Chili is one of vegetable commodities that have high economic value, because of its role to meet domestic needs, as an export commodity and food industries. This study begins with the identification of the basic model of supply chain and the problem in the chilli industry. Furthermore, the model is analyzed with system dynamics approach and simulation was done to know the behavior of the system in chili industry. The behavior of chili supply chain system will be increased until year 2025, but margin of the price will be increased too. Therefore, improvement scenarios are to decrease a margin value of the price along the chili supply chain. The government must determine the profit value for the chili supply chain. Also, the government must give an intervention for the price standard of marketing along chili supply chain so the price margin between farmer and the end customer will be decreased. Keywords: chili, the price margin, system dynamics, supply chain, simulation
Chili (Capsicum annuum L) is one of vegetable commodity which has high economic value because its role is big enough to fulfill domestic requirement as export commodity and food industry. Chili is a strategic horticultural commodity, both red chilli and cayenne pepper. Indonesian society is one of the biggest chili enthusiasts in the world. Therefore, chili becomes one of the important products of Indonesian food, even it can affect the rate of inflation.Chili needs for large cities with a population of one million or more about 800,000 tons / year or 66,000 tons / month. In “hajatan” or religious festivals, chili needs usually increase in 10-20% of normal requirement. Chili productivity rate nationally during thelast 5 years about 6 tons / ha. The urban community to meet the monthly needs is required chilli harvested area of about 11,000 ha/month, while in the celebration season of harvested area of chili that is available ranges of 12.100-13.3 ha / month. Also, the needs of chili for rural communities or small towns as well as for processed raw materials (Suwandi, et al.,2016). To meet all the needs of chili is needed supply of chili sufficient. If the supply of chili is less or lower than the demand so the price will increase. Conversely, if the supply of chilli exceeds the need, the price will decrease.In terms of price, chilli has a characteristic often occur very high price fluctuations. For example, a surge in prices above 100% is very common. Even in January 1996 the price of chilli jumped about 327% compared to the previous month’s price. Chili price increases to recur within 2-3 months and then thereafter decrease to 2-3 months. By using the Coefficient of Diversity (KK) as an indicator of stability, the price of chili in 2010 reached 57% and the price of red chili pepper in 2010 reached 35%, much higher than the price of rice and sugar in the region, at 6.6% and 3,7% (Farid and Subekti. 2012).Toward the end of the year until the beginning of the year, the price of chilli spikes high enough to reach more than Rp 100.000 / kg, while at a certain price can fall belowRp 10.000 / kg.These seasonal price fluctuations occur almost every year. The spike in the price of chili is due to reduced supply, while constant and continuous demand every day, even increasing in certain seasons. Fluctuations in the price of chilli occur due to seasonal production of chili, rain factor, production cost and length of distribution channel (Farid and Subekti 2012). Meanwhile, the price
Growing Chillies (Capsicum Annuum, Capsicum Var.)
How To Grow Chili Peppers
Are you growing chillies or chilis? Nevermind the different spellings, there are even more shapes, sizes and colours!
At one stage growing chillis was a special passion of mine. Do you know how many different varieties there are? And how ornamental they are?
or a while I had about 25 different chilli varieties growing…
But let’s forget about me. Everybody needs to grow chillis for cooking. Even if you don’t like hot food, just a little hint of chilli to warm it up stimulates the taste buds and everything else tastes just so much better. True.
And chillies will brighten up your garden!
But before we get to the instructions for growing chillis, lets sort out the spelling, lest you think I don’t know any better…
How Hot Will Your Chillies Be?
The heat of chillies is caused by naturally occurring ingredients called capsaicins and is measured on the Scoville scale. The scale ranges from zero (capsicums/bell peppers) to 16,000,000 (pure capsaicin).
It’s not possible to assign an accurate Scoville unit amount to a plant because the heat of the fruit will vary with the weather, the age of the plant, the soil and however the plant feels on any given day.
Still, some varieties are hotter than others, so here is a list of well known varieties, in ascending order on the Scoville scale, from zero to around 500,000:
Where Can You Grow Chillis?
