Factors Determining Smallholder Farmers to Upscale their Cattle Business

. The maintenance of beef cattle in Indonesia is mainly carried out by smallholder farmers, so to meet national demand, beef cattle population needs to increase. While the government-initiated programs to increase e cattle population are many, studies to analyze smallholder farmers’ interest to improve their cattle size remain limited. This study aims to analyze factors influencing the interests of smallholder farmers in improving their beef cattle business. The variables were farmers’ age, gender, education level, family size, land ownership, beef cattle ownership, monthly income level, and cattle breed. The potential obstacles farmers faced to increase their beef cattle business were investigated. Conducted in Blora, Grobogan, Kebumen, Klaten, and Rembang Regencies, Central Java Province, this study purposively selected 287 beef cattle farmers aged 15-24 years as study respondents. The collected data were then subjected to binary logistic regression analysis using Stata 16. The findings showed that farmers’ motivation to increase the population of cattle they raised was influenced by their age and monthly income. The older the farmers, the less probable they were interested in improving their business. Farmers earning >IDR 1,000,000.00-3,000,000.00 per month showed probability of interest in increasing their business by growing beef cattle population.


Introduction
Raising beef cattle has been a livelihood for rural communities in Indonesia for many years (Widi, 2015).The beef cattle business in Indonesia is 90% managed by smallholder farmers, of which 6.5 million farmers live in rural areas (Agus and Widi, 2018;Mayulu et al., 2010).
Smallholder farmers in Java usually own and manage 2 to 4 head of beef cattle and integrate their livestock with crop business (Widi, 2015).Smallholder farmers account for 65-70% of domestic beef production (Asikin et al., 2020;Setianto et al., 2014).For them, cattle serve as a source of income, an asset, an indicator of one's wealth status, and support for the family economy (Setianto et al., 2014).However, the lack of capital ownership, weak technology resources, and the lack of farmers' bargaining position has made the agribusiness system unable to appropriately apply to beef cattle farming (Ekowati et al., 2011).In addition, smallholder farmers face obstacles that prevent them from benefiting from market opportunities because farmers often live in remote areas with poor infrastructure and face high transaction costs that can reduce their profitability (Fischer and Qaim, 2012;Key et al., 2000).
The population of beef cattle in Indonesia in 2018 was around 17 million Direktorat Jenderal Peternakan dan Kesehatan Hewan, 2018).In the same year, the human population was 266.8 million.Indonesia's human population has been predicted to continue to increase to 305.6 million in 2035 (Statistics Indonesia, 2014), while Indonesia's domestic beef production can only meet 45% of domestic demand (Agus and Widi, 2018).In addition, the number of beef consumption in Indonesia is predicted to increase by 9% in 2022 (Meat and Livestock Australia, 2018).This increase in consumption rates is caused by population growth, urbanization, and increasing people's incomes (Delgado et al., 2001).Therefore, efforts can be made to meet the beef needs of the Indonesian people, among others, by increasing the population, production, and productivity of beef cattle (Mayulu et al., 2010).Currently, the beef cattle population in Indonesia is concentrated on Java Island, one of which is Central Java Province.Therefore, the growth number of beef cattle in Central Java will impact the country's population (Sunyigono et al., 2021).
The most crucial thing in developing the beef cattle industry in Indonesia is to improve the performance of smallholder farmers (Hadi et al., 2002;Setianto et al., 2014).Smallholder farmers on Java Island usually own and maintain two to four cattle raised intensively and integrate their agriculture with livestock business.It is certainly different from smallholder farmers in the Nusa Tenggara islands, where each smallholder farmer has 5 to 50 cattle that are reared extensively (Widi, 2015).The government has made programs to increase the beef cattle population, such as Upaya Khusus Sapi Indukan Wajib Bunting (UPSUS SIWAB).However, smallholder farmers face several obstacles in increasing production and marketing.The obstacles include the low quality and quantity of feed (especially during the dry season), the slow process of adopting technology to increase beef cattle productivity, and limited market access.In addition, lack of financial access causes farmers cannot afford to buy males, brooders, and machines for cattle houses (Asikin et al., 2020;Permani, 2013;Priyanti et al., 2012;Waldron et al., 2012).Another obstacle is farmers' age, who is getting older, and the farmers do not have an heir who wants to continue their business.Young people prefer to migrate from rural areas rather than continue their family farm businesses (Cavicchioli et al., 2018).
Several studies have been conducted on farmers' interest in developing their businesses.For example, research on the intention of dairy farmers to improve management practices of foot injuries that cause lameness in dairy cattle was conducted by Dutton-Regester et al. (2019).This study determines the interest of farmers in improving the management of foot lameness in dairy cattle.Another research is factors influencing the interest of farmers in adopting the use of fertilizers based on the results of soil tests (Daxini et al., 2018).Research conducted by Daxini et al., (2018) on farmers in Ireland stated that farmers' intention arises from the influence of their socio-economic characteristics, applicable policies, and resources received.Research on the interest of smallholder farmers to increase business scale by increasing the population of their beef cattle needs to be carried out in Indonesia, considering that currently, the program to increase the population of beef cattle continues to be carried out in Indonesia to meet national needs.The results of this study are expected to be considered in formulating a development strategy for the beef cattle business for smallholder farmers by considering the farmers' socio-economic characteristics.Therefore, this study aims to determine the socio-economic factors that influence the interest of smallholder farmers in increasing business scale.

