Factors influencing the soybean import volume in North Sumatera Province

Abstract

Imports become an alternative policy to meet the domestic soybean demand. North Sumatra Province has a high dependence on soybean imports because the amount of soybean imported is greater than the amount of domestic production. The purpose of this study was to analyse the influencing factors of the soybean import volume in North Sumatera Province. The Engle-Granger Cointegration Test and the Error Correction Model (ECM) methods used to identify the factors influencing the soybean import volume in the long-term and the short-term. The results concluded that the soybean import was significantly influenced by the domestic soybean production, the exchange rate, and the soybean price ratio. In the long-term, the soybean price ratio significantly influences the soybean import volume. While in the short-term, exchange rate and soybean price ratio significantly influence the soybean import volume.