DOI: 10.36347/sjebm.2018.v05i07.001

Pages: 552-561

Free trade in making cassava must have a comparative advantage in order to compete in domestic and international markets. However, the obstacle is the growth of the year, the population of Indonesia is increasing so that the production of cassava has not been able to meet national needs and cause more imports. Pogalan Village is one of the producers of cassava which has the potential to develop agriculture competitively. The objectives of this research are 1) To analyze the financial and economic benefits of cassava farming in Pogalan village, 2) To analyze comparative advantage of cassava in Pogalan village, 3) To analyze the sensitivity level of comparative advantage to inorganic fertilizer, cassava price increase and exchange rate. The analytical methods used are financial and economic analysis to analyze the feasibility of farming, Domestic Resource Cost Ratio (DRCR) to analyze comparative advantage and sensitivity analysis to analyze the sensitivity of comparative advantage. The result of the research shows that in Pogalan village has economic and financial feasibility with R/C Ratio of 2.85 and 1.26 respectively, meaning that cassava farming has financial and economic feasibility. Cassava cultivation in Pogalan village has a comparative advantage with DRCR 0.64, efficient if produced domestically. The first sensitivity assumption is that there is an inorganic fertilizer price increase of 10% and 20%, obtained respectively by DRCR 0.74 and 0.75. Second, there was an increase in the rupiah exchange rate against the US dollar by 5%, 10% and 20% obtained by DRCR respectively 0.67, 0.62 and 0.55. The second assumption is that agriculture deserves to be developed and the use of economically efficient resources. The suggestion is that in enhancing comparative advantage, farmers need to optimize intensive maintenance, resulting in higher productivity.