Determinants of Indonesia's Wheat Imports

Abstract

Indonesia's wheat imports have consistently increased each year, driven by the growing population and demand for various wheat derivative products. Consequently, Indonesia has become the world's largest wheat importer in 2021. This study aims to determine the determinant factors of Indonesia’s wheat imports during the 1990-2021 period. The data used in this study is time series data of 32 years from 1990 to 2021, which consists of annual data on the Indonesian wheat import volume, GNI, wheat consumption, rice consumption, exchange rate value, interest rate, domestic rice production, wheat price, rice price and wheat flour import tariff agreement. The data was processed using Eviews 9 with multiple linear regression models using the Ordinary Least Square (OLS) method. The regression results showed that GNI, wheat consumption, rice consumption and the exchange rate had positive impacts on the Indonesian wheat import volume during 1990-2021, while domestic rice production had negative impacts. On the other hand, interest rate, wheat price, rice price and wheat flour import tariff agreement have no significant effect on Indonesian wheat import volume.