KINERJA AGRIBISNIS SAPI POTONG RAKYAT DI PROVINSI JAWA TIMUR: DAMPAK KRISIS MONETER DAN IMPLEMENTASI KEBIJAKAN OTONOMI DAERAH

Abstract

In the period of 1995 - 2002, domestic cattle agribusiness in East Java has indicated an
unpleasant condition, the growth of production, consumption and trade tend to decrease
around 1.5 - 4.7 percent a year. Meanwhile, nominal price of feed and livestock products
have increased more than 8 percent. Although, the real prices were increasing only around
0.5 - 1.4 percent a year. Economic crisis affect significantly the decreasing of the
household income, it has an impact in reducing of the volume of East Java cattle
distribution to outer region. This condition become worse by reduction of cattle population
growth and competition with live cattle import and their products. In 1995-2002 and during
the regional autonomy policy implementation process, cattle population growth has
decreased - 1.71 and - 24.85 percent a year respectively. Generally, decreasing of cattle
population growth has related to reduction of cattle herd that no longer used in
intensification of paddy field. Decreasing of cattle population growth during the regional
autonomy policy implementation process were caused by three reasons, such as: (1) Lack
of local government ability to increase the development of breeding and fattening business
that related to the budget and government management problems; (2) Market demand of
cattle from outer region was decreasing; and (3) The real price of breed and fattening cattle
was not attractive for farmers to carry on in their business. Based on those problems
above, in order to develop domestic cattle agribusiness, it is necessary to develop: (1) The
policy which able to consolidate the central, province, and district government in
implementing integration programs; (2) Reducing market distortion policies; (3) Provide
protection and special treatment for small scale farmers to face global trade liberalization;
and (4) Institutional reform of domestic cattle agribusiness.