Risk perception and risk reduction efforts of red chili business in Langkat Regency North Sumatera Province

Abstract

The process of supplying red chili is not fully controlled by the farmers. The main factor that causes it is that the red chili farmers are small-scale farmers whose production decision-making process is thought not handled by a good forecast of production and prices. This is due to the influence of different perceptions of farmers in deciding which farming strategy to use. Therefore, it is necessary to carry out research on the relationship of risk perceptions to risk management strategies for red chili farming in Langkat Regency, North Sumatra Province. The data used are primary data sourced from questionnaires and interviews with 112 red chili farmers in Langkat Regency. The analysis method used is the Pearson Correlation to see the relationship between farm risk management strategies and perception. The results showed that the correlation of the risk perception variable and risk management strategy had a strong, significant and unidirectional effect on the red chili farming.