Do Strategic Food Price Changes Affect The Welfare Of Food Crop Farmers In Bali?

Abstract

Fluctuations in food commodity prices in Bali affect the stability of food prices which have an impact on people's welfare. This study aims to analyze the effect of the prices of seven main commodities—rice, shallots, garlic, red chilies, cayenne pepper, cooking oil, and granulated sugar—on Famers Term of Trade (FTT) to Crops (Y), which represents overall food prices in Bali during the period from January 2019 to December 2023. The FTT value reflects the welfare of food crop farmers. The method used is multiple regression with secondary data obtained from the Strategic Food Price Information Center (PIHPS) and other market sources. Regression analysis shows that the prices of rice (X1), shallots (X2), and cooking oil (X6) have a significant effect on FTT to Crops (Y), with a coefficient of determination (R²) of 0.701, which explains 70.1% of the variability in food prices. The simultaneous test (F) confirms that the overall regression model is significant (p-value <0.05), while the partial test (t) shows that the price of rice and shallots has a stronger influence compared to other commodities. This study suggests increasing domestic food production, strengthening food distribution, and responsive import policies to reduce the impact of price fluctuations on people's welfare. These results have important implications for food security policies in Bali.