Agricultural Product Derivatives - Indonesia

Indonesia

The nominal value in the Agricultural Product Derivatives market is projected to reach US$54.58bn in 2024.
It is expected to show an annual growth rate (CAGR 2024-2029) of 0.31% resulting in a projected total amount of US$55.44bn by 2029.
The average price per contract in the Agricultural Product Derivatives market amounts to US$0.08 in 2024.
From a global comparison perspective it is shown that the highest nominal value is reached in the United States (US$12,320.00bn in 2024).
In the Agricultural Product Derivatives market, the number of contracts is expected to amount to 712.50k by 2029.

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Analyst Opinion

Amidst the lush landscapes of Indonesia, the Agricultural Product Derivatives market is experiencing notable growth and evolution.

Customer preferences: Customers in Indonesia are increasingly turning to Agricultural Product Derivatives as a means of diversifying their investment portfolios and hedging against price volatility in the agricultural sector. The convenience and flexibility offered by these financial instruments are appealing to investors looking to capitalize on the fluctuations in commodity prices without directly trading physical goods.

Trends in the market: One of the key trends in the Agricultural Product Derivatives market in Indonesia is the growing interest in palm oil derivatives. Indonesia is one of the largest producers of palm oil globally, and as such, there is a significant demand for derivatives linked to the price of this commodity. Investors are closely monitoring factors such as weather conditions, government policies, and global demand to make informed decisions in this market.

Local special circumstances: Indonesia's unique position as a major player in the global agricultural market significantly influences the Agricultural Product Derivatives sector in the country. The government's policies related to agriculture, land use, and exports have a direct impact on the performance of derivative products linked to key commodities such as palm oil, rubber, and coffee. Additionally, the country's geographical location and climate conditions play a crucial role in shaping market trends and investor sentiment.

Underlying macroeconomic factors: The overall economic stability of Indonesia, coupled with its growing population and increasing urbanization, is driving demand for agricultural products and their derivatives. As the country continues to modernize its agricultural practices and improve productivity, investors are optimistic about the potential returns offered by Agricultural Product Derivatives. Furthermore, Indonesia's strategic position in the global supply chain for key commodities ensures that the market remains dynamic and responsive to both domestic and international developments.

Methodology

Data coverage:

Figures are based on commodity derivatives, their notional value, the number of contracts traded, the open interest (outstanding contracts at the end of a year), and the average value of a contract.

Modeling approach / Market size:

Market sizes are determined by a Bottom-Up approach, based on a specific rationale for each market segment. As a basis for evaluating markets, we use market research & analysis, and data of World Bank, as well as the World Federation of Exchanges. Furthermore, we use relevant key market indicators and data from country-specific associations and national data bureaus such as GDP, wealth per capita, and the online banking penetration rate. This data helps us to estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the particular market. In this market, we use the HOLT-damped Trend method to forecast future development. The main drivers are GDP per capita an the online banking penetration rate.

Additional Notes:

The market is updated twice per year in case market dynamics change.