Jakarta – The Commodity Futures Trading Supervisory Agency (BAPPT) is one of the Echelon I units in the Ministry of Commerce. Guidance, regulation, supervision and development of Commodity Futures Trading (PPK), Warehouse Receipt System (SRG) and Commodity Auction Market (PLK) are the main functions and main functions of CoFTRA.
The legal basis for the implementation of these duties and functions is Law no. 7/2014 Commerce, Act no. 32/1997 Act no. 10/2011 Commodity Futures Trading, Act no. 9/2006 Act no. 9/2011 Warehouse Receipt System and Presidential Decree No. 75/2022 relating to the structure, guidance and development of commodity auction markets.
This was explained by Khasan, Executive Chairman of the Commodity Futures Trading Supervisory Agency (BAPPT).
Commodity futures trading (PPK) is margin withdrawal and buying and selling of commodities based on futures contracts, Shariah derivative contracts and/or other derivative contracts, Kasan explained.
Commodities, meanwhile, are all goods, services, rights and other interests, and any derivative of goods subject to a futures contract. Various commodities in Indonesia can be the subject of futures contracts, one of which is CPO. CPO is Indonesia’s strategic commodity, with total production expected to reach 45.5 million metric tons and total exports of 26.2 million metric tons or USD 29,656 million in 2022.
Until now, Indonesia’s CPO production and exports are still high compared to other countries in the world. Indonesia contributes more than 50% of the world’s CPO needs. In the period from January to September 2023, Indonesia’s CPO exports were 19.56 million metric tons or USD 17,302 million, with India, China and Pakistan as the three largest export destination countries.
Besides, CPO is important to grow because: CPO contributes a lot in generating foreign exchange and employment, CPO is used as a source of energy for electricity and fuel oil (BPM), CPO is a raw material for edible oil industry. , margarine, shortening and, in addition, CPO supports the growth of the palm oil industry producing more than 100 downstream products.
Although CPO plays an important role in Indonesia, until now prices in CPO transactions refer only to Rotterdam and Bursa Malaysia. Therefore, Bappebti plays a role in efforts to improve Indonesian CPO trade management by establishing a CPO reference price. This is also Act no. 10 of 2011 related to Commodity Futures Trading, which mandates the government to make reference prices of commodities transparent through futures exchanges.
In this initiative the policy of the Government (Popepati) CoFTRA Regulation no. 7/2023 Relating to Procedures for Execution of CPO Trades on Futures Exchange. As a follow-up, the government established the Indonesian CPO Exchange in October 2023, which was opened by the Minister of Trade.
The Indonesian CPO Exchange currently regulates CPO physical and futures market trading on the futures exchange established by the Indonesian government. In the physical market mechanism, voluntary CPO trade for the local market is regulated with distribution points at Tumai and Pelawan ports.
Benefits we can get from having an Indonesian CPO Futures Exchange: Accurate, transparent and real-time CPO reference prices are generated, Indonesia will have a single source of data related to CPO transactions, Palm Oil Mills (PKS) is on the same level as major CPO trading actors, as sellers and buyers are on a level playing field. , improvements in fresh fruit bunch (FFB) prices by the Ministry of Agriculture and Forestry will prompt the Ministry of Energy and Mineral Resources to set more precise. Biodiesel reference prices, improving state revenue from taxes and Indonesia becoming a market influencer in the global market.
Although this CPO exchange policy is voluntary, with the commitment of CPO business actors, we are confident that many CPO business players will transact on the exchange. For this reason, Popepti undertakes various initiatives to strengthen literacy in the society through training, seminars and dissemination of information through mass and social media. Bappebti will also cooperate with Bursa Malaysia and other exchanges in the world such as Chicago, London and Singapore.
„Certainly there are many things that will be our challenges in the future, and there are many things like how to trust the CPO exchange, how to improve the CPO futures trade and facilitate the export, and how to improve the CPO trade through the exchange. Delivery in major ports „other than Dumai and Belawan,” Kasan said.
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