological research support is needed, as well as effective and efficient technology
extension to the parties who need the technology.
The agribusiness system, according to Krisnamurthi (2020), includes four subsystems,
including: (1) up-stream agribusiness subsystem,
(2) on-farm agribusiness subsystem, (3) down-stream agribusiness subsystem, (4) supporting
services subsystem. According to Rahim and Hastuti (2005), the up-stream agribusiness
subsystem is a subsystem that includes industrial activities and trade in primary agricultural
production facilities including the agro-chemical industry (fertilizers and pesticides), the
agro-automotive industry (agricultural equipment such as tractors), and the hatchery and
nursery industry. The production subsystem (on-farm agribusiness) is a subsystem that
includes farming activities by utilizing production facilities from the upstream subsystem to
produce primary agricultural commodities (Rahim and Hastuti 2005). Furthermore, the down-
stream agribusiness subsystem is the activity of processing agricultural products into
processed products along with marketing activities both in domestic and international
markets (Krisnamurthi 2020), while the supporting system, according to Rahim and Hastuti
(2005), includes financial services such as banking, infrastructure (infrastructure and
facilities), research and development, food extension workers and consultants, food
information services, and government policies.
Agribusiness development is also a must that needs to be done on the basis of
awareness of the level of welfare of farmers as producers of basic needs products with a clear
market that is still lagging behind (Krisnamurthi 2020). The linkages between agribusiness
subsystems make the development carried out not only focus on the farming subsystem, but
must pay attention to all agribusiness subsystems. According to Suryana (2010), the success
of agribusiness development is highly dependent on the success of each interrelated
subsystem.
1.1.2 Strategy Concept
Strategies are potential actions that aim to achieve long-term objectives because they
can affect well-being. Strategies can have multifunctional or multidimensional consequences,
requiring consideration of both internal and external factors (David 2015). Therefore, the
initial stage of strategy formulation is to identify internal factors and internal factors that can
influence the development strategy. According to Betz (2016), strategic thinking is an effort
to prevent and realize the expected future in the long term through a series of short-term
actions. According to Widayanto (2020), strategic management tries to deal with changes in
the internal and external environment which will then be attempted to adjust steps in order to
achieve goals. Based on several definitions of strategy, it can be understood that a company or
organization needs a strategic plan that considers its internal and external factors. Strategy
plays an important role in dealing with changes that occur in the future, and plays a role in
realizing the expected long-term goals.
1.1.3 Internal and External Environmental Analysis
When designing a development strategy, it is necessary to analyze factors originating
from the internal and external environment to determine strengths, weaknesses, opportunities,
and threats. Analysis of internal factors can be identified based on aspects of production,
human resources, marketing, finance, technology, and institutions in agribusiness subsystem
activities, including: (1) input procurement (seeds, fertilizers, capital, and other inputs), (2)
on-farm production processes (land resources, human resources, technology, and
management), (3) off-farm production processes (processing of agricultural products,
partnerships and storage), (4) marketing and distribution processes (price and quality), (5)
supporting services (R&D, finance).
This research will formulate priority development strategies in a region so that the
perspective to be used is macro agribusiness. Analysis with a micro point of view is not
appropriate when used to analyze the level of agribusiness society. At the macro level, the
observation of the agribusiness community refers to the social processes related to the
authority of the allocation and distribution of resources and funds (Agribusiness Agency
1995). Based on the analysis of the macro perspective, external factors in this study will be
identified using factors that affect the agribusiness system. In the macro framework of the
agribusiness system, the agribusiness system is influenced by economics, politics, socio-
culture, defense, and technology both regionally, nationally, and internationally (Andayani
2017). Considering that agricultural commodities have special characteristics, namely
varying quality, external factors that can affect other factors are factors that can affect the
agribusiness system Environment. According to Andayani (2017), climate, weather, and
natural events (floods, pest and disease attacks), can affect product quality so that in
analyzing the external environment, the PESTEL (political, economic, sociocultural,
technological, ecological, legal) framework can be used.
1.1.4 A'WOT Analysis
A'WOT analysis is a combination of AHP (Analytic Hierarchy Process) and SWOT
(Strengths, Weaknesses, Opportunities, Threats). SWOT is used to obtain a basic framework
which will then be analyzed using AHP so that it can be more analytical (Kangas et al. 2001).
SWOT has become one of the methods often used in designing development strategies
through analyzing internal and external factors that influence a development strategy. Internal
factors consist of strengths and weaknesses, while external factors include opportunities and
threats. Strengths contribute to improving overall performance and creating profits, while
weaknesses affect efficiency, profitability and competitive advantage. Opportunities are the
probability of exploiting or increasing additional profits, while threats can provide difficulties
and frustrate the development and implementation of any strategy (Bottero et al. 2020). The
use of SWOT analysis aims to obtain an appropriate basis for formulating development
strategies that are in accordance with existing internal and external factors. However, SWOT
analysis cannot measure the overall strategic decision-making situation (Kangas et al. 2001).
Therefore, AHP is needed that is able to measure the weight of the importance of each
internal and external factor and measure the weight of the strategic importance that will later
be selected (Hozairi et al. 2020).
Through AHP, effective decision-making can be expressed because the existing
problems will be resolved using a structured framework. AHP developed by Dr. Thomas L.
Saaty in the 1970s organizes decision making into a multilevel diagram (hierarchy) with the
top position being the goal or objective of success, then the first level of criteria, sub-criteria
and finally alternatives. There are several advantages of using the AHP method, including
being able to describe the decision-making process in graphical form so as to facilitate the
understanding of the parties involved. AHP is also able to simplify the decision-making
process and measure the consistency of the weighting given if there are deviations whose
value is far from the perfect consistency value, which must be 10% or less (Marimin 2017) so
that the purpose of applying the A'WOT method in the strategy formulation process is to
increase quantitative information, such as solving priority, selection, and evaluation problems
(Kisi 2019).
1.2 Operational Framework
This research was conducted with the aim of obtaining prioritized strategies for
developing shallot agribusiness in Boyolali Regency with using the A'WOT method. The
objective is based on the problem of decreasing productivity when the shallot commodity
itself has the opportunity for high market demand and has a high selling value. This research
stage begins with identifying factors from the internal and external environment through
interviews with shallot farmers, farmer group leaders, cooperative leaders, local shallot
processing businesses, and traders or other marketing parties. Furthermore, discussions were
held with respondents who were considered capable of assisting in identifying internal and
external factors. Internal factors consist of strengths and weaknesses, identified by
considering each subsystem in the shallot agribusiness which is the internal environment.
External factors including opportunities and threats can be identified based on the PESTEL
framework (political, economic, sociocultural, technological, ecological, legal). These
factors become the basis for formulating development strategies using A'WOT, which is a
combination of the AHP (Analytic Hierarchy Process) and SWOT methods.
