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Bernhard Brummer
Department of Agricultural Economics and Rural Development, Georg August University of Goettingen, Germany

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PRICE TRANSMISSION OF SKIM MILK POWDER IN INDONESIA: DO SKIM MILK POWDER IMPORT PRICES FOLLOW THE PRICES IN NEW ZEALAND? Nurunisa, Venty Fitriany; Sinaga, Bonar Marulitua; Winandi, Ratna; Brummer, Bernhard
Forum Agribisnis Vol 4, No 2 (2014): FA Vol 4 No 2 September 2014
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The objectives of this research are i) to examine New Zealands dairy sector and ii) to analyze the market integration and price transmission of Skim Milk Powder (SMP) of New Zealand and Indonesian market. The methods used are Augmented Dickey Fuller test, Johansen Cointegration test, and Vector Error Correction Model. The result indicates: 1) as trade partner, New Zealand is powerful due to its status as the largest dairy producer worldwide; therefore, Indonesia has less bargaining power and 2) The SMP market of both countries are integrated. The coefficient of long run equation variable indicates that every 10 percent changes of one market, the imported SMP price will adjust 10.97 percent, while the exported SMP price will adjust 9.12 percent. The loading vector coefficient indicates that Indonesia is the only party adjusting to long run disequilibrium. Policies to minimize the risks includes: i) buffer budget, ii) alternative suppliers and iii) futures trade.
THE IMPACT OF REGIONAL TRADE AGREEMENTS TO THE COMMODITY TRADE FLOWS (CASE STUDY: INTERNATIONAL PALM OIL TRADE) Pujiati, Riska; Firdaus, Muhammad; Adhi, Andriyono Kilat; Brummer, Bernhard
Forum Agribisnis Vol 4, No 2 (2014): FA Vol 4 No 2 September 2014
Publisher : Forum Agribisnis

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Indonesia and Malaysia are the major exporters of palm oil in South East Asia. South East Asia Regional Trade Agreement can affect worldwide trade flow of palm oil. The objective of this study is to examine the effect of the Regional Trade Agreement on the trade flows of Indonesian and Malaysian palm oil. The effect is analyzed with gravity model.  The result shows positive dynamic effect of Free Trade Agreement to palm oil trade flow. Regional Trade Agreement has higher impact to Malaysia than Indonesia due to dissimilar government policies.