Risk Mitigation on Supply Chain of Rice in Central Java Province and Special Region of Yogyakarta

Abstract

Rice is a vital commodity in Indonesia because it is the main staple food for most Indonesian people. Balancing supply and demand of rice in Indonesia is complex and possibly led to polemics, even though the production of rice in Indonesia tends to increase. An analysis of the supply-demand for rice commodity is necessary as an effort to improve the national rice condition along with the logistics and supply chain point of view. This study aims to analyze the supply chain risk management of rice to provide recommendations on improving rice supply chain performance on each tier. In this study, supply chain of rice mainly consists of farmer, collector who acts as trader, and retailer. Meanwhile, the role of government is represented by The Indonesia Logistics Bureau (BULOG). The different supply chain pattern can be identified from the role of middleman in each province. This study uses ISO 31000:2009 standard for analyzing the risk in each tier along the supply chain. Based on the risk analysis, on-farm activity plays a vital role in transferring risk along the supply chain in terms of quality and quantity. Risk mitigation of each tier is explored in this study.