4.1.1 FGD (Focus Group Discussion)
FGDs are the next step in collecting information related to the overview, as well as
internal and external factors that affect the development of shallot agribusiness. Unlike
interviews where researchers will directly ask questions to respondents one by one, in FGDs
researchers will ask questions to a group and conduct discussions. This research conducted
several FGDs with different parties, including: (1) FGD with 10 members of the
Margomakmur farmer group accompanied by representatives of BPP (1 time), (2) FGD with
4 representatives of BPP Cepogo District (2 times), (3) FGD with 4 representatives of the
Agriculture Plantation and Forestry Office of Boyolali Regency (3 times).
4.1.2 Filling out the A'WOT Questionnaire
Based on the FGD results, a SWOT matrix was compiled and discussed with
academics, the Agriculture Plantation and Forestry Office of Boyolali District, and BPP
Cepogo District. The matrix was then organized into an A'WOT hierarchical structure
consisting of objectives, criteria (factors), sub-criteria (subfactors), and alternatives
(alternative strategies). In accordance with the stages of the A'WOT method itself, the
hierarchical structure is then organized into an A'WOT questionnaire to carry out weighting
by means of pairwise comparisons at each level.
4.2 Respondent Determination Method
Respondents in this study are the parties involved (stakeholders) in designing shallot
agribusiness development strategies in Boyolali Regency. The selected respondents are
considered to have the ability and expertise to provide information and participate in the
preparation of shallot agribusiness development strategies. This study involved 20
respondents consisting of farmers (10 respondents), farmer group leaders (1 respondent),
processing businesses (1 respondent), marketing parties (1 respondent), BPP Cepogo District
(4 respondents), Boyolali District Agriculture Plantation and Forestry Office (4 respondents),
and academics (1 respondent).
4.3 Data Analysis and Processing Methods
The method of data analysis and processing in this research will use the A'WOT (AHP-
SWOT) method which can utilize the Super software. Decisions 3.2 in data processing. In the
initial stage, SWOT factors will be identified, namely internal and external factors through
literature studies to obtain secondary data, and direct observation and interviews to obtain
primary data. Internal factors consist of strengths and weaknesses, while external factors
include opportunities and threats. Based on the results obtained, the SWOT matrix was then
compiled. The SWOT matrix is then organized into an A'WOT hierarchical structure
consisting of several levels, namely (1) goals or objectives to be achieved, (2) criteria or
SWOT factors (strengths, weaknesses, opportunities, and threats), (3) subcriteria occupied by
subfactors of SWOT, and (4) alternative strategies. The stages of A'WOT analysis according
to Kangas et al. (2001) are as follows:
4.3.1 Determination of Internal and External Factors Using SWOT
Analysis Internal and external factors that influence strategy shallot agribusiness
development was analyzed using SWOT analysis. Given that the analysis method used is AHP, the
number of sub-factors in each SWOT must be less than 10 (Bottero et al. 2019). Internal factors
(production, human resources, marketing, finance, technology, institutions) based on the agribusiness
system are grouped into strengths and weaknesses. The external factors (political, economic, socio-
cultural, technological, environmental, and legal) are grouped into opportunities and threats.
4.3.2 Formulation of alternative strategies with SWOT matrix
This stage is the formulation stage using the SWOT matrix. This formulation is carried
out to formulate strategies that pay attention to strengths, weaknesses, opportunities, and
threats.
4.3.3 Compilation of A'WOT Hierarchy Structure
The SWOT factors that have been obtained are then arranged in an AHP (Analytical
Hierarchy Process) hierarchical structure so that they become the A'WOT hierarchical
structure.
4.3.4 Pairwise comparison with AHP method
After the A'WOT hierarchical structure is arranged, pairwise comparisons are made
between each SWOT (strengths, weaknesses, opportunities, threats) factor (criteria). This
comparison is carried out to determine the weight that shows the level of importance or
influence of each factor in its SWOT group. This stage is carried out following the provisions
SWOT hierarchy, namely pairwise comparison between factors (criteria) first, pairwise
comparison of subfactors in SWOT groups, and pairwise comparison of alternative strategies
based on each SWOT subfactor.
a. Expert questionnaire completion
In accordance with the requirements of the AHP method where the weighting in
pairwise comparisons is an expert, the filling is only done by several experts who have been
selected. The form of the pairwise comparison questionnaire questions is shown in Figure 5.
The pairwise weighting will be asked using a questionnaire that applies Saaty's comparison
scale. According to Saaty (1983), in the book written by Marimin (2017), a scale of 1 to 9 is
the best scale in giving opinions can be seen in Table 4.
5.1
Overview of the Research Location
Boyolali Regency is one of 35 regencies in Central Java Province located between 110°
22' - 110° 50' East Longitude and 7° 7' - 7° 36' South Latitude. Boyolali Regency has an area
of 101,510.20 ha which is at an altitude between 75 - 1500 meters above sea level with a
topography of lowlands accompanied by hills and mountains. These conditions make the soil
quality in Boyolali very fertile and has the potential to become one of the food barns in
Central Java.
Boyolali Regency, which is known as the "city of milk", actually has another potential
sector, namely the agricultural sector. The total labor force in Boyolali alone in 2018 reached
545,227 people and was dominated by the agricultural sector with 173,924 people (BPS
2019). Boyolali Regency is also included in the top six shallot center areas in Central Java
Province, with a production of 100,120 kw in 2020 (BPS 2021). The shallot commodity is the
main vegetable horticultural commodity in Boyolali Regency besides cabbage, chili, and
tomatoes. Based on data from BPS Boyolali District, of the 19 sub-districts that produce the
most shallots, Cepogo Sub-district can be seen in Table 6.
5.2
FGD (Focus Group Discussion) Results
Based on the results of FGD (Focus Group Discussion) which aims to determine
internal factors and external factors, some information is obtained that can be taken into
consideration. FGD itself is conducted with parties related to the design of shallot
agribusiness development strategies in Boyolali Regency. The results of the FGD discussion
can be grouped into each SWOT factor (strengths, weaknesses, opportunities, and threats), as
follows:
5.2.1 Strengths
Based on the results of the FGD (Focus Group Discussion) on the strengths factor,
several factors were presented as strengths or supporters in the success of shallot agribusiness
in Boyolali Regency. The first strength is that shallots are the main vegetable horticultural
commodity of Boyolali Regency. This condition is supported by the harvest area which
increases every year and the cultivation land in Boyolali which is in the form of highlands
suitable for cultivating the batu ijo variety of shallots. Human resources are also a strength,
considering that the majority of the population work as farmers. Farmers are also considered
experienced in cultivating shallots because shallot farming activities themselves have been
carried out for generations even though they still use simple and traditional cultivation
techniques. Some local shallot farmer groups have also conducted joint activities at least once
a month with the aim of improving the welfare of shallot farmers. The farmer groups have
also been able to produce seeds independently, but unfortunately have not met the
requirements of quality seeds with certification. Although they have experience in carrying
out shallot cultivation activities, it does not mean that farmers are closed to the development
of existing technology and knowledge. Farmers are very open and willing to apply the
knowledge and cultivation techniques provided through counseling and training. Strengths in
marketing itself from the farmers' side said that one of the strengths is the presence of
collective traders. Through collective traders, farmers can easily sell their agricultural
products, and are able to save transportation costs incurred when marketing them outside the
region independently. The increasing number of collective traders will also increase the
selling price at the farm level.
