DOI: 10.36347/sjebm.2019.v06i02.003

Pages: 96-103

Cocoa planted areas in Indonesia are the fourth largest just ranking behind oil palm, coconut, and rubber while cocoa contributes the third highest foreign exchange, next to palm oil and rubber. The objectives of this study are to investigating the structure of cocoa industry and to analyzing the influences on economic performance and export of cocoa beans in Indonesia. A simultaneous equation model with 6 equations is developed to investigate the economic performance of cocoa industry in Indonesia and two-stage least-squares method is adopted to estimate the simultaneous model. Data used to analyze is mainly time series data from 2000 to 2015 obtained from the Central Bureau of Statistics (BPS), Ministry of Agriculture, PUSDATIN, FAO, and UN. As the results, all coefficient signs are significantly as expected. The urea fertilizer price and temperature has a negative and significant effect on cocoa productivity. The cocoa domestic price and cocoa world price significantly has a positive influences on the harvest area of cocoa. The cocoa production is the product of cocoa productivity and harvest area. The cocoa world price has a positive and significant effect on cocoa export, but domestic price significantly has a negative effect on cocoa export. The previous-year cocoa domestic price has a positive and significant effect on the domestic price of cocoa. The income has a significant and positive effect on the cocoa consumption while the domestic price has a significant and negative influence on the cocoa consumption. Finally, the impacts of 5%, 10%, 15%, and 20% of urea fertilizer subsidies are simulated. Leading the increase in cocoa productivity (63.36%), harvest area of cocoa (39.45%), cocoa production (136.19%), cocoa export (62.34%), and domestic price of cocoa (23.70%) and decrease on cocoa consumption (-7.36%), 5% of urea fertilizer subsidy policy is chosen as the best.