*Student of Post Graduate Program, Agricultural Economics Department, University of Brawijaya, Malang, Indonesia
**Lecturer, Agricultural Economics Department University of Brawijaya, Malang, Indonesia
***Proffesor, Agricultural Economics Department, University of Brawijaya, Malang, Indonesia
Online published on 22 April, 2015.
Sugarcane field in Indonesia has been developing over 20 years, but the rising field is not numerous improvement. That's the reason that sugar production is low in growth. There should have been factors influenced the sugarcane field expansion in Indonesia. That's the reason there is a need to conduct a research what factors influence sugarcane field expansion in Indonesia.
The result of research said, price of sugar is the factor influences sugarcane field in Indonesia. The higher price of sugar the more opportunity for sugarcane field to expand with coefficient regression of 18.67. Farmers grow sugarcane have liberated decision which doesn't depend on the prices of paddy and maize, either on lending of interest rate.
After the factor has been found, the research is continued with the scenario how if the farmer's floor price is increased 30% in order to rise price of sugar. The result gave effect on raising of sugar price of 14.4%, and both sugarcane and sugar production will rise 4.7%. It measures that increasing floor price can be made use of government policy instrument to build up sugar price which links to sugarcane field expansion as well as sugarcane and sugar production improvement.
Sugarcane field expansion, sugarcane production, sugar production, sugar, sugarcane
