Indonesia, the world’s largest producer of tin and palm oil and the third-biggest coffee grower, is seeking the help of futures-exchange owner CME Group Inc. to expand domestic trading of commodities, according to Deputy Trade Minister Bayu Krisnamurthi.
“Everybody is saying that Asia is the agent of growth in the world, so evolvement of an Indonesian commodity market is inevitable,” Krisnamurthi said yesterday during an interview in Chicago, where the CME is based. “CME is over 100 years old, and the Indonesian commodity market is 10 to 12 years old. We would like to grow it, develop it.”
The Indonesia Commodity & Derivatives Exchange in Jakarta trades palm oil and gold, and added a dollar-traded tin contract in February 2012. The country needs an expanded market as the economy grows and production increases, Krisnamurthi said. Gross domestic product will expand at a better than 6 percent annual rate over the next three years, according to analysts surveyed by Bloomberg.
Indonesia boosted palm-oil production almost eightfold in the past two decades, and expects to expand output to 35 million metric tons by 2020, Krisnamurthi said. The U.S. Department of Agriculture forecast 31 million in the 2013-2014 season.
Krisnamurthi and members of the Indonesian Commodity Futures Trading Regulatory Agency met yesterday with CME Group Chief Executive Officer Phupinder Gill, according to Aryana Utomo, a marketing officer with the Indonesian Trade Promotion Center in Chicago. Details of the meeting weren’t available, Utomo said.
Chris Grams, a spokesman for the CME, declined to comment.