Geopolitical Impact on The Availability and Price of Wheat for Importers in Indonesia

Abstract

This study aims to analyze the impact of geopolitical conflicts on wheat availability and prices for importers in Indonesia, focusing on supply chain activities through the Cigading and Ciwandan Port areas in Cilegon, Banten. This research employed a qualitative approach with a descriptive design. Data were collected through in-depth interviews, observations, and documentation involving 12 informants selected using purposive sampling, representing actors involved in various stages of wheat procurement, trade, transportation, and distribution. Data analysis was conducted through data reduction, data presentation, conclusion drawing, and thematic categorization related to geopolitical conflicts, wheat availability, shipping routes, logistics costs, prices or landed costs, adaptation strategies, and coordination among supply chain actors. The findings indicate that the Russia–Ukraine conflict and geopolitical tensions in the Middle East do not directly cause the disappearance of wheat from the Indonesian market but increase uncertainty regarding supply continuity and delivery timeliness. Increased risks along trade routes encourage changes or diversions in shipping routes, resulting in longer lead times and greater uncertainty regarding arrival schedules. These conditions subsequently increase freight costs, fuel consumption, insurance costs, and war risk premiums, contributing to higher landed costs and wheat procurement expenses. Identified adaptation strategies include supplier diversification, increased safety stock or buffer stock, alternative shipping routes, adjustments to procurement and production schedules, digital technology utilization, and enhanced coordination and information exchange among supply chain actors. The study concludes that geopolitical impacts on wheat are transmitted through international transportation and logistics mechanisms, making supply chain resilience essential for maintaining supply continuity and controlling procurement costs. The findings emphasize the importance of balancing cost efficiency, flexibility, security, and supply reliability.