Evamping the Supply Chain of Fruit and Vegetable in East Java Province, Indonesia

Population growth and improved public awareness of health have resulted in an increase in the demand for fruits and vegetables from year to year, both in quality and quantity. Unfortunately, the increase in the demand for fruits and vegetables has not been supported by the availability or the supply of the products from production centers, thus resulting in an increase in imports of fruits and vegetables in order to meet the domestic demand. There are many factors that lead to the lack of products supply to market every year and this cycle occurs repeatedly, that is, harvest time –abundant products - price falls – unsold fruits and vegetables are rotting. Referring to the problem above, the argument commonly expressed by the government is that the problem is caused by bad trade system and limited innovation or technology. Trade system is still controlled by a handful of economic operators (wholesalers) that control the prices completely. At the same time, the information received by the farmers is very little. The products harvested cannot be distributed to other areas quickly due to the constraints in information, transportation and distribution networks. Furthermore, ignoring technology or product innovation makes most fruits and vegetables become perishable. Refrigeration or storage technology is urgently needed to extend the age of commodities (fruits and vegetables) so that the quantity of supply to the market can be regulated well and the prices would not be interfered. This problem, however, has not been handled well up to now, whereas the acceleration of commodity damage can be avoided if not all commodities are consumed in the form of raw materials. They should be processed first to achieve price stability and high added value