Materials and Methods
This research was conducted from March 2021 to February 2022 in Blora, Grobogan, Kebumen, Klaten, and Rembang Regencies, Central Java Province.Central Java province was chosen as the research area because it has more than 60% beef cattle farming households (Statistics Indonesia, 2013).In addition, this province will have a beef cattle population of 1,863,327 heads in 2021, as well as being the second province that produces the largest beef cattle population in Indonesia, after East Java Province (Statistics Indonesia, 2013).
Respondents were selected using purposive sampling with the criteria of respondents being beef cattle farmers who were at least of a young age (15-24 years) according to the National Planning and Development Agency (2022) requirements.When a person is between the ages of 15 and 60, the corresponding person is considered to be of productive age (Nul Hakim, 2020).Based on the purposive sampling method, a total of 287 respondents met the respondents' qualifications, (Blora 90; Kebumen 36; Klaten 36; Grobogan 72; and Rembang 53 respondents).The data collection was conducted through a survey with a structured questionnaire and direct interviews with the farmers.The data obtained from this study were analyzed using descriptive analysis to determine the social characteristics of farmers and binary logistic regression analysis to determine the factors that influence the farmers' interest in increasing the beef cattle population.In this study, Stata 16 was employed for the data analysis.The range of income per month received by the respondent (categorical) 1 = ≤ IDR 1,000,000.00; 2 = IDR 1,000,000.00-IDR 2,000,000.00;3 = IDR 2,000,001.00-IDR 3,000,000.00;4 = IDR 3,000,001.00-IDR 4,000,000.00;5 = IDR 4,000,001.00-IDR 5,000,000.00;6 = > IDR 5,000,000.00)Cattle Breed Number of cattle breeds (dummy, 1=only Peranakan Ongole (PO) cattle; 0= PO cattle and others) Binary logistics regression is an analysis used if the dependent variable is binary or dichotomous (Hosmer et al., 2013).In other words, the Y variable has two categories (not interval or ratio scale).To make the two categories easier for a statistical software program to process, they are typically recoded as "1" and "0." Regular linear regression models (whether simple or multiple) are inappropriate in these circumstances (Fritz and Berger, 2015).The dependent variable (Y) in this study is farmers' interest in increasing the beef cattle population, which is dummy (1 = eager to increase population; 0 = do not eager to increase population).The independent variables used in this study included age, gender, education, family members, land ownership, livestock ownership, income level, and cattle breed.Definitions for each variable showed in Table 1.
In this study, the logistic regression model characterizes the interest of beef cattle farmers to increase the population of beef cattle that are kept, determined by the following equation: where subscript i denotes Observation: "i" -th in the sample; Pi is the probability of the outcome; β0 is the intercept; β1, β2, …, βk are the regression coefficient of the variables X1, X2, ..., Xk, respectively (Daxini et al., 2018), (Timprasert et al., 2014).If the coefficient is positive, it indicates an increase in the log probability, that is, the possibility of farmers increasing the population of their beef cattle.

