Coping up with the Risk, Increasing Sustainability; Strategies for Small-Scale Shrimp Farming in Indonesia

Suggested Bibliographic Reference: Challenging New Frontiers in the Global Seafood Sector: Proceedings of the Eighteenth Biennial Conference of the International Institute of Fisheries Economics and Trade, July 11-15, 2016. Compiled by Ann L. Shriver. International Institute of Fisheries Economics and Trade (IIFET), Corvallis, 2016.Proceedings of the Eighteenth Biennial Conference of the International Institute of Fisheries Economics and Trade, held July 11-15, 2016 at Aberdeen Exhibition and Conference Center (AECC), Aberdeen, Scotland, UK.Small-scale shrimp farmers have contributed significantly to the increasing of shrimp production in Indonesia. In line with increasing production, they have also faced with various risks, thus resulting in high fluctuation of their income. Risk management strategies are needed to cope the risks and to increase their sustainability in shrimp farming. The research analyzed the various factors of risks and possibilities ex-ante and ex-post coping strategies for small-scale shrimp farmers in Indonesia. A field survey of 166 shrimp farmers was conducted in the North and South coastal zone of East Java, Indonesia. The result revealed that the cluster of production risks was the main risk in shrimp farming, following by clusters of price risk, financial risk, personal risk, and institutional risk. The top three important factors of risk that influenced in shrimp farming were high mortality due to shrimp diseases, price shrimp volatility, and lack of capital to operate shrimp farm. Related with ex-ante on-farms strategies, following better management practices, use shrimp fries from certificated producers, and strictly in feeding management is the best strategies. Furthermore, subsidy or incentives to influence production practices at the farm level and sharing the risks through insurance, contract for input and output are possibilities strategies for government support and risk sharing, respectively. In ex-post strategies, generating alternative income activities, communities or informal insurance, and adjustment of labor use are the kinds of on-farms strategies. Moreover, the government supports in ex-post strategies is a loan with flexible repayment schedules