Indonesian Coffee Competitiveness in the International Market: Armington Model Application

The purpose of this research is to analyze the competitiveness of Indonesian coffee in the international market by using secondary data years 1990-2011. The analytical tool used is Armington models, which consists of a demand equation, the equation of supply and price equations. Armington model analysis results, review from the demand side are a Brazilian coffee competitors in Japan and Germany, while the Columbian coffee are competitors in Japan and the Netherlands. While the other coffee exporting countries are partners and potential partners. Review from supply side: Indonesian coffee offer in Japan and Australia are affected by supply last year, while in the Netherlands, United States and Germany are influenced by Indonesian coffee prices (producer prices). Review from price side: Consumer prices in the five Indonesian coffee importing countries (Japan, Netherlands, United States of America, Germany and Australia) is influenced by producer prices, the exchange rate against the United States dollar and technology, while consumer prices last year had no significant effect except in the German states.