Early this year, president Joko ‘Jokowi’ Widodo announced his plan to take the biodiesel 20% (B20) to B100 as an effort to reduce import of petroleum diesel and boosting price of crude palm oil (CPO), which was under pressure from negative campaigns, especially in the European Union. In theory, 100% biodiesel is possible, but Jokowi’s own trusted man Luhut Binsar Pandjaitan said recently that the program can only be taken to B50.

The European Commission has on November 22 sent a letter to the World Trade Organization (WTO) challenging Indonesia’s nickel ore export ban, which comes into effect January 2020, arguing it goes against WTO rules. Japan, used to be major importer of nickel from Indonesia, had in 2012 threatened to take the same issue to WTO ahead of the first export ban in 2014, but never did submit the complaint. So, why now?

Falling average price of crude palm oil (CPO) led to 18.7% decline of export revenues from the commodity in the first 10 months of 2019. As the second largest export commodity behind thermal coal, it hurts the country’s overall export. Hopes are high, however, that revenues will recover next year because contract prices of CPO for first half next year have increased significantly in the past few weeks.

Oil prices rose on Wednesday (Nov. 20) as American crude stockpiles rose less than expected, and inventories at a key storage hub shrank by the most since August. Russia said it would keep cooperating with the Organization of the Petroleum Exporting Countries to limit global supplies. Brent crude futures rose $1.49 to settle at $62.40 a barrel, while U.S. benchmark WTI crude futures settled up $1.90 at $57.11 a barrel. West Texas Intermediate crude increased 3.4% to $57.11 a barrel. 

INALUM, which acquired 51% shares of PT Freeport Indonesia late last year, suffered Rp388 billion of losses in the first nine months of 2019 against net profit of Rp5.58 trillion in the corresponding period last year, among others due to substantial increase in finance costs related to acquisition of the copper and gold mining company.

State electricity provider PT Perusahaan Listrik Negara (PLN) booked net profit of Rp10.85 trillion in the first nine months of 2019 against loss of Rp18.5 trillion in the corresponding period last year, thanks to appreciation of rupiah and introduction of the so-called ‘compensation income’ from the government.

Coal miner Golden Energy Mines (GEMS), member of Sinarmas Group, reported a 53% decline in profit, to US$46.48 million in the first nine months to September (9M) of 2019, from US$98.2 million in the corresponding period of 2018, due to lower sales, higher cost of sales and higher selling expenses.

Coal producer Trada Alam Minera (TRAM) declined further by 1.72% to Rp57 last Friday (Nov 15) to maket a market capitalization of Rp2.83 trillion. This morning, the stock declined further by 3.51% to Rp55. The stock crashed by more than 50% in the past three weeks due to poor financials and persistent low price of thermal coal in international market. Bear in mind that TRAM was a company with market capitalization of Rp20.15 trillion in April 2018.

The benchmark January 2020 contracts of crude palm oil (CPO) advanced RM22 to RM2,606 per ton on the Bursa Malaysia Derivatives Monday (Nov 11), while February and March contracts were traded at RM2,635 and RM2,642 per ton respectively. Reduction of fertilizer application by planters, prolonged dry weather, and biological tree stress are seen supporting factors.

Indonesian economy might get a boost from recovery of palm oil industry. The benchmark January 2020 contracts of crude palm oil (CPO) on the Bursa Malaysia Derivatives jumped RM81 to RM2498 per ton (US$598) Wednesday (Oct 31). Contracts for February-June 2020, meanwhile, were all settled above US$600 per ton. Further rallies?