Chilli plants love heat. They are closely related to capsicums/bell peppers and also related to tomatoes (they are in the same family, the solanaceae), but chillies prefer their growing conditions a lot hotter.
Chilli seeds need 20°C/68°F to germinate, and it should be 30°C/86°F or more for the fruit to ripen. Night temperatures should not drop below 15°C/60°F, at least not on a regular basis. The odd cool spell is ok.
Chillies also don’t mind humidity as much as sweet peppers or tomatoes do.
Most people will need to grow chillis in full sun. In the hottest, sunniest regions chillies still grow well with a bit of shade. Especially afternoon shade can even be beneficial. It will prevent the fruit from getting sunburned.
If you live in the tropics or subtropics, great. Your chillies should thrive. Even the “annual” varieties should live for two to three years and produce fruit for you all year round.
If your climate is not tropical, don’t despair. You can still grow chillies if you get decent summers. And you can extend the growing season by growing chilis indoors, just like you do with tomatoes.
Chillis are related to tomatoes, so the growing methods and requirements are similar. Except that chillies need more heat.
People with small gardens or balconies will be pleased to hear that you can grow chillis in pots.
How To Grow Chillies From Seed
You can buy chilli plants in a nursery or you can grow chillis from seed. Remember that the seed needs at least 20°C/68°F to germinate.
Start them in early spring in cooler climates or any time during the dry season in the tropics. You could start them all year round in the tropics but it’s a good idea to let the plants grow strong before the wet season hits them.
Chilli plants are usually started in seedling trays or small pots. They are very vulnerable when small and they don’t grow all that fastStill, I prefer to start mine directly in the ground because like capsicums, chillis don’t like being transplanted.
Actually, I only start them in the ground when I have enough seed to allow for a high percentage of fatalities. (I am the laziest gardener I know, so I don’t look after my seedlings much.) I usually have enough because I save my own seed.
If I buy seed of a new chilli variety and I get one of those tiny packets with barely a dozen seeds in them, then I start them in pots.
You can plant several chilli seeds per pot. Once your seedlings have a few leaves, snip off the weaker ones and only keep the strongest plants.
You only want one chilli plant per pot when you plant them out.
Otherwise you will disturb their roots too much and they HATE having their roots disturbed.
If you grow chillies in seedling trays or little punnets, plant them out once they have four to six true leaves (are about 5 cm/2 inches tall). If you don’t, their roots will start feeling restricted and it will set them back.
Chillies don’t mind growing in bigger pots, so the timing for planting them out is not critical if you use pots. If you live in a cooler climate, use pots. Let them to grow to 10 to 15 cm/4-6 inches. Make sure it’s warm enough before you put them outside!
Water the chillies before transplanting, so the soil doesn’t fall apart when you remove them from the pot. Be VERY careful when removing the seedlings from their pots.
Drop them in a hole in the garden, fill it back in, firm down the soil, water. Done.
Growing Chilli Plants
Chillies grow in a variety of soils. Like most plants they grow better in rich soils and produce more fruit, but they will grow in any reasonably fertile soil and don’t need any special treatment. If you use plenty of mulch and compost in your garden the chillies will grow just fine.
If your soil is poor, you’ll have to fertilize your chillies. (And start using more mulch and compost.)
When fertilizing chillies keep in mind that, like their relatives and indeed most fruiting plants, chillies like potassium. Too much nitrogen will make them grow lots of soft leaves and no fruit.
It is important to keep your chilli plants well watered and mulched. Mulch not only improves soil over time, it also protects it from drying out.
Chillies have such a tough and hardy image, people often don’t realize how sensitive they are when it comes to lack of water. Make sure your chillies have plenty and never dry out.
At the same time, don’t overwater. The soil should be free draining. Chillies don’t grow in swamps.
Problems When Growing Chillies
Chillies have weak branches. If they are loaded with fruit they can snap off. The whole plants are prone to branches drooping on the ground and breaking off, so you may want to give them some support.
(I don’t. I just cut off the broken branches and the bush grows new ones. Chillies don’t mind if you prune them.)
A stake will also prevent the whole plant from toppling over, which also happens because their roots are only shallow and not very strong.
