{
    "success": true,
    "data": {
        "id": 1641006,
        "msgid": "war-becomes-a-money-machine-indonesian-palm-oil-and-coal-businessmen-reap-big-profits-1774749049",
        "date": "2026-03-29 07:30:06",
        "title": "War Becomes a Money Machine: Indonesian Palm Oil and Coal Businessmen Reap Big Profits",
        "author": "",
        "source": "CNBC",
        "tags": "",
        "topic": "Trade",
        "summary": "The outbreak of the Iran-Israel-US war in late February 2026 has driven up prices of crude palm oil (CPO) and coal, benefiting Indonesian exporters who dominate the global market in both commodities. CPO prices have surged 14.6% to MYR 4,631 per tonne, supported by rising crude oil costs boosting biodiesel demand, while coal prices have jumped 23% to US$143.85 per tonne amid shifts back to coal in energy mixes in countries like India and Japan. This windfall underscores Indonesia's strategic position in global energy alternatives, though prices remain below 2022 peaks and depend on ongoing geopolitical tensions.",
        "content": "<p>Jakarta, CNBC Indonesia - Crude palm oil (CPO) and coal prices have\nsurged since the Iran war erupted at the end of February 2026. This\nspike is undoubtedly a major boon for Indonesian businessmen in these\nsectors, as Indonesia is the world\u2019s largest exporter of CPO and thermal\ncoal. According to Refinitiv, CPO prices closed at MYR 4,631 per tonne\non Friday\u2019s trading (27\/3\/2026), exactly one month after the Iran war\nbroke out. Prices rose 1.04% on Friday\u2019s session. Since the war erupted\non 28 February 2026, CPO prices have soared 14.6%. They even touched MYR\n4,631 per tonne on 16 March 2026, the highest since February 2025 or\nover a year. The Iran war against Israel and the United States (US) has\npropelled global crude oil prices, prompting producers to seek cheaper\nalternative energy sources. The rise in crude oil prices supports palm\noil through biodiesel demand, while the strength of soybean oil prices\nsimultaneously reduces substitution pressure in the vegetable oil\nmarket. This creates a double boost, from both cost and substitution\nperspectives. From a technical standpoint, some traders believe prices\ncould find support above MYR 4,580 per tonne, with resistance around MYR\n4,700 per tonne. Currently, prices are in the middle of this range, and\nthe next movement will depend on the sustainability of crude oil price\ntrends and buying momentum from major importing countries. The sharp\nrise in CPO prices now may continue or not, heavily depending on oil\nprice movements, at least in the short term. Despite the war-driven\nincrease, current prices are still far below 2022 levels during the\nRussia-Ukraine war, when they exceeded MYR 7,100 per tonne, the all-time\nhigh. Thus, current prices are generally seen as sustainable and likely\nto move in line with oil prices, where Brent crude last traded at\nUS$97.89 per barrel. Brent oil is currently below the psychological\nUS$100 per barrel level, amid US diplomatic efforts raising hopes of\nde-escalating the Middle East conflict and reducing concerns over\nprolonged supply disruptions. \u201cHigh crude oil prices enhance biodiesel\neconomics, thus driving demand for palm oil as an alternative fuel\nfeedstock,\u201d said Tradeview Capital portfolio manager Neoh Jia Man. He\nadded that this also strengthens expectations of increased biodiesel\nblending mandates, especially in Indonesia, which tightens export\navailability and provides additional support for CPO prices. The\nMalaysian Palm Oil Council (MPOC) forecasts that CPO prices will remain\nabove MYR 4,450 (US$1,130) per metric tonne in the short term, driven by\nrising energy prices and Middle East uncertainty. According to the body,\npalm oil prices will be supported by high energy prices and favourable\nspreads between palm oil and gasoil. \u201cHowever, slowing economic growth\nand rising price volatility due to Middle East uncertainty could\ntemporarily delay imports from major markets, potentially capping price\ngains,\u201d quoted from The Star. This CPO price surge is certainly\nbeneficial for Indonesia, especially palm oil businessmen, given that\nIndonesia is not only the world\u2019s largest producer but also the largest\nexporter. Coal prices have also been stung by the oil price rise.\nAccording to Refinitiv, coal prices closed at US$143.85 per tonne on\nFriday\u2019s trading (27\/3\/2026), or one month after the war, up 1.3%. Since\nthe war erupted, coal prices have skyrocketed 23.04%. They even broke\nthrough US$146.5 per tonne on 20 March 2026, the highest since October\n2024 or 1.5 years. Coal prices surged after many countries turned back\nto the black rock as an oil substitute. India has delayed plans to\noperate coal-fired power plants (PLTU) at lower output levels when solar\npower production peaks. This delay is due to uncertainty over\ncompensation schemes for PLTUs that must operate at minimum levels.\nIndia, which still relies on coal for about 60% of its electricity\ngeneration, has seen rapid growth in solar capacity in recent years and\nplans to quadruple it by 2035. As efforts to increase solar\u2019s share in\nthe electricity mix, the government is considering reducing PLTU output\nthrough a coal flexibility scheme. However, PLTUs need compensation if\ntheir utilisation drops from 55% to 40%. To date, the government has not\nfound the right mechanism. Meanwhile, the industry is also concerned\nabout operational safety at low levels, as well as additional\ninvestments needed to convert PLTUs into flexible generation facilities.\nAs a result, India has postponed the \u201cflexible coal\u201d plan for one year,\nas there are no regulations yet on retrofit compensation and maintenance\ncosts if PLTUs are forced to operate at 40% utilisation. Meanwhile,\nJapan is considering ramping up coal-fired power generation amid a\nliquefied natural gas (LNG) supply crisis causing price spikes.\nAccording to a proposal from the economy ministry, the 50% utilisation\ncap for PLTUs may be lifted in the new fiscal year starting April. This\nstep could reduce LNG consumption by up to 500,000 tonnes per year. In\ncomparison, Japan imports about 4 million tonnes of LNG per year from\nthe Middle East. That amount is also equivalent to Japan\u2019s current LNG\nreserves.<\/p>",
        "url": "https:\/\/jawawa.id\/newsitem\/war-becomes-a-money-machine-indonesian-palm-oil-and-coal-businessmen-reap-big-profits-1774749049",
        "image": ""
    },
    "sponsor": "Okusi Associates",
    "sponsor_url": "https:\/\/okusiassociates.com"
}