5.2.2 Weaknesses
There are several factors that become weaknesses in the shallot agribusiness in Boyolali
based on the results of the FGD (Focus Group Discussion) conducted. The first weakness is
that there are currently no certified seed producers or providers in the area. This condition
makes farmers have to buy shallot seeds of Batu Ijo variety from Batu Malang area. Farmers
also still use seeds from the first harvest, which may not meet the quality of certified seeds.
Seed itself is an input that holds Onion seeds play an important role in achieving production
targets, which has been explained in GAP (Good Agricultural Practices) regarding the
determination of proper seed selection. The weakness is due to the obstacles faced in the
development of shallot seed business, including large capital, the need for large land and
warehouses, and the requirements of certified seed criteria which are still relatively difficult if
farmers do it without assistance from the government. Problems regarding the absence of
seed producers or seed businesses that are part of the upstream subsystem have an influence
on the farming subsystem.
Due to the use of uncertified seeds and not in accordance with GAP guidelines, shallot
productivity in Boyolali district tends to fluctuate. In 2020, the shallot productivity was only
3.2 tons/ha, whereas in the previous year the productivity was 8.6 tons/ha. The decline can be
observed in Table 4. Of course, this is also a weakness in the shallot agribusiness in Boyolali.
Not only the problem of seeds, in the eradication of pests sometimes there are still farmers
who use chemicals that are not recommended. So it can also be seen that the application of
GAP (Good Agricultural Practices) is still relatively weak.
Onion farming activities are also still classified as simple and traditional, one of which
is that farmers still have difficulty accessing capital assistance. In fact, the government also
feels constraints in the distribution of capital assistance such as inputs, because there are still
many farmers who have not been registered in SIMLUHTAN (Agricultural Extension
Management Information System). The government hopes that farmers can be incorporated
into a registered farmer group so that the provision of assistance can be done evenly.
The high demand for shallots that occurs throughout the year should be balanced with
production, but the existing weaknesses are the obstacle. Currently, farmers are still
dependent on certain seasons due to the condition of the land in the highlands, so the
irrigation system still relies on a rainfed system. Farmers in Boyolali themselves conduct two
planting seasons a year, the first in October and the second around March. Production that
cannot be done throughout the year in addition to affecting household consumer demand, also
affects the processing industry. The processing industry must take shallots from other regions
if the region cannot meet its demand.
Other weaknesses also arise from the downstream subsystem, one of which is the
processing industry. The number of processing industries in Boyolali is still limited, this is
because farmers feel that their products can be sold quickly in the form of fresh products.
Whereas processing raw products into processed products such as fried shallots, shallot paste,
and shallot oil can increase the selling value of the product. The limited number of shallot
processing businesses makes it so that during the peak harvest season fresh shallot production
sometimes cannot be absorbed properly, causing the selling price in the peak harvest season
to often decline. In terms of the processing industry, it is also still constrained in processing
of licenses such as P-IRT (Home Industry Food Production Certificate). The obstacle is due
to the absence of counseling related to product processing, especially fried shallots, to meet
the criteria of the P-IRT itself.
5.2.3 Opportunities
Based on the results of the FGD (Focus Group Discussion) conducted, one of the
opportunities that is also an attraction for farmers in cultivating shallot commodities is the
high demand for shallots. In 2021, household consumption in Indonesia of shallots even
reached 790,630 tons/year, the data is shown in Figure 1. Farmers also feel that the shallot
commodity is more profitable than the tobacco commodity. The tobacco commodity itself is a
commodity that is planted in crop rotation, although shallots are considered more profitable,
the crop rotation is still important to break pests and plant diseases.
As a major vegetable horticultural commodity, shallots have a budget for its
development sourced from the APBN-TP or Assistance Task funds from the State Budget, as
well as the APBD or Regional Budget. Shallots are also included in the nine commodities
that receive fertilizer subsidy assistance which is currently limited to only two types of
fertilizers, namely urea and NPK, this is stipulated in MOA Number 10 of 2022.
Onion agribusiness development opportunities are not limited to fresh products, with
the development of onion processing technology such as vegetable washer machines, dewater
machines, and onion machines. With the development of processing technology, it will
facilitate the processing of products that have added value. Apart from the technological side,
another opportunity is the guidance of processing technology from the Directorate of
Processing and Marketing of Horticultural Products. Through these guidance activities will
increase knowledge and expertise in processing shallot products. However, unfortunately,
guidance activities regarding the processing of shallot products are still very limited, which is
also a problem.
5.2.4 Threats
The threat factor known based on the results of the first FGD (Focus Group
Discussion) is about shallot imports. On this issue, there are different opinions from several
parties. There are parties who convey their anxiety due to the threat of imports, but on the
other hand there are parties who say that there are no imports because the demand in the area
has been met. If the projected calculation of shallot consumption per capita in Boyolali in
2020 reaches 232,128 kw where the population is 1,052,832 people, while shallot production
in Boyolali only reaches 100,120 kw in 2020 which can be seen in Table 3. The projection
shows that there is indeed a possibility of shallot imports to meet market demand. Imports
can be a threat to local shallot producers, this condition can occur if there is more supply of
shallots due to imports than market demand. If imports can be done in the right conditions,
for example, when supplies are limited, imports become a solution to keep prices from
soaring too much. The drastic decline in local shallot prices does not only occur when there is
a threat of imports, but during the harvest season if market demand is not able to give in
properly, prices will also decline.
Another problem that poses a threat to shallot farmers is the presence of pests and plant
diseases. Compared to pests and plant diseases, farmers in the Boyolali area are actually more
worried about the threat of fog. Fog itself is difficult to predict, fog can cause rot in plants, as
well as harvested bulbs. Therefore, farmers must always be vigilant in storing their harvested
bulbs, in a way that is still manual they cover the harvested shallot bulbs with plastic sheeting.
Onion Agribusiness
5.3
.1 Upstream Subsystem
Currently, there are no certified seed producers or providers in the Boyolali district.