Root knot nematodes can cause the plant to wilt and die for no obvious reason. However, root knot nematodes are a sign of very poor soils. If you add lots of compost and mulch to your garden you shouldn’t have any trouble.
Other than that chillies grow happily and aren’t bothered much by any pests or diseases. If they struggle it’s usually a sign that the soil is not as good as you thought.
Did I mention that compost and mulch is great stuff?
Harvesting Chilli Peppers
Chillies are quick to fruit and flower. How quick depends on the variety and on the temperature.
You can harvest the first chillis green once they reach full size. Or you wait until they turn red, or whatever colour they are supposed to turn.
If you plan to dry them for chili powder or flakes, you can even leave them on the bush until they shrivel up and dry.
To harvest fresh chillies cut or pull off the mature fruit while it’s still shiny and plump.
If you pull it off, pull it upwards, exactly opposite to the direction in which it bends down. Then it should snap off at the joint, without breaking off the whole branch. Otherwise just snip them off.
The fruit will last in a sealed bag in the fridge for up to a week.
You can dry it in the dryer or sun dry it, you could also just string it up and hang it up to dry in an airy spot.
Pound it to flakes or put it in the blender to make cayenne pepper and chili powder.
A Word Of Warning
You don’t need to eat chillies for them to burn you!
Just wait till you get Habanero chilli juice under your fingernails for the first time…
When cutting fresh chillies, make sure to scrub your hands well after. Don’t touch your skin and especially don’t touch your eyes! The hottest chillies can make you go blind. I am not kidding.
When working with dry chilli be VERY careful not to breathe in any powder. Also don’t get it in your eyes.
Proceeding the 1stInternational Conference on Food Security Innovation 2017 ; 142 –160 p143Ridwan et al.disparity between chilli regions occurred because the center of pepper production is concentrated on Java and the quality of road infrastructure is inadequate (Irawan 2007). The problem of national chili supplies availability is very important to be studied because it concerns national food security.Food security is one of the decisive factors in the national stability of a country, both in economic, security, politics and social. Food security is a major program in agricultural development at present and in the future. Food security is the condition of the fulfillment of household food which is reflected from the availability of adequate food, both quantity and quality, safe, equitable, and affordable. Measures of food security in terms of self-sufficiency (independence) can be seen from the dependence of national food availability on food production in the country. The concept of self-sufficiency (independence) is scenario as a condition where national food requirement is at least 90% fulfilledfrom domestic production (Suryana, 2004).Although food availability is sufficient at the national and regional levels, but if individual access to meet food needs is uneven so food security is still fragile. The aspect of the distribution of foodstuff torural households that includes the function of place, space and time is also an effort to strengthen food security strategies so it is important to assess supply availability in chili pepper supply chain in the framework of national food security.Severalscientific studies related to this research have been conducted by several researchers. Sahara et al. (2011) examines the effect of quality farmer-chili merchant relationships of Indonesia on supply chains in modern and traditional markets. Hadi and Susetyo (2011) studied the marketing margin of red chili in Jember district. Prabhavathi et al. (2013) examines the supply chain analysis of red peppers in India comparing two types of supply chains. Kurniawan et al. (2014) examines the analysis and measurementof supply chain efficiency of large red chili commodities in Jember District. Ongirwalu et al. (2015) examines the downstream evaluation of the supply chain in the chili commodity logistics system in the traditional market of Pinasungkulan Manado. Tuti,K. etal.(2015)examines the design of a red chili commodity supply chain modeling model in West Java with a structured market orientation using case study method with qualitative modeling approach through identification of value stream mapping. Buntuan (2010) conducted a study on early simulation for food crisis management by using dynamic simulation method to see the parameters affecting food crisis then simulated with dynamic model. Akhmad (2013) conducted a study on food security with data analysis using a dynamic model on rice supply chain.Supply chain is composed by a number of interacting entities through a distinct interaction pattern according to the structure formed. The more number of entities involved in the supply chain will affect the structure and determine the complexity of a supply chain. These entities interact to achieve a common goal, namely the final consumer. According to Zhou and Benton (2007), a supply chain is an integrated system. As a system, the point of view of the analysis of the supply chain must be comprehensive. The entire system components must be viewed as an integral whole. Inequality in one component will disrupt the system as a whole. Therefore, the purpose of a study or analysis of a supply chain is a proportionate increase overall across entities from upstream to downstream.This research was conducted to identify the basic system of chili pepper supply chain in achieving national food security, to formulate conceptual system and formulation of chili supply chain model to achieve national food security, and to know the behavior of chili supply chain system for the next 10 year
The design of dynamic system of chili supply chain starts from the analysis of the situation and condition of chili industry in Indonesia, then identifies the basic system of chili supply chain by looking at upstream and downstream sub-system diagrams and causal loop diagram of chili supply chain. Flow diagrams with mathematical equations, simulations and validation tests into supply chain models with economic and social aspects as policy analysis or decision. This research is a combination of
Proceeding the 1stInternational Conference on Food Security Innovation 2017 ; 142 –160pSupply chain design of chili commodity…..144explanatory research and causal research that is combination of secondary data analysis and experiment. Exploratory research with secondary data analysis to know the situation and problem of national chili, while causal research with experiment to know the relationship between phenomenal model.
