JFX At a Glance
A number of studies conducted by foreign consultants for the Indonesian government confirmed that a futures exchange can bring large benefits for the business community, especially for hedging purpose. Having noticed this fact, the government proposed a bill (Rancangan Undang-Undang) to the People’s Representative Council (DPR) in 1996 and on 5 December 1997 Law Number 32 Year 1997 Regarding Commodity Futures was approved by the People’s Representative Council.
PT. Bursa Berjangka Jakarta is the first futures exchange established by this Law. It was founded on 19 August 1999 by 4 palm oil plantations, 7 palm oil distillations, 8 coffee exporters, 8 brokerage firms and 2 trading companies. The paid in capital which was approved was only 11,4 billion Rupiah out of total capital of 40 billion Rupiah. Bursa Berjangka Jakarta has fulfilled all requirements in Law number 32 year 1997 mentioned above and received the license from the Supervisory Board Commodity Futures Exchange in the second semester of 2000.
Although futures exchange mergers have become a trend, which happened in a number of countries, the establishment of another futures exchange is feasible in Indonesia, as long as it is approved by the government.
Bursa Berjangka Jakarta will become a futures exchange for numerous commodities. Olein which was launched on the first day of the futures exchange is now accompanied by other commodities, such as gold, along with gold index. Other commodities are continuously planned to be launched, including option on futures contract and financial futures.
PT Bursa Berjangka Jakarta, also known as Jakarta Futures Exchange (JFX) was officially established on 19 August 1999 in Jakarta by 29 trading companies in accordance with Government Regulation number 9 year 99. The trading companies consist of 4 palm oil plantations, 7 palm oil distillations, 8 coffee exporters, 8 brokerage firms and 2 trading companies. JFX received its operating certification on 21 November 2000 and started its first trading on 15 December 2000.
The establishment of JFX was based on the idea that a futures exchange in Indonesia can bring large benefits for the business community, especially for hedging purpose. That idea generated a bill which was submitted to the People’s Representative Council (DPR) in 1996 and was later approved as Law number 32 year 1997 regarding Commodity Futures on 5 December 1997. PT Bursa Berjangka Jakarta is the first futures exchange established by this Law.
Along with the development of the futures exchange industry, Law number 32 year 1997 was later revised to Law number 10 year 2011 regarding Commodity Futures, giving bigger opportunities for futures exchange to expand.
The main purpose of JFX is to provide facilities for its members to perform futures contract transaction based on the price which was determined through efficient interaction between demand and supply in the electronic trading system. In its early operation, JFX traded olein futures contract and robusta coffee futures contract, and later JFX expanded its scope to gold futures contract and crude palm oil futures contract in 2001. However, crude palm oil futures contract and robusta coffee futures contract were discontinued in 2002 due to lack of interest.
In June 2009 JFX launched an organized physical market where traders are able to perform transaction, transparently, effectively and efficiently. In the future JFX will continue to expand its scopes to coffee, coal, tin and rubber.
In early 2011 JFX was rebranded by introducing its new logo which was more dynamic and reflected the modernity of its business process and technology used nowadays. To complete its new logo, the name Jakarta Futures Exchange or JFX has become its new identity, giving a more modern and dynamic impression to accommodate the development of Jakarta futures exchange at international level. Another important development, JFX moved to their new building with elegant and visionary architecture which enhances its company image as an international futures exchange.
With enthusiasm and determination to build a reliable futures exchange facility, JFX continually enhances its capacity and capability. There is hope for this institution to gain international recognition after its success of becoming the world cocoa price reference in 2012.