Performance of cocoa beans production modelling in Indonesia

Cocoa beans production Indonesia has decline in recent years but demand for cocoa beans relatively increase. This research aims to analyse the modelling of cocoa beans production in Indonesia. This research used secondary data from 2005-2018, with simultaneous equation models. The results of this research indicate that the production of cocoa beans has a positive relationship with land area, international price of cocoa beans and lag of cocoa beans production, while the price of domestic cocoa beans has a negative relationship with cocoa beans production. Domestic demand for cocoa beans has a positive relationship with domestic price of cocoa beans and the cocoa processing industry. Domestic price of cocoa beans has a positive relationship with domestic demand for cocoa beans, international price of cocoa beans and lag domestic price of cocoa beans, while cocoa beans production has a negative relationship with domestic cocoa bean prices.

Meat price volatility as implications for food security in Indonesia

Indonesian meat consumption has 40 percent deficit which was covered by importing. Meat price in international market tend to fluctuate. The gap between domestic demand and supply meat also the imported price fluctuation causes instability of domestic price. This research is conducted to analyze the volatility of meat price which implicated to food security in Indonesia. ARCH-GARCH model is used to estimate meat price volatility in Indonesia. The Augmented Dickey-Fuller and cointegration test have been used for testing the presence of unit root and cointegration in the series. Langrange multiplier has been utilized to detect the presence of autoregressive conditional effect. Daily meat prices used are national average price which obtained from the Indonesia Ministry of Trade. This study reveals that meat price in Indonesia has high volatility with increasing price over the research period. The empirical model also shows asymetry effect. The results recommend that Indonesia should apply comprehensive managed import such as not only import on fresh meat and ready to cut bovine but also on breeding bovine. By the fulfilling production and stock, meat price can be more stable. By the price stabilization, food security concept will be reached so that every layer society can consume meat.

Does the Incomplete Exchange Rate Pass-through Exist in Sudan?

The purpose of this paper is to examine the nominal exchange rate pass-through to domestic prices in Sudan from 1978–2017. An autoregressive distributed lag (ARDL) approach to cointegration is employed. The analysis is based on impulse response functions (IRFs) and forecast error variance decompositions (FEVDs). The dynamics of the cointegrated system can be investigated via the variance decompositions and IRFs. The findings confirm that the degree of exchange rate pass-through in Sudan is incomplete, and the empirical results also show that the domestic price index is predominantly caused by foreign price in both the short and long runs, in addition to the import price index and the nominal exchange rate; the exchange rate shock has a negative effect on the domestic price. Furthermore, FEVDs analysis illustrates that the variation in domestic price is primarily determined by the import prices, while changes in the exchange rate are primarily determined by the exchange rate itself.

Demand for Cashew Nut Exports of Guinea-Bissau (1990-2011): VAR Model Application

This study aimed to estimate via VAR the reaction of the export demand for Guinea-Bissau Cashew nuts to the shocks of world income, exchange rate and of the foreign and domestic prices and of the effects of the Civil War, which occurred in the country from 1990 to 2011. The main results obtained by analyzing the impulse response function and variance decomposition, showed that changes in domestic price and exchange rates don’t explain the external demand for this commodity. External demand responds to changes in global income and foreign price. Moreover, the Civil War of 1998 influenced the foreign demand. In the long run, external demand for cashew nuts doesn’t react to shocks in any of the variables in the model.

THE EFFECT OF PRICE BEHAVIOUR ON INDONESIAN CPO EXPORT QUANTITY

Unpredictable changes in supply and demand may cause the variation of price behavior. Crude Palm Oil (CPO) as Indonesian main export commodity has the highest risk of uncertainty price which is influenced by world price while it tends to fluctuate and become volatile in the given period. In order to increase CPO production, government has implemented biodiesel mandatory regulation namely B30 in 2019. It means that the use of diesel fuel with 20 percent of biofuel content. Besides that, government also applies zero tax policy to stimulate CPO producers in doing export. The objectives of this research are to analyze price volatility and its effect on export volume in the long term. Daily Indonesian CPO price since January 2010 to December 2017 was analyzed by Historical Volatility Method and Cointegration Test. This research shows that both domestic and world price of CPO tends to be high while domestic price is less volatile than world price. Furthermore, CPO’s price and export volume are cointegrated and have negative relation in the long term.

An exploration of the association between fuel subsidies and fuel riots

Fuel riots are common around the world. Between 2005 and 2018, 41 countries had at least one riot directly associated with popular demand for fuel. We make use of a new international dataset on fuel riots to explore the effects of fuel prices and price regimes on fuel riots. In line with prior expectations, we find that large domestic fuel price shocks are a key driver of riots - as these are often linked to international price shocks. In addition, we report a novel result: fuel riots are closely associated with domestic price regimes. Countries that maintain fixed price regimes - notably net energy exporters - tend to have large fuel subsidies. When such subsidies become unsustainable, domestic price adjustments are large, often leading to riots.

PRICE INTERDEPENDENCE OF AGRICULTURAL COMMODITIES FROM UKRAINE AND WORLD MARKETS

The objective of the paper is to present the price interdependencies between agricultural commodity products from Ukraine (both export and non-export oriented) and other commodities whose prices are shaped on world markets, with a special focus on the role of their volatility. The research demonstrates a tight connection between the global prices of crude oil and prices of Ukrainian corn and wheat. Additionally, the volatility of world prices of agricultural commodities influenced the Ukrainian national market and had significant impact on domestic price declines. At the same time, the mechanisms for pricing non-export related agricultural commodities are formed mostly under the influence of factors from the domestic market. It is argued that a low interdependency between non-export oriented agricultural commodities and world markets stipulates the social stability of Ukraine’s population.

On the Drivers of Inflation in Different Monetary Regimes

This document proposes a general macroeconomic framework to analyze the behavior of inflation. This approach has two characteristics. The first is the distinction of monetary regimes based on the number of shocks that have a permanent effect on the price level. When all shocks have a permanent impact, the regime determines the inflation rate, as in inflation targeting. On the other hand, when there is only one shock with permanent effects, the regime determines the price level. An example of this is a regime with a fixed exchange rate. Even if there is no explicit target for the domestic price level, this becomes determined by the operation of a regime of this type. The second characteristic comes from the factors that Granger cause the rate of inflation or the price level. With this, a new perspective on four different historical cases emerges. One is the German hyperinflation; the second is that of the United States for a very long sample. For Brazil and Mexico, the analysis demonstrates that their inflationary processes' complexity arises from the regime changes they have gone through.