Data onto this research are primary and secondary data. Primary data obtained from the observation and direct interviews for the relevant sources include several farmer groups, merchant, and chili consumers, while secondary data obtained from relevant agencies include the Central Bureau of Statistics, the Department of Trade and the Department of Agriculture.
Solution to problem
Problem solving plot is a general step done in doing research. The problem solving flow is useful for providing information on the beginning of the research to the completion of the research. The following is a problem solving plot as an overview of the research undertaken
Basic Chain Supply Chain System
Supply chain as a system cannot be separated from the close relationship between components, as well as the supply chain system on horticultural commodities such as chili. Chili availability system is divided into three sub-systems namely sub-system production (manufacturer), sub-system distribution (supplier), and sub-system consumption (consumer). All three of these interconnected systems form a chili supply chain system (Figure 2).
The components of the supply chain in more detail as shown in Figure
The distribution and marketing system covered by the chili supply chain vary by region of production and market objectives. Chili supply chain is still largely targeted to meet the local, provincial and provincial markets for example: Jakarta, Bogor, Depok, Tangerang, Bekasi (Jabodetabek) markets, Banten markets and Bandung markets. The traders involved in the distribution of chilli are traders, wholesalers or wholesalers including suppliers of processing industries, and retailers, both traditional market retailers and modern markets (supermarkets, hypermarkets and supermarkets).Collecting traders acts as collectors and buyers of pepper production from farmers. Wholesalers, in addition to acting as buyers of the products of collecting traders and farmers, often also play the role of capital providers (informal finance institutions) for the farmers and collecting traders who are their accomplices. Capital loans to farmers can be in the form of money or nature (seeds, fertilizers, and medicines).In the supply chain institutional, farmers act as chilli producers, which is responsible for the production process of chili. Collecting traders act as collectors and buyers of pepper production from
Proceeding the 1stInternational Conference on Food Security Innovation 2017 ; 142 –160pSupply chain design of chili commodity…..146farmers. Wholesalers act as buyers of the products of collecting merchants and capital providers for the farmers and collecting traders who are their subordinates. Inter-island traders play a role in distributing inter-regional chili commodities, these actors usually have transport fleets, especially trucks and pickup trucks. Market retailers play a direct selling role to consumers in traditional markets and modern markets (Supermarkets, Hypermarkets and Supermarkets) that sell chilies to consumers directly in central consumption areas. In addition to knowing the supply chain chili pepper, another thing that is not less important is the marketing margin of chili on every component of the supply chain. The result of Hadi and Susetyo (2011) research on marketing margin analysis of red pepper in Jember District shows that during planting season I and II in 2011 amounted to IDR 37.250/ Kg. This margin is above the price of red pepper at the producer level of only IDR 20,750/kg. Indeed, between the margin value should be much smaller than the price at the producer level. The margin value consists of Share price received by farmers amounting to 35.78% of the price paid by the end consumer and amounted to 64.22% is the share of marketing margin. The total marketing margin of 27.40% is the marketing cost incurred by the four marketing agencies involved and then 36.82% is the advantage of the four marketing agencies involved. The description of the injustice of marketing share of red chilli in as indicated above indicates that the marketing process of chili has excess demand or undersupply chilli products. Therefore, the government tries to intervene in the market through imported chili actions from India, China and Vietnam. Nevertheless, the price of the product has not been any signs of decline even tends to increase until close to IDR 100.000/kg and even outside the region can reach above IDR 100.000/kg to IDR 150.000/kg. What a very irrational price. This means that the price of red chili is high at the consumer level and very low at the farm level, so the high price is only enjoyed by the traders involved in the marketing process. If the price of the sky is higher than the value of its marketing margin, it may still be accepted by economic logic. Viewed from the profit ratio aspect that the highest average ratio experienced by retailers and the lowest received by traders between regions (districts). This means that the level of fairness in receiving profits is very unfair compared to the proportion of costs incurred by each marketing agency. Supposedly the highest ratio experienced by traders between regions / districts with the highest marketing expenditure of each product Kg, not by retailers whose marketing costs on average only IDR 838 / kg. Symptoms of the high price of red chili due to bad weather so that production plummeted that led to a limited supply. However, the government has taken import actions from India, China, and Vietnam, but product prices remain expensive. Conceptual Model Supply Chain of Chilli 1.Problem Definition The dynamic model illustrates the interactions between elements that make up the