The Agroindustry Development Strategy for Java Ijen-Raung Arabica Coffee, in Bondowoso Regency, East Java

Abstract

The potential of Java Ijen-Raung Arabica Coffee in the Bondowoso Regency, East Java needs to be increased by developing the downstream agroindustry. This study aims to determine the location of the downstream coffee agroindustry development area and its potential products, determine the added value of downstream coffee products, analyze its financial feasibility, and formulate a development strategy. Research methods used in this study include factor weighting, exponential comparison method, interpretive structural modeling, Hayami method, and financial feasibility analysis. The results showed that the development of the Java Ijen-Raung Arabica Coffee agroindustry was prioritized in Sumberwringin District as a development center. Downstream coffee products that have the potential to be developed are ground coffee. The added value generated from the processing of ground coffee is IDR 9,320/kg, with a value-added ratio of 48.09%. The results of the financial feasibility analysis show that the downstream coffee agroindustry is financially feasible to be developed by business actors. The downstream agroindustry development strategy formulation for Java Ijen-Raung Arabica Coffee refers to the key development sub-elements, i.e. increasing market area, monitoring product quality, and involving stakeholders in its implementation.