INDUSTRY.co.id - Nusa Dua - Futures contract is believed to be the next step in order for Indonesia's tin price to be the reference of world tin price. The feature contract is expected to be launched by the end of 2017.

Head of Commodity Futures Trading Supervisory Board (Bappebti) Bahrul Chairi said, as the largest tin exporter, Indonesia should have a strong position in global pricing. Therefore, ideally domestic business actors can independently run the formation of markets and prices of these commodities.

Currently, Indonesia has only a tin physical market implemented by Indonesia Commodity and Derivatives Exchange (ICDX) since 30 August 2013. At the age of entering four years, ICDX has the right direction and is calculated by the world tin market players.

"The tin stock entrusted to ICDX has the main vision of making Indonesia the bourse as a place of price formation and world tin price reference, but there are some things that still need to be improved," said Bahrul in the 2018 Indonesia Tin Conferences & Exhibition (ITCE) event at Nusa Dua, Bali, Monday (8/28/2017).

According to Bachrul, the world's tin commodity market has been determined by trading on the London Metal Exchange. However, the ICDX began to show its capability as a national commodity pricing commander who is also taken into account global business actors.

It is shown from ICDX tin price data which is not much different from the price in LME. Unfortunately, based on data from Bappebti, the number of ICDX tin business players only reached 72 companies, consisting of 36 sellers and 36 buyers.

He hopes the ICDX can complement the multilateral tin market by trading futures or the Alternative Trading System (SPA). It is important for market participants to hedge the physical commodities due to the risk of price fluctuations

"In the futures market, smelter or producer can insure the price, so if the physical price goes down, the rising futures price will cover the losses." Later system will be like LME, "he said.