chili supply chain system. The problem of chilli availability is a fairly complex system problem involving various components, variables in which interact and integrated. The availability of chili nationally can be viewed as a system dynamics problem that changes over time and is influenced by factors that are also dynamic. The purpose of modeling the availability of chili is to look at the pattern of chili availability in the future to improve national food security with a variety of scenario development alternatives that are in line with real conditions. The developed system dynamics model is limited to matters relating to the supply, supply and demand of chili. This model is made based on the identification of problems poured into the causal loop, formulated in stock and flow diagrams and simulated using Powers software.2.Identification of Key Variable In determining the level of national chili availability, researchers need to know the factors that affect the supply of chili. Based on the observation and literature study it is known that the national chili availability level is the difference between the production and consumption of chili. Chili
Proceeding the 1stInternational Conference on Food Security Innovation 2017 ; 142 –160 p147Ridwan et al.production is influenced by variables such as planting area, productivity, farmer household income, cultivated area, conversion of land, conversion and intensification of cultivated area. Constants are required as inputs to the model in addition to these variables, making it easier to modify the model in case of changes in accordance with the actual conditions. These constants include the percentage of additional planting costs, the area of planting area (intensification) per year, and the percentage of land conversion (conversion) per year. Chili consumption is influenced by variables such as chili production, household consumption, industrial consumption, aging for seeds and scattered. Chili consumption is strongly influenced by people’s behavior in consuming chili. Level of pepper needs can be seen from the dynamics of population development that is very influential on the demand for chili for consumption. The dynamics of this population model will produce output in the form of future population forecasts. The dynamics of population development are formed through the interaction between the variables of the population of Indonesia with the variable rate of population growth and the rate of death of the population that form a relationship. The greater the rate of population growth per year the greater the annual population, the greater the rate of death of the population, the less the annual population. The consumption pattern is based on population dynamics and the average requirement of chili for consumption is converted in kg/capita/year. Required variable (constant) level of chili consumption which input average chili consumption in accordance with real conditions to know the consumption needs of chili. Chili consumption level variables will further impact the positive effect on the amount of chili consumption. The greater the level of chili consumption per capita, the greater the amount of chili needed for consumption.In addition, the relationship between production and consumption of chili will affect the supply chain dynamics. In terms of supply or distribution there is a supply chain component which is described by several variables such as producer price, collectors, small traders, wholesalers, retailers, consumer prices, and income from RTs. The relationships among these variables will simulate how the effect of price changes on the producer level on prices in each other supply chain components.3.Reference ModelReference models related to the design of the chain’s dynamic supply chain model or the agricultural commodity supply chain model, Akhmad Mahbubi et.al (2013), entitled “The Dynamic Model of Sustainable Rice Supply Chain in National Food Security Efforts”. 4.Development of Causal Loop DiagramCausal simulation model is the basis of making the main model simulation. Causal simulation model is built based on the relationship between variables in the model (Japar et al., 2013) The Causal Loop Diagram relation explains the causal relationship between variables with each other. The relationships between these variables form a long chain of causal loops that will provide feedback on other variables. Causal Loop diagram explains about the causal relationship of supply availability level of chili influenced by the level of production, distribution (supply) and level of consumption. Causal Loop The diagram above illustrates the relationship between production, distribution and consumption of chili. A causal relationship with a positive sign (+) indicates if the dependent variable increases then the independent variable will increase. Similarly, the causal relationship with the negative sign (-) indicates if the dependent variable increases then the independent variable will decrease
Behavior of Chilli Supply Chain System for the Next 10 Years
Modeling the dynamics of chili availability system, model design, simulation and analysis is done by referring to the objectives and scenarios in each model. Some policy scenarios to be used in behavioral analysis. The chili supply chain system for the next 10 years is as follows:
Scenarios without Policy Change
This scenario is assumed as a simulation result without any policy changes such as government intervention to see system behavior over the next 10 years and determine the point of improvement whether in the production sub-sub-system, consumption sub-system or distribution sub-system (supplier).
