EnglishSugar deregulation carried out by the government through INPRES No. 5, 1998 has liberated farmers from compulsory of cane planting. Formerly, the input of sugar raw materials to the factory was assured by the compulsory cane rotation planting by the farmers. Following deregulation, the compulsory planting was abolished. To fulfill the raw material needs, the factory was urged to offer more advantageous sharing system pattern and price level to the farmers. Alternatively that could be done is through sugar agribusiness unit development with vertical coordination where sugar factory as the initiator, motivator and coordinator. By doing so, the role of the government is limited on the effort of preventing a monopsonistic practices that ...