Therefore, local farmers use seeds imported from the Batu-Malang area which is the area of
origin of the batu ijo variety of shallots. In addition to purchasing seeds, farmers usually also
utilize the bulbs from the first harvest to be cultivated again in the second planting. Storage is
done by hanging the bulbs in the caves, the quality of these seeds itself depends on the
previous harvest (Mahananto et al. 2023). The use of tubers as seeds if done repeatedly can
reduce the quality of the seeds themselves, due to the accumulation of tuber-borne pathogens
that can reduce productivity (Makhziah et al. 2019).
One of the seed innovations that has been found today is the botanical seed innovation
commonly referred to as True Seed of Shallot (TSS). According to Yufdy Mp and Harmanto
(2022), botanical seeds have several advantages, including healthier plants, high
multiplication ratio (1:200), and have a longer shelf life (>2 years). However, this innovation
is considered by farmers to be less suitable when applied in the Boyolali area, which is in the
form of highlands because the botanical seeds cannot grow optimally. The use of tubers is
also considered more profitable because the planting age until ready to harvest only requires
60-75 days while TSS seeds require up to 4 months to harvest. The main factors that
encourage farmers to use seeds include fast harvest age, suitability for land agroecosystem
conditions, product quality, easy product marketing (Theresia et al. 2016). According to
Waluyo N and Handayani T (2022), the obstacle faced in the application of TSS itself is that
there are still frequent failures in the seed preparation stage so that the percentage of seeds
that grow is low.
The shallot commodity is one of the nine commodities that receive subsidized fertilizer
quotas, which are currently limited to only two types of fertilizers, namely urea and NPK, this
is stipulated in MOA No. IX 10 Year 2022. In 2023, the supply of subsidized urea fertilizer is
25,000 tons, while NPK fertilizer is 16,500 tons. The distribution of subsidized fertilizers is
carried out under government supervision through distributors and Complete Fertilizer
Kiosks (KPL). In addition to the need for discipline in distribution, an issue that is still a
concern is the constraints of ownership of farmer cards, which until now 13,000 farmers do
not have.
Onion farming activities in Boyolali Regency currently still use technology that is
classified as simple or traditional. The equipment used by shallot farmers includes hoes used
for land formation in the early stages of planting. Farmers also use manual sprayers and
electric sprayers used for spraying grass growth inhibitors and pesticides. The irrigation
system also still uses a rainfed system due to the topographic conditions in the highlands.
According to Aldila et al. (2015) the level of application of technology, science, and the way
farmers think is influenced by the level of education.
Farmers are actually also willing to accept and implement training on the latest
innovations provided by the government, but sometimes the application is only done once by
the community. This condition is because in its implementation, the techniques applied are
not necessarily in accordance with the conditions of existing natural resources, so that if it is
deemed less profitable farmers will return to the old or traditional methods. Another obstacle
that is the reason for the non-continuation of the application of the latest innovations is
capital constraints, because at the beginning of the training the community was also given
capital assistance, but for further application the community may not have the capital to carry
it out independently. Efforts to increase production by using the latest good technology
require several supporting factors, including farmer characteristics, access to business capital,
and farm scale (Firmana et al. 2017).
5.3.2 Farming Subsystem
The stages of shallot cultivation in Boyolali consist of seed preparation, planting time,
land preparation, fertilization, maintenance, pest control, harvesting, post-harvesting, and
storage. The planting time of shallots in Boyolali currently still depends on the season, due to
its rain-fed irrigation system. The first planting is usually done around October, and the
second planting is done around March. After the first harvest, the harvested tubers can be
directly sold or used as seeds in the second cultivation. However, the bulbs in the second
harvest will be sold immediately because if used as seeds again it is feared that the results
will not be maximized. Onion cultivation activities in Boyolali are also still relatively simple,
for example in land preparation farmers still use equipment such as hoes. The use of
equipment that is still simple is due to the steep contours of the land given its location in the
highlands.
Onion farmers use tobacco as an intercrop in onion cultivation, considering that onion
commodities can only be planted in certain seasons. Tobacco and shallot planting cannot be
done simultaneously. This is because tobacco plants have a fairly long planting age and high
plant size. Plants with a high size cannot be planted together with plants that have a smaller
size such as shallots. This condition also makes shallots more profitable for farmers than
tobacco because when planting shallots farmers can still plant intercropping crops such as
carrots, cabbage, and broccoli.
Shallots also have a faster planting age and can be harvested after 60 days. In addition,
although the purchase price of tobacco seeds is much cheaper than shallots, the post-harvest
process requires more costs. Post-harvest treatment of tobacco consists of cutting and drying.
The process requires a relatively high cost, which can increase if there is no sun in the
farmer's area, so the farmer must look for drying services outside the area and must pay a
deposit fee every day. The same thing also happened in the Pamekasan area according to
agricultural extension workers, many farmers switched from tobacco crops due to the
uncertain price of tobacco, while the price of shallots is more stable and easier to market with
the existence of collectors (Ahsan et al. 2022).
5.3.3 Downstream Subsystem
Shallots are in high demand, so in the form of fresh products, shallots can be marketed
easily. In the Boyolali area itself, shallot buying and selling transactions are carried out in the
homes of farmers. Collecting traders from both the Boyolali area and outside Boyolali will
buy directly from farmers, making it easier for farmers to sell their crops. The existence of
collective traders also saves transportation costs for farmers because they do not need to go
far to market their agricultural products. Farmers also feel that with more collectors coming
to their area, prices will become more competitive. Collecting traders will later market
shallots to markets in Boyolali and outside Boyolali such as Solo. Collecting traders also
usually cooperate with home industries such as fried onion businesses. In their cooperation,
collector traders and business owners have agreed on the criteria for shallots that are
deposited in terms of type, size and color.
Fresh shallots when processed into processed products such as fried shallots will
increase the shelf life of the product up to 6 months. The activity of processing shallots into
fried shallots itself still uses relatively simple technology. Industry players generally use
several tools such as spinners to reduce water content before processing and reduce oil
content after the frying process. In the knitting process, business actors still use manual
knitting tools that require hand pushes, and electric knitting tools which are innovations from
the fried onion business owners themselves.
The fried shallot industry markets it to household consumers, food stalls, souvenir
centers, and fried shallot product collectors. On a large scale, the fried shallot industry can
cooperate with food product factories, but of course there are licensing requirements such as
P-IRT if they want to deposit their shallots. Product licensing such as P-IRT is currently an
obstacle faced by processing industry players, because there has been no socialization related
to special licensing of fried onion products. Fried shallot industry owners are also concerned
that if the price of shallots, which is the basic ingredient, rises, the selling price of the product
to the factory remains the same as the initial agreement. Fried shallot products are sold with
several grades, namely grade A (super) at Rp 90,000/kg, B (mixed) at Rp 85,000/kg, C
(depending on order) at Rp 70,000/kg.
