The Impact of Bio-Ethanol Conversion and Global Climate Change on Corn Economic Performanve of Indonesia

Subject Areas : Environmental policy and management

Yudi Ferrianta ¹ , Nuhfil Hanani ² , Budi Setiawan ³ , Wahib Muhaimin ⁴

1 - Department of Agriculture Economic, University of Lambung Mangkurat, Indonesia
2 - Department of Agricultural Economic, University of Brawijaya, Indonesia
3 - Department of Agricultural Economic, University of Brawijaya, Indonesia
4 - Department of Agricultural Economic, University of Brawijaya, Indonesia

Received: 2015-08-29 Accepted : 2015-08-29 Published : 2012-09-01

Keywords: Climate Change, corn, The Energy Crisis,

Abstract :

Many studies conclude that the rise in global food prices due to higher demand from the development of biofuels, climate anomalies, and increased of oil prices. Not only the food commodity index rose more than 60 percent, nonfood commodity price index also rose over 60 percent and crude oil price index has increased even further above 60 percent. The purpose of this study is to analyze the impact of bio-ethanol conversion and global climate change on corn economic performance of Indonesia. The results showed that the food crisis caused by climate anomalies lead the world corn prices rose 50 percent, impact on Indonesia corn imports fell by 11.86 percent. And the other hand, the energy crisis that caused the corn used as feedstock for ethanol that caused U.S. corn exports only 20 percent of their products have an impact on Indonesia on maize imports fell 32.4 percent.

References:

1- Baltagi, B.H. (2008). Econometrics. SpringerPublishing, Germany.

2- Mcdaniel,Ch., reinert, K., & Hughes, K. (2006).Tools of the Trade:Models for Trade Policy analysis.Science, Technology, America, and the Global EconomyWoodrow Wilson International Center for Scholars.Pennsylvania Avenue Washington. DC.

3- Department for Environment Food and RuralAffairs (DEFRA). (2008). The Impact of Biofuelson Commodity Prices. Nobel House. London

4- Ferrianta, Y. (2012). Impact of Trade LiberalizationAsean-China Free Trade Area (ACFTA) on The Performanceof Indonesia Maize Economy. (Dissertation).University of Brawijaya Malang. Indonesia.

5- Flammini, A. (2008). Biofuels and the UnderlyingCauses of High Food Prices. Rome, Global BioenergyPartnership.

6- Greene, W.H. (1993). Econometric Analysis (2nded.), New York: Macmillan.

7- Gujarati, D.N. (2004). Basic Econometrics, 4thed. McGraw-Hill, New York.

8- Indonesia Department of Agriculture (2010).Prospects and Corn Development in Indonesia.Agency for Agricultural Research and Development,Ministry of Agriculture, Jakarta.

9- Pindyck, R.S & Rubinfeld, D.L. (2005). EconomicModel and Economic forecasts. McGraw Hill, Inc.New York.

10- Baumann, R., & Matheson, V.A. (2011). EstimatingEconomic Impact using Expost EconometricAnalysis: Cautionary tales, College of The HolyCross, Department Of Economics Faculty ResearchSeries, Paper No. 11-03.

11- Studenmund, A. H. (1997). Using Econometrics:A Practical Guide (3rd ed.). New York: Addison-Wesley.

12- T. B. Palaskas (1988). An Econometric Analysisof EEC Policy Ex-post and Ex-ante. An Applicationto Dried Vine Fruits in Greece. Journal of OxfordDevelopment Studies. 17(1): 142-154.

13- USDA (2010). Grain: World Markets and Trade.Circular Series, FG 06-10, USA.

14- USDA-ERS (2008). Cost of Production Estimates.Economic Research Service. USDA Publications.Washington. DC.

15- USDA. (2008). Global Agricultural Supply andDemand: Factors Contributing to The Recent Increasein Food Commodity Prices. Economic ResearchService, USDA Publications. Washington, DC.

16- World Bank (2008). Rising Food Prices: PolicyOptions and World Bank Response. Word BankPublications, Washington. D.C.