MediumI Geo-Economics & Chokepoints1 September 2026, Tuesday
Indonesia hands coal, palm oil and ferroalloy exports to a state company and sets up a domestic exchange for nickel pricing
Under the planned timetable, Danantara's DSI takes over contracts, shipments and payments directly from 1 September. OJK is expected to publish the rules of the BMKS commodity exchange on 17 September. The exchange will become fully operational on 1 January 2027.
According to Indonesia Business Post, PT Danantara Sumberdaya Indonesia (DSI), established on 20 May 2026, will manage the entire export process for crude palm oil, coal and ferroalloys from 1 September, following a transition period from 1 June to 31 August. These commodities account for about 60% of the country's exports. According to Asia Times and Shanghai Metals Market, the Mineral and Strategic Commodity Exchange (BMKS) backed by Prabowo will become fully operational on 1 January 2027. The Financial Services Authority OJK is expected to publish the exchange's core rules on 17 September. Products such as nickel pig iron, ferronickel and MHP will fall within the exchange's scope.
Indonesia supplies more than half of global nickel and wants the price to be set domestically rather than on the LME. The aim is to reduce discounts, invoice manipulation and capital flight. According to SMM data, the official nickel reference price (HPM) fell to 16,698 dollars a tonne in September. Analyst Wahyu Laksono expects that if the export monopoly causes disruption, global coal prices could rise by 5–10%, or by 15–25% in a severe scenario. The steps are creating contractual uncertainty in supply chains, above all for China, the largest buyer.
Talay assessment
Bottom line
By concentrating the export process for commodities that make up about 60% of its exports in a state company and seeking to set the nickel price domestically instead of on the LME, Indonesia is institutionalising resource nationalism. The main near-term risk is contract and shipment disruptions tightening coal supply; the nickel exchange becoming a global price reference is an uncertain goal that depends on execution and lies beyond 1 January 2027.
Likely effects
- Coal marketNegativeWeeks
If the transition falters, an analyst projects global coal prices could rise by 5–10%, or 15–25% in a severe scenario; costs for coal-importing power producers, including in Türkiye, would rise through this channel.
- China supply chainNegative1–6 months
Steel and battery producers in China, the largest buyer, face supply uncertainty as pricing and contract terms are renegotiated with the state company.
- Nickel price discoveryUncertain6 months+
If the domestic exchange of Indonesia, which supplies more than half of global output, succeeds, the LME's benchmark role weakens; producer countries gain pricing power, while transparency depends on implementation.
Possibilities, ranked
- 1Frictional but functioning transition55%
DSI carries out shipments with delays and OJK publishes the rules; as buyers adapt, coal prices see limited and temporary upward pressure.
Watch: OJK publishing the BMKS rules on schedule on 17 September and Indonesian coal export volumes holding in September–October
- 2Postponement or softening30%
Under pressure from buyers and producers, the government partly slows the transition, grants exemptions or delays the exchange timetable; market impact stays limited.
Watch: Exemptions from DSI's remit or an announced delay to BMKS's 1 January 2027 start date
- 3Severe disruption15%
Blockages in contract and payment processes cut exports markedly; coal prices climb towards the analyst's 15–25% range and China seeks alternative supply.
Watch: A sharp fall in Indonesian coal shipments, buyers' force majeure notices and China switching import sources
Probabilities are calibrated judgement based on the sources, not measurement, and are revised as new information arrives. Not investment advice.