Analysis of Factors Affecting Soybean Import Volume in Indonesia

Indonesia relies heavily on imported soybeans to meet its domestic needs due to limited soybean production capacity. The objective of this study is to examine the factors affecting soybean import volume in Indonesia. Secondary data being used from 1991-2020 collected from FAO, World Bank, USDA, and IMF. This study focuses on soybean import volume as the dependent variable, by considering factors such as domestic soybean price, soybean world prices, the exchange rate, per capita income, domestic soybean production, soybean consumption, and import tariffs. The data was examined by Error Correction Model (ECM). The results of this study indicates that in the long-term relationship, domestic soybean prices, world soybean prices, the exchange rate, and domestic soybean production are significantly affecting soybean import volume in Indonesia. In the short-term relationship, soybean import volume is significantly affected by exchange rate. The government needs to maintain soybean price stability, strengthen the exchange rate, and implement the soybean production and productivity improvement program in Indonesia.