Reducing Risks Of Income Of The Small Dry Land Maize Farmers In East Nusa Tenggara Province, Indonesia

Abstract

Maize is an important staple food for small dry land farmers in the East Nusa Tenggara (NTT) Province, Indonesia. This research was conducted to investigate factors influencing maize farmer’s income, level and source of income risk; and recommended strategies to reduce the risk involving 170 small farmers. Data were analyzed quantitatively using income and risk analysis, variation covariance, and multiple regressions, applying the revenue function and error component model. The results showed that the income of maize farmers was low, and all income risk factors are categorized as low-risk. Furthermore, all the income factors significantly affected the farmers’ income, but production and selling prices were the most important income factors. Other income factors, such as the costs of seeds, fertilizers, pesticides, labor and land area caused no effect on the farmers’ income. The main source of income risk in dry land maize farming was high labor costs, which caused low productivity and profitability. Therefore, improving land productivity through the use of appropriate and intensive modern technology and improving the skills of workers are the main strategies to reduce the income risk and to increase the income of small farmers in dry land areas.