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Abstract

This study aims to optimize profit margins for farming businesses in Moncongloe Lappara Village through a "Sell or Process Further" tactical decision analysis. Farmers often sell raw grain for liquidity, disregarding potential lost added value. Using a quantitative descriptive approach and Differential Cost Analysis, this research compares the profitability of selling Dry Harvested Grain (GKG) versus processing it into rice. Field data simulations based on a 1-ton input indicate that further processing yields an additional net benefit of IDR 942,000 per ton, equivalent to a 12.5% margin increase compared to direct selling. Another significant finding is that by-product sales (bran) cover 82% of incremental processing costs, thereby minimizing operational risk. Consequently, the further processing strategy is shown to be feasible and recommended to enhance the economic welfare of local business owners.

Keywords

Differential Cost Analysis Sell or Process Further Rice Milling Margin Optimization Value Added

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How to Cite
Rum, M., & Fachmy Rum, H. (2026). Optimizing Milling Margins: Implementing Sell-or-Continue Decisions in Paddy Production in Moncongloe Lappara Village, Indonesia. Golden Ratio of Mapping Idea and Literature Format, 6(2), 1482–1489. https://doi.org/10.52970/grmilf.v6i2.1952
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