Risk Mitigation Strategies in Semi-Organic Rice Supply Chains: Lesson Learned from the Involved Actors

Abstract

Rice is the main consumption food for Indonesians. The demand for food increased from 114.6 kg per capita in 2016 to 124.89 kg in 2017. However, rice farmers and supply chain actors in rice agribusiness have experienced high challenges, such as production, transportation, price, product quality, and the environment. This research aimed to understand actors involved in the supply chain, their perception of occurring risks, and evaluation and risk mitigation in the supply chain. This was a quantitative descriptive study done purposively in Watugede Village, Singosari Sub-District, Malang Regency. Non-probability sampling was taken to gather primary data. The respondent of this research was 16 involved actors, from on-farm actors to consumers. The data were analyzed using the Fuzzy analytical hierarchy process (FAHP) to provide descriptive risk mitigation strategies. The results show that six involved actors are suppliers, farmers, grinders, traders, and buyers. Each actor faces different risks, and thus, the recommended mitigation strategies are adjusted to their risks. Sharing information, optimizing the level of supply availability, measuring supply chain performance, and building more coordination with the government are the best strategies to mitigate risks.

Keywords

• mitigation
• rice
• risk
• supply chains