Analysis of factors affecting organic rice exports in Indonesia

Abstract

The market opportunities from organic farming which are getting bigger globally are being utilized by farmers in various regions in Indonesia and have succeeded in cultivating organic rice and have quite wide market coverage even abroad. This research aims to determine the factors that influence the volume of organic rice exports in Indonesia. The results of multiple linear regression prove that the domestic price of organic rice, the international price of organic rice and the dollar exchange rate against the rupiah influence the volume of organic rice exports in Indonesia. The price of organic rice, both domestic and international, has a negative effect on organic rice exports. Meanwhile, the dollar exchange rate against the rupiah has a positive effect on organic rice exports. The policy implications based on the research results are (a) Seeing the research results showing that the price of domestic organic rice has a negative and significant effect on organic rice exports, the government must maintain prices (inflation), especially the price of domestic organic rice. (b) When the rupiah depreciates, organic rice exports will increase, but exchange rate stability must be maintained by the government. So the increase in organic rice exports is the result of increased rice production, not just the exchange rate.