Study of Investment in the Organic Fertilizer Industry to Improve Community Economists

Based on the results of observations of organic waste in the village of Jogotirto Berbah, Sleman, it is known that the amount of household organic waste and cow dung from 2015 to 2020 continues to increase by ± 12% per year. In Jogotirto, the average person produces 0.36 kg of organic waste per day and 15 kg of dry cow dung per day. In 2020 the amount of household organic waste is 8,477 kg per day, while for cow dung is 16,787.75 kg per day. Analysis of the study of the establishment of the organic fertilizer industry is carried out by processing household organic waste and solid cow dung by fermentation. This fermentation process is carried out anaerobically for 21 days. The organic fertilizer processing process is carried out by mixing cow dung and household waste with varying ratios. From the results of research on making organic fertilizer, it is known that a mixture of cow dung and household waste with a mixture ratio of 2: 1 contains nitrogen compounds as much as 1.04%, organic C 17.6%, phosphorus 1.7% and potassium as much as 7.02%. Based on the analysis of investment feasibility using the Net Present Value method, the fertilizer industry can generate a profit of 200.18% for 5 years. Analysts using the ROR method can provide a profit of 31.7% per year and the analysis using the pay back method is known that the period of capital will return after 3.85 years. Based on the sensitivity test of the fertilizer industry, it is still said to be safe for changes in influencing parameters, namely the sensitivity rate of 20%. This study of the establishment of the organic fertilizer industry aims to provide advice to the government in the context of improving the community's economy.

Market power or efficiency? An empirical study on the Indonesian fertilizer industry

This article aims to analyze the Indonesian fertilizer industry's market structure, efficiency, and performance determinants. This study applies the Structure-Conduct-Performance (SCP) framework proposed by the Harvard (market power) and UCLA-Chicago School (efficiency structure) schools of thought. We run Data Envelopment Analysis (DEA) and panel data regression to analyze the panel data constructed from annual reports of fertilizer producers in 2008 – 2017 and statistical publications from the agriculture ministry. DEA is a nonparametric method that measures technical and scale efficiencies. Meanwhile, panel data regression estimates the determinants of firm performance (ROA). The results show that the fertilizer industry has market power based on three characteristics; the number of incumbents (five), degree of market concentration (95.48 percent), and barrier to entry condition. Meanwhile, its industrial technical efficiency score is low (0.584), but its scale efficiency score is high (0.950). The results also show that firm performance is determined by efficiency, not market power. Both technical and scale efficiency positively and significantly affect performance. On the other hand, market power does not significantly affect performance. This finding supports the UCLA-Chicago School that efficiency is the main factor of firm performance.

A Comparative Analysis of Environmental Management System Implementation in Fertilizer Industries: Case Study of PT Pupuk Kaltim, PT Pupuk Kujang, and PT Petrokimia Gresik

Considering Indonesia as an agricultural country, it certainly needs a support to have an adequate supply of fertilizer. Currently, the development of the fertilizer industry in Indonesia is quite rapid. Due to a large demand of fertilizers, the fertilizer industry is trying to provide good quality products to ensure customer’s satisfaction. In addition to improving product quality, fertilizer producers in Indonesia also strive to environmental management system aspects as an effort to implement ISO 14001:2015. The objective of this study is to analyze the comparison of environmental management system implementation among fertilizer producers in Indonesia, namely PT Pupuk Kaltim, PT Pupuk Kujang, and PT Petrokimia Gresik. The three fertilizer producers were chosen since they had already received ISO 14001: 2015 certification. The method used in this study is a qualitative method by analyzing and interpreting the data that has been obtained. The results show that the implementation strategies in environmental management carried out by the three fertilizer producers are not much different, almost all of them have the same strategy in terms of environmental management. However, PT Pupuk Kaltim has superiority in environmental management compared to its competitors, it is proven by the achievement of the PROPER gold at three consecutive years, while PT Pupuk Kujang and PT Petrokimia Gresik merely achieved the PROPER green category.