Paper ID: 74

THE IMPLICATIONS OF THE COVID-19 PANDEMIC ON RICE MARKET PERFORMANCE IN JAVA INDONESIA

Authorship

Muh Amat Nasir1, Jamhari1, and Jangkung Handoyo Mulyo1

1 Department of Agricultural Socioeconomics, Universitas Gadjah Mada, Indonesia

muh.amat.n@mail.ugm.ac.id

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Abstract

Applying the multivariate cointegration tests with daily prices (daily – 5 day week) during the period July 25, 2016, to July 02, 2020, period (980 data), this paper examines whether prices in the rice deficit market (Yogyakarta) are co-integrated with prices in surplus markets (Semarang and Surabaya). Research data is the average daily price in a group of traditional markets in Yogyakarta, Semarang, and Surabaya. Traditional markets are determined as a research sample based on the results of a 2018 market survey conducted by the Central Statistics Agency. The proportion of the existence of the largest trade center in Indonesia is the traditional market, which reaches around 88.52 percent. The main focus is on the effect of the implementation of various programs and policies relating to controlling the spread of COVID-19 to the integration of the rice market in the eastern part of Java Island. On March 02, 2020, the first two COVID-19 cases that occurred in Indonesia were confirmed. The cointegration tests find that the domestic rice prices of Yogyakarta and Semarang are integrated both in short-run and long-run periods. In the short term, programs and policies relating to controlling the spread of COVID-19 have affected integration in the Yogyakarta and Semarang markets, but not in the Surabaya market. The reason is that the distance between Yogyakarta and Semarang is relatively closer compared to Surabaya. Long distances between markets resulting in low volumes of trade between the Yogyakarta-Surabaya and Yogyakarta-Semarang markets.

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