5.3.4 Support Services Subsystem
The Boyolali government has collaborated with Bank Rakyat Indonesia (BRI) as the
banking institution that manages farmers' debit cards. The purpose of using farmer debit cards
is to ensure even distribution of subsidized fertilizer, monitoring, and of course making it
easier for farmers to obtain subsidized fertilizer during the planting season. T h e r e f o r e ,
the government expects farmers to join a registered farmer group, so that the assistance
provided can also be better channeled. Through farmer groups, farmers will be more
prosperous with the ease of obtaining subsidized fertilizers and other input assistance, and
can easily follow counseling related to shallot commodity cultivation. One farmer group called
Margomakmur in Wonodoyo Village has been established since 1996, with the aim of
moving forward together. Every month this farmer group gathers together at least once a
month. The farmer group is registered and has a membership structure, making it easier to
connect with BPP officers. Farmers who are members can get input assistance, training, and
can easily convey theconstraints t h e y face. Joining a farmer group has increased farmers'
knowledge, and farmers have been able to produce their own seeds. This shows that through
cooperation between the government through the BPP and farmers who are members of a
farmer group, can A certified seed business was established.
5.4 Environmental Analysis
Environmental analysis includes the internal and external environment, where the
internal environment includes the strengths and weaknesses that exist in a business area, and
comes from the business area itself. The internal environment analysis consists of several
aspects, namely production, human resources, marketing, finance, technology, and
institutions. The external environment includes opportunities and threats analyzed based on
political and legal, economic, social, technological, and environmental aspects. Based on the
analysis that has been carried out, several SWOT subfactors are listed in Table 7.
5.4.1 Power
1. Shallots are among the main vegetable horticultural commodities of Boyolali Regency.
Shallots are one of the main vegetable horticultural commodities in Boyolali Regency,
where other commodities are cabbage, chili, tomatoes, and carrots (Renstra 2016). According
to Susanti et al. (2018), shallots as a leading vegetable commodity have long been cultivated
by farmers intensively, and become a spice commodity that cannot be replaced with other
commodities. The production of shallots in Boyolali Regency alone reached 100,120 kw in
2020, which can be seen in Table 7. The amount of production makes Boyolali the fourth
center area with the highest shallot production in Central Java Province.
2. Onion harvest area increases every year
The harvest area of shallot commodities in Boyolali Regency increases every year, in
contrast to other shallot center areas in Central Java Province which fluctuate, this can be
seen in Table 1. The harvest area of shallots in 2020 reached 3,151 kw, this condition makes
shallots the horticultural commodity with the highest harvest area in Boyolali Regency.
3. Highland cultivation is suitable for batu ijo varieties with large and bright tuber yields
The highland cultivation land is suitable for the batu ijo variety which can be cultivated
in the topographic conditions of the land in the highlands with an altitude of 1000-1500
meters above sea level. The local variety is included in the 25 types of superior shallot
varieties inaugurated by the Minister of Agriculture. This variety has the advantage of a very
large bulb size of more than 20gram/bulb and bright color. The batu ijo variety also has low
bulb shrinkage compared to other local varieties, namely bauji and lancor biru (Prasetya and
Kusmanadhi 2019).
5.4.2 Weaknesses
1. There is no certified shallot seed producer in Boyolali There is no shallot seed producer in
Boyolali district.
The seed business requires high costs. Factors that can be an obstacle to seed production
other than capital include the need for large areas and warehouses, knowledge and skills of
human resources regarding seed production. Another constraint in the production of certified
seeds is that because seed production is carried out in the field, it will be difficult to meet
seed quality standards which require the intensity of major pest attacks to be only 0-0.5%.
Onion bulb seeds also have a short shelf life and large weight loss. Although there are now
seeds in the form of durable seeds, this method is difficult for farmers to implement (Theresia
et al. 2016).
2. Fluctuating productivity occurs
Based on BPS data from 2018 to 2020, Boyolali Regency experienced the highest
decline in productivity compared to the other five districts/cities in 2020, which decreased by
63% compared to its productivity in 2019. Although the harvest area increases every year, the
production fluctuates. This condition can occur due to the presence of pests and plant
diseases, uncertain climatic conditions, or even cultivation techniques that have not
implemented GAP. The implementation of shallot cultivation by farmers in Boyolali is not
fully in accordance with GAP guidelines, including the use of seed inputs farmers still use
uncertified seeds, and in handling pests farmers still use chemicals that can damage the
ecosystem in the long run. The contour of the land is an obstacle in the application of
irrigation technology The topographical condition of Kecamatan Cepogo, which is an area
with Most shallot production in Boyolali Regency is in the form of undulating hills with
slopes varying between 0-70%. This condition is an obstacle in the application of irrigation
technology so that shallot cultivation still depends on certain seasons considering that the
land is rainfed.
5.4.3 Opportunities
1. The existence of APBN-TP and APBD budgets for shallot area development
The Boyolali District Government provides assistance sourced from APBN-TP and
APBD funds for the development of shallot commodities. The budget can be used to realize
shallot commodity development programs in each agribusiness subsystem. One of the
existing assistance is the provision of agricultural equipment in the form of cultivator tools to
shallot farmers in Jerukan Village. The provision of agricultural machinery assistance
(Alsintan) itself has been determined by the Directorate General of Agricultural Infrastructure
and Facilities through the Decree of the Director General of Agricultural Infrastructure and
Facilities Number 45.2 / KPTS / SR. 430 / B / 11 / 2022 concerning technical guidelines for
the provision and distribution of agricultural equipment and machinery assistance for fiscal
year 2023. Based on this decision, the horticultural commodity center area is one of the
prioritized locations for aid procurement. Alsintan that will be provided as assistance includes
2-wheeled tractors, 4-wheeled tractors, water pumps, cultivators, and hand sprayers
(Kementan 2022).
2. The existence of processing technology guidance from the Directorate of Processing and
Marketing of Horticultural Products
The government also pays attention to the development of processed onion products by
providing guidance on processing technology organized by the Directorate of Processing and
Marketing of Horticultural Products. Farmers in Boyolali Regency tend to sell shallots in
fresh form, so the guidance on processing and marketing technology can encourage farmers to
develop shallot product processing activities.
3. High demand for shallots
Shallots are a horticultural commodity with high demand due to the utilization of
shallots for households and industries. Household consumption in Indonesia of shallots has
increased in 2021, reaching 790,630 tons/year as shown in Figure 1. The high demand is an
opportunity for farmers to be able to cultivate the commodity. Horticultural products are
commodities that are strongly influenced by demand. If the level of demand is guaranteed or
stable, it will support an increase in production (Director General of Horticulture 2021).
4. Onion processing technology (vegetable washer, dewater machine, onion machine)
In order to increase the added value of shallot commodities, it is necessary to process
fresh products into processed products such as fried shallots. The rapid development of
technology is an opportunity in various fields, including processing. Currently, there are
processing technologies such as vegetable washer, dewater machine, onion machine that can
simplify and shorten the product processing process.
