AEP shares tank as Indonesia centralises export controls

(Sharecast News) - Shares in London-listed palm oil producer Anglo Eastern Plantations (AEP) tanked on Wednesday after Indonesia announced plans to centralise commodities exports through a state-run agency. Indonesian President Prabowo Subianto said crude palm oil, coal and iron-containing alloys would be sold to the agency, which would then negotiate prices with overseas buyers.

He added that "the prices of all commodities must be determined in our own country". Shares in AEP, which operates in Indonesia and Malaysia, fell 20% on the London Stock Exchange.

The new changes will be implemented in phases from June. Prabowo said they would help combat alleged export fraud through under-invoicing, which he claimed had cost the country $900bn between 1991 and 2024.

AEP, which sells all production to local refineries, said the changes were not expected to have a direct impact, "although there may be indirect effects through pricing adjustments arising from any new arrangements".

Reporting by Frank Prenesti for Sharecast.com