Sheep Marketing Chain Transformation: Efficiency Analysis and Partnership Model for Sustainable Economic Value Creation

Julia Marisa and Sukma Aditya Sitepu
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Julia Marisa: Master of Agricultural Sciences Program, Universitas Pembangunan Panca Budi, Indonesia.
Sukma Aditya Sitepu: Department of Animal Science, Universitas Syiah Kuala, Indonesia.

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Abstract: Aims: This study aims to analyze the efficiency of the sheep marketing chain in Binjai, map the existing marketing chain structure, and design an optimal partnership model to increase the bargaining power of livestock breeders. Study Design: The study used a mixed-methods survey of 126 respondents: 60 livestock farmers, 23 village collectors, 14 inter-regional traders, 10 regional market traders, and 19 retailers/butchers. Place and Duration of Study: The study was conducted in Binjai City, Indonesia. The research period was carried out for 3 months, from May to July 2025. Methodology: Data were analyzed using the Marketing Efficiency Index (MEI), Concentration Ratio (CR4), Herfindahl-Hirschman Index (HHI), and Willingness to Participate Index. Primary data were collected through structured questionnaires, in-depth interviews, direct observation, and focus group discussions (FGDs). Results: The sheep marketing chain has an IEP of only 42.3%, with farmers receiving 68.5% of the consumer price. The market structure is oligopsony, with CR4 reaching 76.3%. The main inefficiencies are information asymmetry, limited infrastructure, and weak bargaining power of farmers. The Multi-Party Partnership Model with digital integration achieved 73.4% acceptance and is projected to increase the IEP to 61.7% and the farmer's share to 76.2%, providing an additional income of IDR 1.77 million per year. Conclusion: This study recommends strengthening digital integration and participatory governance to increase livestock farmers' bargaining power. The findings provide a framework for policymakers to improve livestock market efficiency and equitable value distribution.

Date: 2025-11-22
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Published in Journal of Global Economics, Management and Business Research, 2025, 17 (3), pp.396-405

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