Feasibility of futures trading to be discussed

JAKARTA (JP): The Indonesian Commodity Exchange Agency (Bapebti) will organize a series of seminars and workshops to discuss futures trading in a number of major cities in the country before introducing futures transactions.

Bapebti's chairman, Arifin Lumban Gaol, told a three-day trade workshop at the Ministry of Trade on Saturday that the planned seminars and workshops are to garner input from private sector executives and analysts about the feasibility of introducing futures trading at the commodity exchange.

The commodity exchange currently manages only the physical trading of coffee and natural rubber with future deliveries within a period of up to three months, besides organizing the sales of textiles with export quotas.

Gaol stated that the decision to set up futures trading on the commodity exchange will be left with the private sector agencies involved to encourage them to be more responsible for its sustainable operation. Bapebti will only provide rulings and guarantee a fair trading mechanism.

"It is important to note that a futures market will be established only if there is a guarantee that it will be liquid," he said.

"The government is very concerned about its liquidity because several futures commodity exchanges in the world have become inactive due to changes in technology," Gaol said.

Bremen's tobacco bourse in Germany and the rubber bourses in the United States, Europe and Kuala Lumpur, for example, have long been inactive. (rid)