CoFTRA Targets CPO Exchange To Be A World Palm Price Reference Starting In The First Quarter Of 2024

Head of the Supervisory Agency of the Commodity Futures Trading Supervisory Agency (CoFTRA), Didid Noordiatmoko. (Photo: Doc. ANTARA)

JAKARTA - The Commodity Futures Trading Supervisory Agency (CoFTRA) targets that by the first quarter of 2024 Indonesia will have its own crude palm oil (CPO) reference price.

Indonesia's own CPO Exchange has started trading today.

As is known, Indonesia is the largest producer of palm oil with a capacity of around 50 million tons per year.

However, Indonesia still uses reference prices from Malaysia and Rotterdam.

Head of the Supervisory Agency of the Commodity Futures Trading Supervisory Agency (CoFTRA), Didid Noordiatmoko, said the government was indeed targeting the price reference or reference price of CPO to be formed in the first quarter of 2024.

"We are targeting the first quarter of 2024 that we can get price reference. That means if, it is credible, it means that the volume is sufficient and the price does not go up very drastically, so we can believe that the buyer of the sale is money to money," he said at the ICDX Office, Jakarta, Friday, October 20.

Furthermore, Didid said, the reference price was also intended to be able to make the CPO price fairer (fairer).

He said, the trade with the CPO exchange would be more organized.

This is not a matter of having to be high, or having to go up. But fair. Where the beginning of the session opened at a price of Rp. 12,485 per kg and the acquisition was Rp. 11,305 per kg and that was fair," he said.

Even so, Didid said, his party would not force any party to use it as a reference price. However, the CPO reference price can later be used by the Ministry of Trade in forming the Export Patokan Price (HPE).

In addition, the price will also be used by local governments (Pemda) and the Ministry of Agriculture to form a fresh fruit bunch (FFB) price for palm oil.

"We just issue a reference price. Later each agency will be free to use. We do not force it, but this is a fair price. Because of the fair trade results. Because this will affect his accountability," he explained.

Didid said the government would also prepare incentives for business actors who want to trade through the CPO exchange.

"This (incentive) again we godog, hopefully in the near future it will be announced so that in the first quarter of 2024 it can be a price reference because more and more people will join the stock exchange," said Didid.

If the Indonesian CPO exchange has become a reference for world palm oil prices, then domestic business actors no longer refer to price differences on Malaysian and Rotterdam exchanges.

"We also assured the Ministry of Agriculture that this is a credible price and can be a reference in policy making both downstream CPO and FFB prices (signs of fresh fruit) upstream," he concluded.