5.4.4 Threat
1. Onion imports
The inability to fulfill the demand for shallot supply through domestic production
makes imports a solution that can be taken. The relationship between domestic shallot
production and shallot import demand is negative so that to reduce shallot import demand it
is necessary to increase domestic shallot production (Pasaribu and Daulay 2013).
2. Pyropora/shoot death pest attack.
Plant disrupting organisms (pest) attack, namely pyropora/shoot death, is a threat to
shallot plants. Shoot death disease, which damages the tip of the plant, is caused by the
fungus Phytophthora porri (Faister). Based on data from the Department of Agriculture,
Plantation and Forestry of Boyolali Regency in 2015, the total area of pest attacks on shallot
fields reached 41 ha, which amounted to 2.47% of the total planted area of 1,655 ha.
3. Erratic climate and weather conditions (prolonged dry season, fog)
Boyolali Regency is at an altitude between 75 - 1500 meters above sea level,
topographically in the form of lowlands accompanied by hills and mountains. The largest
shallot producing area in Boyolali itself is in Cepogo Sub-district which has topographic
conditions in the form of hills. Topographic conditions in the highlands cause fog. Fog is
water vapor or clouds near the condensed ground surface. Fog is a threat to both shallot
plants and harvested shallot bulbs, because fog can cause rotting. The prolonged dry season is
also a threat considering that shallot fields are rainfed. Such erratic climate change can affect
the planting schedule.
5.5 Strategy Formulation
5.5.1 S-O Strategy (Strengths-Opportunities)
1. Increased production by optimizing resource utilization (S1, S2, S3, O1, O3)
The shallot commodity is the main vegetable horticultural commodity in Boyolali
Regency and is supported by several natural resource advantages in the form of suitable
cultivation land for the batu ijo variety of shallots and an increasing harvest area. These
advantages need to be optimized so that production can be increased to meet the high
demand. In optimizing the use of these natural resources, the role of farmers as human
resources is needed, and the government in empowering farmers. The Directorate General of
Horticulture has compiled steps that can be taken in increasing the supply of horticultural
commodities, such as the stability of production inputs, scheduled agribusiness assistance,
comprehensive agribusiness management, and the use of modern and environmentally
friendly technology.
(Director General of Horticulture 2021). Cooperation between the government and farmers
can be done more easily if farmers are willing to join a farmer group.
2. Development of processed shallot products (S1, O1, O2, O4)
Through the APBN-TP and APBD budgets and the processing guidance provided, it is
hoped that shallots, which are the main vegetable horticultural commodities, can be processed
to have added selling value, one of the processed products such as fried shallots. Processing
fresh shallots into processed products such as fried shallots will also increase the shelf life of
the product. Fried shallots are a product that can be stored for approximately 6 months.
Technological developments will also help shallot processing activities to be more efficient.
5.5.2 W-O Strategy (Weaknesses-Opportunities)
1. Development of certified shallot seed business (W1, W2, O1)
The absence of a certified shallot seed business is an obstacle in the implementation of
cultivation, this condition is due to the procurement of seed business which requires
considerable capital. According to Aziz et al. (2013), seeds contribute to the success of crop
production, seed input also cannot be replaced by other inputs. Quality seeds can support
increased production in a sustainable direction to maintain supply stability (Director General
of Horticulture 2021). Onion farmer groups themselves have been able to produce seeds
independently, but to meet the criteria of certified seeds, training and supervision from the
government through agricultural extension officers are needed. The ability and openness of
farmers to accept the cultivation technology provided by the government shows the
opportunity for seed business development which certainly requires support from the
government. Through the APBN-TP and APBD budgets for the development of shallot areas,
it is hoped that it can become capital in the implementation of the development of certified
shallot seed business.
5.5.3 S-T Strategy (Strengths-Threats)
1. Improve monitoring of supplies (S1, T1)
The strategy of increasing supervision of supply supplies needs to be carried out in
order to fulfill domestic demand. This strategy will also affect the stability of national prices,
if the supply of shallots has been able to meet domestic demand, the selling price of shallots
will not jump too high. The government also does not need to import shallots that can disturb
local farmers. The existence of shallot area development activities based on GAP (Good
Agricultural Practices) aims to increase production as well as supply of shallot commodities
(Director General of Horticulture 2016). In maintaining the availability of shallot storage
supplies, a warehouse with a CAS (Control Atmosphere Storage) system can be applied, so
that shallot supplies can be stored for up to 3-6 months and keep the shallots in good
condition. The quality remains fresh, not wrinkled, protected from insects and spoilage. The
application of GAP will support the achievement of production targets, then monitoring the
storage of shallot supplies in accordance with GAP and using CAS (Control Atmosphere
Storage) technology will maintain availability throughout the year. The availability of
shallots that are guaranteed and able to meet domestic demand will reduce import levels.
5.5.4 W-T Strategy (Weaknesses-Threats)
1. Strengthen GAP implementation (W1, W2, W3, T2, T3)
The application of GAP (Good Agricultural Practices) is very important in agriculture,
where GAP itself requires producers to produce products that are safe for consumption,
sustainability, labor safety, and of course produce quality products. There are still shallot
farmers in Boyolali who have not implemented GAP in their agricultural activities, one of
which is that farmers still use chemicals that are not recommended in exterminating pests.
Based on MOA No. 48 of 2009 concerning Good Agriculture Practices for Fruit and
Vegetables, the reason for the issuance of GAP is as a reference in good plant cultivation
activities. The objectives of GAP include increasing crop production and productivity,
increasing production efficiency, improving the efficiency of natural resource use, and
several other objectives. According to Situmorang (2022), in shallot cultivation itself, GAP
(Good Agricultural Practices) has been established which consists of several stages,
including:
a. Site selection
The purpose of site selection is to prevent failure of the production process and be able
to achieve the specified production target. Site selection requirements include having a pH of
5.6-6.5, an altitude of 0-400 meters above sea level, a temperature of 25-320 C, soil in the
form of rice fields or moorland with a medium to fine texture, and contains a lot of organic
matter. Certain varieties can also have different location criteria, for example the batu ijo
variety which can be planted at an altitude of 1000-1500 meters above sea level.
b. Seed preparation
Prepare a sufficient amount of quality seeds of superior varieties, ready for planting
after being stored for 3-4 months. The seeds used should be quality seeds of superior varieties
that have seed labels authorized by BPSB (Seed Supervision and Certification Agency).
c. Determination of planting time
The planting time of shallot commodities currently still depends on a certain season, the
determination is based on the forecast of the arrival of the rainy season or the availability of
irrigation water, and the agreement of the group planting pattern. Onion farmers in Boyolali
Regency generally plant around October and March. This condition is due to the fact that the
farmland is located in the highlands and the irrigation uses a rainfed system.
d. Land preparation
In starting the activity 10-15 days before planting perul, the initial steps consist of
clearing the land of rocks, weeds, and other plant debris. The aim is to improve soil air and
aeration conditions, remove toxic gases, and heat from the decomposition of previous crop
residues. Next is tillage by turning the soil to dry and applying 5-10 tons/ha of manure, after
which the land is left for 1 week. The next stage is the making of beds, with a width of 80-
100 cm, a height of 30-60 cm in the rainy season and 10-20 cm in the dry season, a distance
of 40-50 cm between beds, and the size of the perimeter manhole 60 cm wide and 50 cm
deep. The size will actually still adjust to the conditions of each land depending on the
availability of water.
e. Fertilization
Fertilization activities must be in accordance with the 4 right, including the right dose,
the right method, the right time, and the right type.
