Impact of Local Apple Competition to Farm and Food Processing Production Performance at Batu City

Abstract

Free trade and excess of apple demand increased quantity of apple imports in Indonesia, this due an opportunity to overcome the lack of supply for domestic apples compared to consumption. Increasing import, as already known will lead a decreasing local product competition which may resulted either trade creation or diversion. In the long term, increasing import competition will affect the producers of apples due to the decreasing competitiveness of local apple producers. The purpose of this study is to analyze the effect of apple import competition on land usage, amount of production, productivity and amount of investment in local apple processors industry at Batu. The research is a quantitative research, using secondary data from 2003-2015. The model to determine the effect of local competitiveness are referred to Arita (2013). Data has been analyzed bySimple Linear Regression using SPSS program. The results have been concludedthat 1) local apple competition has a significant positive effect on the amount of land usage (Ha) for local apple cultivations, 2)Local apple competition also has a significant positive effect on the number of local apple production (tons), and 3).Local apple competition has significant negative effect investment of local apple processors industry at Batu.