Farmers' Characteristics
The farmers' characteristics in this study are presented in Table 2.The data were divided into two groups: the farmers who were not eager to increase the cattle population (n = 86) and those who were eager to increase the cattle population (n = 201).Characteristic data included farmers' age, education level, number of family members, land ownership, and livestock ownership.A two-sample t-test for the two groups was conducted to determine the difference in the mean of the two groups.Table 2 shows that farmers who are reluctant to increase their population are 53 years old, while their counterparts are 48 years old.There was a statistical difference (P<0.01) in age between the farmers who are reluctant to increase the cattle population and those who were eager to increase the cattle population; likewise, in terms of education (P<0.1) and the number of family members (P<0.05).Farmers eager to increase the beef cattle population were at their productive age.Productive ages' farmers will find it easier to develop the livestock business they have been running (Sahala et al., 2016).Farmers eager to increase their beef cattle population had a higher level of education than the reluctant ones.The former averagely earned education up until the first year of Junior High School, while the latter were generally Elementary School graduates.Individuals with higher level of understanding and knowledge are more productive workers because of their level of education (Hidayat et al., 2021;Saputra et al., 2022).
The average family size of farmers who were reluctant to increase their cattle population was three people, while that of their eager counterparts was four people.It has been reported that the size of productive family members in the beef cattle business greatly influences work productivity and ability to manage the business (Sahala et al., 2016).
The farmers who were reluctant to increase their cattle population by far were averagely older, pursued lower education, and had fewer family members than their eager counterparts.However, the amount of land and livestock owned by both groups of farmers did not differ statistically.The average land size and number of cattle owned by farmers who were reluctant compared to those eager to increase the population was 1,473 m 2 and 2.39 TLU vs. 1,889 m 2 and 2.20 TLU, respectively.
Descriptive statistics were also based on nominal research data, such as gender, farmers' income, and cattle breeds.Cross tabulation between gender and interests of farmers, the range of income and interests of farmers, and breed of cattle and interest in raising livestock, respectively, can be seen in Tables 3, 4, and 5.
Table 3 shows that the number of male and female farmers is not statistically different.The number of male and female farmers in this study was 169 vs. 118 people, respectively, consisted of 45 male and 41 female farmers who were reluctant to increase the population, and 124 male and 77 female farmers who were eager.Overall, farmers eager to increase the cattle population outnumbered the reluctant ones.
Table 4 shows farmers' range of monthly income.A total of 126 farmers earned IDR 1,000,000.00,which was much smaller than the provincial minimum wage in Central Java Province (IDR 1,812,935,00) based on Government Regulation Number 36 of 2021.Only eight farmers earned more than IDR 5,000,000.00per month, while 153 farmers have an average income between IDR 1,000,000.00-IDR 5,000,000.00.The cattle farmers' income increases with the quantity of livestock sold, hence the more livestock sold, the more income received by farmers (Indrayani and Andri, 2018).
Table 5 shows that the cattle breed kept by farmers are divided into two groups PO cattle, and the farmers' group does not only raise PO cattle.PO cattle are local breeds widely cultivated in Central Java, with a population of 51.3% (Kusuma et al., 2017).It can be seen in Table 5 that the number of farmers who only raise PO cattle is more than the number of farmers who do not only raise PO cattle.Farmers who not only raise PO cattle mean that farmers have kept cattle of other breeds.Cattle of other breeds are usually crossbred cattle, such as Simmental-PO cattle and Limousin-PO cattle.The majority of farmers in both groups were eager to increase their cattle population.Compared to cross-bred cattle, PO cattle require less labor, less capital, and less feed (Widi et al., 2015).However, crossbred cattle have higher selling price than PO cattle (Agustine et al., 2019), thus cross-bred farmers have a higher income than PO farmers (Agustine et al., 2022).

