Export Scheme Through State-Owned Enterprises Risks Cutting Margins; Downstream-Focused Issuers Safer
Indonesia’s government plans to require exports of strategic commodities to go through state-owned enterprises (BUMN), a move seen as potentially squeezing margins for private exporters and altering the pattern of Indonesia’s commodity trade. Amid these changes, issuers focused on downstream processing and the domestic market are expected to be better positioned than companies reliant on exporting raw materials.
The policy follows a two-phase reform of export governance for several strategic commodities, from crude palm oil (CPO) and coal to ferro-alloys. The policy was announced by President Prabowo Subianto after issuing a Government Regulation (PP) on the Tata Kelola Ekspor Komoditas Sumber Daya Alam (SDA) – the governance framework for the export of natural-resource commodities.
The initial phase will apply to three main commodities: palm oil, coal, and ferro-alloys. In Phase One, running from June to August 2026, private exporters are required to redirect export–import contracts with foreign buyers through PT Danantara Sumberdaya Indonesia. At this stage, customs processing will be handled by the state-owned enterprise, while pre- and post-customs activities will still be partly run by the exporting companies.
Then from September 2026, the BUMN will become the sole party to all foreign-buyers’ transactions.
He said the government does intend to improve export governance to be more orderly. However, the Indonesian commodity market has long been dominated by the private sector, so changes to the trading mechanism could disrupt existing supply chains.
‘There is a new rule that export commodities must go through a BUMN or Danantara. This is interesting because the government wants exports to be neater and more orderly. But this market is mainly private, so it could backfire,’ said Ibrahim on Thursday (21 May 2026).
‘Many of Indonesia’s private mining operations rely on foreign funding. Where foreign funding is involved, there is usually cooperation between the funding party and the mine operator in Indonesia. Therefore the goods must be bought or sold by the financier.’
In addition to purchase contracts, mining companies also bear debt obligations to banks that have thus far been supported by export activity.
Ibrahim argues the government wants to reduce the role of brokers in commodity trading. But he notes that such practice is common in almost every country.
‘We must remember that brokers exist not only in Indonesia but also in Singapore, Malaysia, and elsewhere. Export cooperation has long been built by the private sector, and now it is being sidelined by the government through Danantara and the BUMN,’ he said.
‘Does the policy have the potential to trim private margins due to added trading intermediaries? Yes, certainly,’ he added.
He also warned that global commodity trade is typically based on long-term contracts. Prices in a contract do not automatically move with the latest international market prices.
‘For example, a coal contract might be agreed at $150. Even if three months later prices jump to $300 or $400, that does not apply because the contract is already in place. Prices usually only apply for hedging.’
He urged the government to ensure price mechanisms remain transparent and conform to a win-win principle so private companies are not harmed if export prices are determined via the BUMN.