1. In the dry season, manure is applied during tillage.
2. Basic fertilization is done 1 day before planting in the dry season using NPK fertilizer
(15:15:15) 125 kg/ha. While in the rainy season using urea fertilizer as much as 50 kg/ha, ZA
as much as 100 kg/ha, SP-36 as much as 100 kg/ha, and KCL as much as 100 kg/ha.
3. Supplementary fertilization 1 was done 15-20 days after planting, consisting of 125 kg/ha of
urea, 50 kg/ha of ZA, and 100 kg/ha of KCL.
4. Follow-up fertilization 2 in the dry season is carried out on days 28-35 after planting, using
ZA fertilizer as much as 50 kg/ha, and KCL as much as 50 kg/ha. If the plants look fertile this
second supplementary fertilization is not necessary.
f. Irrigation
Watering is an important part of shallot cultivation, its availability must be ensured
from planting to harvest. In the early growth period, after the buds grow evenly until the
plants are 30 days old, watering is done every day. Further watering until 5 days before
harvest is done every 2 days.
g. Maintenance
Onion plant maintenance is carried out by cleaning the planting area and weeds that
grow.
h. OPT (Plant Disturbing Organism) Control
In controlling pests (Plant Disturbing Organisms), of course, at the initial stage it is
necessary to routinely observe and identify the land. Several activities are carried out in
controlling pests, including:
1. Technical cultivation which consists of determining planting time, planting patterns,
simultaneous planting and improving cultivation methods.
2. Physical/mechanical/trap control.
3. Biological control.
4. Chemical control using pesticides, if the attack has reached the control threshold.
i. Harvest
Harvesting is done by identifying the physical development of the plant, especially the
leaves. Harvesting is done after the plants are 60-72 days old with the physical characteristics
of 80% of the leaves fallen, yellow and empty stem neck, and tubers appear to the surface of
the horn with a red color. Harvesting is done in sunny weather and not during the rain, by
pulling it out by hand or tools with care.
j. Postharvest
1. Withering is done in sunny weather for 2-3 days or in the wind for 2-4 weeks until the leaves
become dry. Next, drying is carried out for 7-10 days or can also be done by hanging on para-
para by turning it every 2 days.
2. Sorting is a cleaning that is done to separate the shallot bulbs from the dirt attached to the
bulbs.
3. Grading aims to determine the grade of shallot bulbs. The grading standard itself is based on
the following characteristics, varietal similarity, aging, hardness, diameter, damage, rot, and
dirt.
k. Storage
In general, farmers do traditional storage by hanging shallots using para-para above the
fireplace. Storage using a warehouse must pay attention to cleanliness and have adequate
ventilation with humidity around 65-70%, as well as sufficient sunlight.
l. Packaging and distribution
In the packaging process, the number of shallot bulbs must be in accordance with the
order requirements. Packaging for short-distance shipments can use mesh/knit sacks (koli)
weighing 90-100 kg/koli. Long-distance or inter-island shipments use mesh/knit sacks (koli)
weighing 20-25 kg/koli. Distribution must pay attention to the date, location, and quantity to
be sent, and the transportation equipment is suitable for use according to the carrying
capacity.
5.6 Pairwise Comparison
This research on development strategies uses the A'WOT method in formulating the
priorities of strategies that must be carried out. Based on this method, an AHP hierarchical
structure that includes SWOT components can be seen in Figure 8. The AHP hierarchy is
useful as a basis for respondents in weighting to make it simpler (Rainy et al. 2019). The
hierarchical structure will consist of goals, where in this study the goal is to obtain a strategy
for developing shallot agribusiness in Boyolali Regency. At the second level there are criteria
that include strengths, weaknesses, opportunities, and threats. The third level contains sub-
criteria which include subfactors of each SWOT component. The fourth level is an alternative
strategy that has been formulated through the SWOT matrix in Figure 7.
5.6.1 Pairwise Comparison of Factors
In accordance with the method applied, namely A'WOT, pairwise comparisons are
made at each level or level. The first pairwise comparison compares SWOT factors, namely
strengths, weaknesses, opportunities, and threats, which can be seen in Table 8. Based on the
comparisons that have been made, it is found that the most important factor is the strength
factor (0.417), followed by the weakness factor (0.291), the opportunity factor (0.224), and
the threat factor (0.068). The requirement for pairwise comparison of the AHP method itself
is that the inconsistency ratio value does not exceed 10% (0.1) so that the pairwise
comparison at this level meets the requirements, which is worth 0.048.
5.6.2 Pairwise Comparison of Subfactors
Pairwise comparisons at the next level compare between subfactors in each SWOT
factor, where the results can be seen in Table 9. Based on the comparisons that have been
made, it can be seen that the most important subfactor in the strength factor is cultivation land
in the highlands suitable for the batu ijo variety with large and bright bulb yields (0.413) with
an inconsistency ratio value that has met the requirements, namely 0.052. Cultivation land is
an important factor in agricultural activities including shallot commodities. Land selection is
also the initial stage of shallot cultivation based on GAP (Good Agricultural Practices), with
the aim of preventing production process failures and being able to achieve production
according to predetermined targets. The selected cultivation land must meet the requirements
of shallot growth, where Boyolali itself has a plateau that is suitable for the cultivation of the
batu ijo variety of shallot. The batu ijo variety, which has brightly colored and large-sized
bulbs, is a special attraction, especially for the fried shallot processing industry.
