Main Article Content
The objectives of this research are i) to examine New Zealand's 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.
Download data is not yet available.
How to Cite
Nurunisa, V. F., Sinaga, B. M., Winandi, R., & Brummer, B. (2014). PRICE TRANSMISSION OF SKIM MILK POWDER IN INDONESIA: DO SKIM MILK POWDER IMPORT PRICES FOLLOW THE PRICES IN NEW ZEALAND?. Forum Agribisnis : Agribusiness Forum, 4(2), 171-192. https://doi.org/10.29244/fagb.4.2.171-192
The authors who publish an article(s) in Forum Agribisnis understand and agree that the copyright of article published is owned by Forum Agribisnis including to reproduce, distribute and sell this journal to public.Every people is allowed to cite any part of the article in Forum Agribisnis with writing the author(s) name and Forum Agribisnis in references.