From Crude Palm oil to Chocolate: The Future of Indonesia's Cocoa Plantations by Analysis of International Chocolate Prices on the Increase in Indonesian Chocolate Production Volume

Abstract Indonesia’s cocoa sector has fallen behind other major producers like Côte d’Ivoire and Ghana. The volatility of global chocolate prices is a crucial factor of cocoa production in emerging economies. To resolve this issue, it is essential to analyse global chocolate pricing. This study aims to investigate the influence of perceived international chocolate price trends on cocoa production volume, as well as the mediating effect of cocoa farmers’ investment plans. Primary data were obtained from Indonesian cocoa producers through a questionnaire survey, yielding 333 valid replies. The answers were analysed by structural equation modelling. The study’s findings emphasised the beneficial impact of perceived international chocolate price trends on cocoa output volume, mediated via cocoa farmers’ investment intentions. This study also identified the moderating influence of government agricultural support, a factor overlooked in prior research. The study’s findings indicated that governmental agricultural support can enhance the correlation between perceived international chocolate price trends and cocoa output volume. These results are crucial for Indonesian cocoa production and beneficial for strategically expanding the agricultural export base and enhancing its participation in the global cocoa market.