Factors Affecting Farmers' Interest to Increase Cattle Population
The logistic regression analysis results show that the model has a Prob>chi2 value of 0.0018.In other words, all the information used in this model can significantly explain farmers' interest in increasing the scale of the beef cattle business.In the regression analysis model, two of three independent variables have a "baseline."These variables include gender, income, and cattle breed.In the "gender" variable, code 0 (male farmer) serves as the "baseline"; on the variable "income," code 1 or income ≤ IDR 1,000,000.00serves as the "baseline"; and in the variable "cattle breed," code 0 or farmers who maintain not only PO cattle serves as the "baseline."The baseline serves as a comparison for dummy or other categories in the same variable.The binary logistic regression results with the regression coefficient values are shown in Table 6, and the results of the analysis of the marginal effects are shown in Table 7.
Table 6 shows that age is a significant factor (P<0.05) to the interest of farmers to improve their business scale by growing the number of cattle.The regression coefficient shows that the older the farmers, the more reluctant they became to increase cattle population.Similarly, Brown et al. (2019), who state that older farmers will tend to refuse, are reluctant to trial-anderror attempt, or are not easily conform to social expectations and focus more on financial performance.They also demonstrate reluctance to adopt new technologies and low probability to orchestrate solid plans to convert land and intensify existing land use.Research on the impact of the age structure on the technical .efficiency of agriculture in Thailand stated that while workers aged 60+ contributed to inefficient technicality issues, and those aged 15-59 years could improve technical efficiency in agricultural production (Saiyut et al., 2019).This present study confirmed the findings by Sahala et al. (2016) that the older the farmers, the fewer the cattle they owned because they had less intensity and attention to raise their cattle.Another contributing factor to farmers' interest to increase their cattle population is income (P<0.05and P<0.1).Farmers who earned IDR 1,000,000,00 -IDR 2,000,000.00monthly would tend to increase their cattle population compared to farmers who earn ≤ IDR 1,000,000.00per month, as well as farmers who have a monthly income between IDR 2,000,001.00-IDR 3,000,000.00per month.Income strongly influences farmers' interest in increasing the scale of the beef cattle business (z=2.44).Limited capital and dependence on family labor make farmers only have small-scale beef cattle farms business.They are often faced with the problem of low livestock productivity, scarcity and low quality of forage, and the unavailability of concentrated feed.They also have difficulty meeting their families' needs with food and income.On the other hand, they prefer artificial insemination because they assume it can increase beef cattle's productivity by producing good offspring.However, artificial insemination is relatively expensive and selffunded.Moreover, artificial insemination is not always successful due to transportation problems and long distance between the inseminator and the farmer (Gayatri and Vaarst, 2015).
The results of the marginal effect analysis in Table 7 show that for every 1 unit increase in age, the probability of farmers to grow their cattle population will decrease by 0.00781 or 0.78%.If farmers earning IDR 1,000,000.00-IDR 2,000,000.00per month had a higher income, their probability to have more cattle was 0.16196 or 16.19% higher than those earning ≤ IDR 1,000.000,00per month.Similarly, if farmers earning IDR 2,000,001.00-IDR 3,000,000.00per month had a higher income, they would have a 0.15389 or 15.39% higher probability of increasing their cattle population higher than farmers earning only ≤ IDR 1,000,000.00per month.Farm management operated by smallholder farmers hold on to the belief that that business motivation is solely based on economic benefits.There are three factors related to motivation: interests, needs, and ambitions or determination.Previous studies have shown the importance of the interest factor.When doing agricultural work based on interest or preference, there is a positive relationship with income.Furthermore, the "ambition or need" factor describes the relationship of an individual's economic accumulation to the possible needs of their personal and family (Maican et al., 2021).Based on the interviews with farmers, farmers were reluctant to increase their cattle population due to several limitations, including cages, labor, capital, human resources due to old age, and feed due to cost.Meanwhile, farmers were eager to increase cattle population as an investment, hobby, additional income, and pride.
Responding to the problems that arise from the study results, a strategy is needed to overcome the problem of age and capital to overcome economic obstacles in increasing the scale of the beef cattle business.The most important thing to overcome the problem of aging farmers is to foster farmer regeneration.Regeneration is equivalent to inheriting or handing over agricultural businesses, bringing new players into the agricultural business (Anwarudin et al., 2020).The problem of aging in society is faced by both developed and developing countries, which will impact business productivity in the agricultural sector.Older farmers are less productive than younger farmers (Zou et al., 2018).Farmers' regeneration processes, approaches, and strategies can perform through family role improvement, agricultural extension, communities, agricultural modernization, and farmer corporations.The strategy for applying respect, socialization, and inheritance of agricultural businesses can be done through the role of the family while strengthening the institutions of young farmers and consulting through the role of agricultural extension workers.Communities can play a role in socialization, information transfer, and consultation.Agricultural modernization can be done through agricultural mechanization and digital farming.At the same time, corporate strategies can be developed to attract youth because it opens opportunities for the availability of economically viable land and the use of agricultural machinery and increases farmers' bargaining position (Anwarudin et al., 2020).
Furthermore, potential strategies to overcome farmers' limited capital included the formation of livestock groups, the establishment of cooperatives, and the development of collaborations.Farmer groups play a significant role in devising strategies for managing finances, elevating beef cattle, and planning to improve livestock productivity (Sugiarto et al., 2021).Livestock groups provide access to capital for farmers through credit, knowledge transfer, and market access (Castella and Bouahom, 2014), while cooperatives enable organizations and companies to collaborate to achieve a goal.Collaborative strategies (e.g., cooperatives-joint ventures) are a way to overcome their size constraints and succeed in an increasingly competitive market environment (Matopoulos et al., 2005).Support from the government and the private sector through capital, assistance, and training for smallholder farmers is essential to increase beef cattle production (Rustinsyah, 2019).

Conclusions
Age and monthly income are two contributing factors to farmers' interest to expand their beef cattle business through growing cattle population.This study concluded that farmers' desire to increase cattle population decreases with age, and mostly younger farmers condoned to grow their business.Furthermore, farmers interested to increase their cattle population earn between IDR 1,000,000.00and IDR 3,000,000.00per month.Strategies to address the first issue of aging farmers included fostering farmers' regeneration through the roles of family and community, agricultural extension and modernization, and farmer corporations.Meanwhile, the low-income farmers' limited capital can be solved by forming livestock groups, establishing cooperatives, and developing collaborations.

Table 1 .
Variable Definition

Table 3 .
Cross tabulation between gender and breeder interests

Table 4 .
Cross tabulation between farmer's monthly income and farmer's interest

Table 5 .
Cross tabulation between breeds of cattle kept and breeders' interest