Farmer Capability, Digital Literacy and Sustainable Rice Farming

Climate uncertainty, sustainability pressures, and market volatility continue to challenge the resilience of smallholder-based agri-food systems in emerging economies. This study examines how farmer capability and sustainability orientation influence adaptive farming practices and livelihood sustainability among Indonesian smallholder rice farmers within the context of sustainable and digitally supported agriculture. Drawing on the Resource-Based View (RBV) and Dynamic Capabilities Theory (DCT), farmer capability is conceptualized as an internal strategic resource, while adaptive farming practices represent the behavioral mechanism through which farmers respond to environmental and market uncertainty. Digital literacy is incorporated as a moderating factor. Using Partial Least Squares Structural Equation Modeling (PLS-SEM), this study analyzes survey data from 315 smallholder rice farmers in Indonesia. The findings show that farmer capability and sustainability orientation significantly enhance adaptive farming practices, which subsequently improve livelihood sustainability. Adaptive farming practices also significantly mediate the relationships between farmer capability, sustainability orientation, and livelihood sustainability. However, digital literacy does not significantly moderate the relationships between farmer capability, sustainability orientation, and adaptive farming practices. This study contributes by integrating farmer capability, sustainability orientation, adaptive farming practices, livelihood sustainability, and digital literacy within a unified framework in smallholder agriculture. The findings highlight the central role of adaptive farming practices in translating farmer capability and sustainability orientation into sustainable livelihood outcomes. They further suggest that achieving digital environmental sustainability in smallholder agriculture requires not only digital capability, but also complementary institutional support, extension services, and adaptive capacity development. These insights support efforts to advance SDG 8 and SDG 12.