Associations to sponsor futures trading bourse

Associations to sponsor futures trading bourse

JAKARTA (JP): Two local commodity associations will sponsor the establishment of Indonesia's futures trading bourse, an official said yesterday.

Chairman of the Indonesian Commodity Exchange Agency Arifin Lumban Gaol said yesterday that the two are the Association of Indonesian Coffee Exporters and the Indonesian Edible Oil Association.

"They are currently preparing business plans for the establishment of the bourse," Gaol was quoted by Antara as saying.

He noted that the government welcomes the participation of other related commodity associations in sponsoring the establishment of the bourse as it will be a multicommodity market.

After such a futures market is established, the Indonesian Commodity Exchange Agency will then provide rulings and guarantee a fair trading mechanism.

Gaol said that Minister of Trade and Industry Tunky Ariwibowo instructed him to continue efforts for the establishment of the futures commodity exchange.

He said the existence of such a commodity exchange will benefit producers, exporters and manufacturers. By using and trading futures contracts, they can reduce the risks of commodity price fluctuations.

The commodity exchange currently manages only the physical trading of coffee and natural rubber with deliveries of up to three months. (rid)