Abstract
The objectives of this study were to compare farmer’s perception regarding different schemes, calculate break even price of cassava production, analyze supply respond of cassava production and analyze co-integration on cassava prices. The paper found that farmers preferred income guarantee scheme to pledging scheme. Since 2003, farm prices had increased above break even price. Supply response of cassava mainly depended on price received in the previous year. This price related to government policy in two different schemes: income guarantee scheme to pledging scheme and cassava used as alternative energy. This study applied co-integration analysis for farm price with wholesale price and F.O.B. price for cassava. Farm price was affected positively by wholesale price and F.O.B. price. The estimated coefficients associated with explanatory variable agreed with a priori expectations, and were statistically significant. Signs of all estimated coefficients agreed with expectations and were statistically significant.
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