The second priority subfactor of strength is that the shallot harvest area increases every
year. The last strength subfactor is shallots including the main vegetable horticultural
commodity of Boyolali Regency. The three strengths are actually equally important and
support the successful development of s h a l l o t agribusiness, but the prioritization of
these strength subfactors will determine the priority of alternative strategies obtained from the
overall hierarchical structure. In pairwise comparisons of weakness factors, the most
important subfactor is fluctuating productivity (0.413) with an inconsistency ratio value of
0.052 so that it q u a l i f i e s . The occurrence of fluctuating productivity is certainly a
problem that must be addressed immediately, given the high demand for shallots. The
problem of fluctuating productivity indicates the existence of linkages between agribusiness
subsystems. One of the weakness factors that cause it is the weakness of the input subsystem,
namely the absence of certified shallot seed producers in t h e area. The weakness subfactor
becomes the second subfactor in the pairwise comparison of weakness factors (0.327). The
absence of certified seed producers is one of the causes of farmers in carrying out cultivation
activities not using certified seeds, so that production is also less than optimal. According to
Azmi et al. (2011), to achieve maximum shallot productivity, high quality seeds are needed
and the fulfillment of the requirements for the provision of quality seeds (suitability of
varieties, quantity, quality, time, location), and price). The third weakness subfactor is that the
contour of the land is an obstacle in the application of irrigation technology (0.260),
Pairwise comparison of opportunity factors shows that the opportunity with the highest
weight is high shallot demand (0.397) with an inconsistency ratio value of (0.069) so that it
qualifies. High shallot demand is an opportunity that must be utilized and cultivated so that to
meet domestic demand the government does not need to import shallots. According to
Prasekti and Krisanti (2018), domestic market potential and export opportunities are
prospects for the development of shallot agribusiness in Indonesia, but until now the export
volume is still limited given the high domestic demand.
The second opportunity subfactor based on pairwise comparisons is the technological
and processing guidance from the Directorate of Processing and Marketing of Horticultural
Products (0.278). Farmers and farmer groups in Boyolali currently sell more of their crops in
the form of fresh products, because in the form of fresh products alone the crops can be easily
sold through collectors who come directly to them. However, this does not guarantee that
farmers always get a favorable price for them, given the fluctuating price of shallots.
According to Hariyani (2018), to reduce losses due to falling prices during the harvest due to
oversupply and to increase the selling value of shallots, processing activities are needed.
Through technological and processing guidance provided by the government, it is hoped that
farmers through farmer groups will be able to process shallots into products that have added
value. Processed shallot products that can be developed include fried shallots, shallot paste,
and shallot oil. The next opportunity subfactor is the existence of the APBN-TP and APBD
budgets for shallot area development (0.168), and finally the existence of shallot processing
technology such as vegetable washer, dewater machine, and onion machine (0.158).
The next pairwise comparison is on the threat factor, where the most important
subfactor is uncertain climate and weather conditions (0.474) with an inconsistency ratio
value of 0.052. Weather is still a difficult condition to predict, one of which is the fog event.
Climate change has a direct influence on the level of food crop production, and an indirect
influence by increasing pests and diseases that attack plants, thus affecting productivity
(Santoso 2016). Boyolali Regency's cultivated land in the highlands makes fog one of the
threats faced by shallot farmers.
The second threat subfactor based on pairwise comparison is shallot imports (0.376).
The majority of imported shallots entering Indonesia come from Thailand, Vietnam, the
Philippines, and China. According to Fitriana et al. (2019), if the implementation of shallot
imports is not in the right amount and time, it can result in an increase in domestic supply and
the price of local shallots decreases. This condition can cause farmers' income to decline even
when farm production costs have not decreased. The lower the income of farmers are also
unable to increase their production, so that domestic shallot production also does not increase
(Fitriana et al. 2019). The last threat subfactor is the presence of pest attacks (OPT) and plant
diseases/shoot death (0.149).
5.6.3 Pairwise Comparison of Strategy Alternatives
Pairwise comparison of alternative strategies is carried out based on each SWOT
subfactor to determine the priority of strategies taken when adjusting the importance of each
subfactor. On the strength factor, the three subfactors show that the main priority strategy that
can be taken is to strengthen the application of GAP (Good Agricultural Practices) can be
seen in Table 10. The subfactor of shallots including the main vegetable horticultural
commodities of Boyolali Regency shows that strengthening the application of GAP is the
main priority (0.369). The subfactor of shallot harvest area increasing every year also requires
a strategy of strengthening GAP implementation as a top priority (0.397). The strategy of
strengthening GAP implementation is also a top priority based on the subfactor of the
strength of cultivation land in the highlands suitable for the batu ijo variety with large and
bright bulb yields (0.368). The strategy is able to guide the activities of the shallot
agribusiness, which is the main horticultural commodity, in order to be able to increase the
yield of shallots achieve production targets by utilizing the harvest area that increases every
year, and land conditions that are suitable for the development of batu ijo shallot varieties.
Pairwise comparison of alternative strategies on the weakness subfactor can be seen in
Table 11. The weakness subfactor has no certified shallot seed producer in Boyolali has the
main strategic priority of developing a certified seed business (0.541). Of course, problems
related to seeds require a solution, namely the development of the certified seed business
itself. Seeds themselves as agricultural inputs play an important role in the success of
productivity, so in the comparison of pairs of alternative strategies, the seed business will be
prioritized. Furthermore, in the weakness subfactor of fluctuating productivity, the main
priority of the strategy is to strengthen the application of GAP (0.313). GAP (Good
Agricultural Practices) provides guidance from land selection to distribution, currently
farmers still do not apply GAP principles, for example in the use of seeds and pest control, so
it is hoped that with the application of GAP, the implementation of GAP will be prioritized
productivity can increase. The strategy of strengthening the application of GAP is also a top
priority in the subfactor of soil contour weaknesses being an obstacle in the application of
irrigation technology (0.419). Irrigation technology is an important factor in shallot farming
activities, although currently the application of irrigation technology is still difficult to apply
to land contours in the form of slopes through GAP which provides guidance related to land
preparation and planting time is expected to minimize the constraints of the irrigation system.
6.1 Conclusion
Based on the research that has been conducted on the development strategy of shallot
agribusiness in Boyolali Regency, the following conclusions can be drawn:
1. Internal influencing factors are divided into strengths and weaknesses. Strengths include: (1)
shallots are among the main vegetable horticultural commodities in Boyolali Regency, (2) the
harvest area of shallots increases every year, and (3) cultivation land in the highlands is
suitable for the batu ijo variety. Weakness factors include: (1) the absence of certified shallot
seed producers, (2) fluctuating productivity, and (3) soil contours that are an obstacle in the
application of irrigation technology.
2. External factors that become opportunities include: (1) the existence of the APBN-TP and
APBD budgets for the development of shallot areas, (2) the existence of processing
technology guidance from the Directorate of Processing and Marketing of Horticultural
Products, (3) the high demand for shallots, and (4) the availability of shallot processing
technology.
(4) shallot processing technology already exists. The threat factors include (1) shallot
imports, (2) pest attacks (OPT) and pyropora/shoot death plant diseases, and (3) uncertain
climate and weather conditions.
3. The priority strategy for developing shallot agribusiness in Boyolali is to strengthen the
application of GAP, followed by increasing production by optimizing resource utilization,
developing certified seed businesses, increasing supervision of supply supplies, and finally
developing shallot processed products.