1.Sub System Production
The production sub-system is related to matters affecting the production of chili, ie planting or harvest area, production, cultivated area and household income of chili farmers. Below is a projection result on chilli production sub system for 10 years ahead. From the simulation result, the value of chili harvest area and cultivated area increase every year, while chili production fluctuated or fluctuated during the next 10 years. The highest production occurred in 2024, which was 2,356,992 tons and the lowest was 2014 at 1,451,654 tons. Fluctuations in chili production is due to changes in the productivity of chili due to climate and crop failure due to pests or other natural factors. In terms of income RT chili farmers value increases every year where in 2025 income of RT chili farmers with an area of 0.1 ha of land is IDR 47,007,430 per year. This indicates that there will be an increase in the welfare of chili farmers and show the prospect of better chili farming business
2.Sub System Consumtion
The consumption sub-system is related to the things that affect the consumption of chilli, ie consumption of RT, industrial consumption, scattered and seeds. Here is a of projection result on chili consumption sub system for 10 years ahead.
3 Comparison of Chili Production and Consumption
Based on the simulation results show that the production rate of chilli is greater than the total use of chili in Indonesia. The following is the result of projected comparison of production and use of chili for the next 10 years.
4.Sub System Distribution (Supply)The distribution sub-system deals with matters affecting the distribution of chilies from producers to consumers. In the sub-distribution system the components involved consist of producers / chili farmers, collectors / wholesalers, small traders, wholesalers, and retailers. The focus of this sub-system on supply chain is the price margin from upstream to downstream of chili pepper supply chain.From the simulation result, the price of chilli turns up from year to year both side of producer and consumer. However, the price margin between producer price and consumer price is also higher. If left then it will cause harm both side of the manufacturer and the consumer side. Here is a table and graph of simulation results in chilli distribution sub-system for the next 10 years.To see the price differences in each component of the chili supply chain the following table 9 and price comparison charts on the chili supply chain components are presented.
The dynamic system model of chili supply chainis appropriate and acceptable so that the result of this research can be summarized as follows. First, the national chili system consists of several subsystems, including distribution or supply, production, and consumption. Each subsystem consists of elements or elements that are more specific and influenced by the development of time so that the national neglect system is dynamic. The national neglect system is cross-sectoral because it encompasses various related institutions, such as chili consumption subsystem related to population problem, whereas production subsystem is related to land area and agriculture cultivation. Second, the result of chili production subsystem is influenced by variables such as planting area, conversion of land, conversion, extensification, productivity and income of chili farmers. The distribution subsystem, the supply of chili depends on the price margin on the chili supply chain components composed of components of marketing and profit costs. Chili consumption is influenced by the behavior of people in consuming chillies on the consumption subsystem. Submodel consumption needs can be seen dynamics of the development of the population that is very influential on the demand for chili for consumption. Third, the result of scenario without policy change then chili food security will be sustainable with the value of production above the level of use of chili so that for the next 10 years food security for chili is still safe. However, the value of the price margin is higher so the improvement scenario is done to minimize the marketing margin value
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