Indonesia’s planned commodity exchange likely to cover palm oil, nickel, coal
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Indonesia is the world’s largest exporter of palm oil, thermal coal and nickel products.
PHOTO: ST FILE
JAKARTA – Indonesia’s planned exchange for “mineral and strategic commodities” will likely include palm oil, nickel and coal, a presidential spokesperson said as the government prepares to launch the bourse on Jan 1.
President Prabowo Subianto announced the plan during his 2027 budget proposal speech on Aug 14, saying that Indonesia’s aim was to create its own reference price for many of its key commodities.
The exchange is the latest attempt by Prabowo to leverage the country’s vast reserves of natural resources to boost economic growth, after announcing policies in May to centralise commodity exports.
South-east Asia’s biggest economy is the world’s largest exporter of palm oil, thermal coal and nickel products and a major supplier of coffee beans, bauxite, tin and copper, among others.
The Indonesian government is ironing out the details on how to implement the plan, including the types of commodities that will be traded on the exchange, presidential spokesperson Prasetyo Hadi told reporters on Aug 17 on the sidelines of Indonesia’s Independence Day celebrations.
“Certainly, it will cover the commodities that are our primary products, such as CPO (crude palm oil), nickel, and coal,” he said.
The Financial Services Authority (OJK) will introduce rules for the bourse by Sept 17, its chief Friderica Widyasari Dewi told reporters.
The OJK rules will include the phased transition of trades into the new exchange, she said on Aug 14, while a separate presidential decree will be issued to list which commodities will trade on the bourse.
The plans were welcomed by the Indonesian Nickel Miners Association, which has been lobbying for a national mineral exchange.
The announcement was an acknowledgement by the government that Indonesia should no longer be a price-taker for commodities it supplied in the largest volumes to global markets, association chairperson Nanan Soekarna said in a statement on Aug 18.
The association said the exchange could provide an alternative reference for buyers and sellers seeking more transparent prices that reflect actual output levels at major production hubs.
“However, we emphasise that the success of this exchange will be determined by the strength of data integrity, the clarity of governance, and the involvement of national miners from day one, not by how quickly features are launched,” said Meidy Katrin Lengkey, the association’s secretary-general.
Indonesia has existing commodity exchanges for palm oil, tin and some other commodities. Tin exports are required to go through the local exchange, but trade at the existing palm oil bourse has so far been limited. REUTERS
