Jakarta. Indonesia’s Commodity Futures Trading Regulatory Agency (Bappebti) is preparing to establish a benchmark price for nickel, a move aimed at strengthening the nation’s position as a global nickel powerhouse.

Tirta Karma Senjaya, Head of Bappebti, said Indonesia, as the world's largest nickel producer and reserve holder, must capitalize on this strategic commodity to boost state revenue.

"Currently, nickel prices are still based on overseas markets. Indonesia needs its own price reference to maximize its economic potential. The futures commodity trading system will play a crucial role in achieving this," Tirta said on Friday.

The initiative aligns with the government's broader goals of advancing downstream industrialization, strengthening the domestic market, expanding export opportunities, and promoting new business players in the sector.

Nickel, according to Tirta, has significant potential to become a key futures contract on the Indonesian Futures Exchange. The goal is to establish a price reference for both national and global markets, in line with Law No. 10 of 2011, which amended Law No. 32 of 1997 on Commodity Futures Trading.

"Initially, nickel was primarily used for stainless steel production. However, with technological advancements, its applications have expanded significantly, particularly in electric vehicle battery production. Given its high price volatility, nickel is well-suited for futures trading," Tirta added.

According to the United States Geological Survey, Indonesia produced 1.8 million tons of nickel in 2023, accounting for half of the world’s total production of 3.6 million tons, making it the largest global producer.

Major nickel-producing regions in Indonesia include Central Sulawesi, South Sulawesi, Southeast Sulawesi, and North Maluku.

Data from the Trade Ministry shows that Indonesia is also the world’s top nickel exporter, with key destinations including China, Japan, Norway, the Netherlands, and South Korea.

“With this initiative, Indonesia can strengthen its position in the global nickel market while ensuring greater economic benefits domestically,” Tirta concluded.