Profitability and Determinants of Smallholder Commercial Vegetable Production

If growers can step up from subsistence production to intensive commercial farming, there should be an impact on their welfare. Profitability of vegetable farming and factors that determine farmers’ intentions to commercialize vegetable-based enterprises in rural areas were examined using factor share and multiple regression approaches. Personal characteristics, changes in technology, and factors affecting the business environment were hypothesized to influence farmers to commercialize vegetable farming. A quantitative survey was used to obtain data from 356 respondents in four vegetable-producing regions of rural east Java and Bali, Indonesia, during 2013–2014. Vegetable farming returns profits. There is an opportunity to expand vegetable-based agribusiness by making farm credit, market information, and crop management technologies more accessible to farmers. To encourage commercial vegetable farming, vegetable agribusiness terminals, with all market infrastructures, could support vegetable production in rural Indonesia. The rural community could profitably engage in vegetable-based enterprises to increase farmers’ income.