Computer snag may delay JFX trading

Computer snag may delay JFX trading

JAKARTA (JP): A problem in the installation of a computer
system might cause a delay in the operation of the country's
first commodities futures operator, the Jakarta Futures Exchange
(JFX).

JFX director Rico Menayang said here on Tuesday that if the
problem could not be settled soon, inaugural trading could only
be started in September, two months behind the initial schedule.

"It's a tight schedule but we're still optimistic that the
delay will only be about two months," Rico told reporters on the
sidelines of a seminar on futures trading.

JFX, the country's first commodities futures exchange, has
received government approval to trade olein, a derivative
commodity of crude palm oil (CPO) and coffee.

Despite the present undeveloped olein industry, the JFX
decided to trade olein, given the commodity's widespread use in
the domestic market, Rico said.

"The olein market is far larger than that of CPO," he said.

JFX executive J.W. Sudomo added that domestic demand for CPO
was too high to attract futures traders.

According to him, CPO offered little potential to gain spread
revenue from speculative trading. "People here buy CPO not to
sell it again, but to use it for their factories," Sudomo said.

Rico said that the JFX planned to include four additional
commodities, that of rubber, plywood, pepper and cocoa to give
more alternatives to investors.

"We are still waiting for the government's approval to trade
in the additional commodities," he said, adding that he hoped the
approval could be obtained next year.

He said that in the long-term, the JFX also planned to expand
futures trading to foreign exchange as well as mining products,
such as gold.

The JFX, he said, would cooperate with the Commodity and
Monetary Exchange (Commex) of Malaysia in cross trading
activities.

JFX was established in August 1999, with authorized capital of
Rp 40 billion (US$4.7 million), and paid-up capital of Rp 11.6
billion.

Its founders comprise four oil palm plantations, seven palm
oil refineries, eight securities companies and two general
trading companies.

The JFX's listed brokers, among others, are PT Batavia
Futures, PT Artha Berjangka, PT Dana Graha Futures and PT Gading
International Berjangka.

Rico said that the JFX was preparing the brokers by sending
them to study futures trading at the Commex.(bkm)