Indonesia’s trade surplus rose slightly in February 2026 to USD1.27bn. This extended a run of 70 consecutive months of trade surpluses.
The research note pointed to stronger value-added exports and higher imports of capital goods. It also said the trade surplus may narrow in future as geopolitical tensions and supply chain risks affect external trade conditions.
The note referred to downstream processing results in nickel. It said similar approaches are being considered for iron and steel, coal, and refined fuels.
It also mentioned the Balikpapan refinery as an added export revenue source during current Middle East tensions. The note also referenced regional and global trade partnerships, including ASEAN cooperation and reciprocal tariff arrangements.
The article was produced using an artificial intelligence tool and reviewed by an editor.
The trade surplus extended its run to 70 months in February, but the figure of USD 1.27 billion is significantly lower than the multi-billion dollar surpluses we saw through much of 2025. This trend suggests the positive momentum for Indonesia’s external balance is weakening. For traders, this is a signal that a key pillar of economic stability might be starting to falter.
Given the expectation of a narrowing surplus, we should anticipate pressure on the Indonesian Rupiah in the coming weeks. The USD/IDR has remained relatively stable, but a decline in foreign currency inflows could push the pair above the 15,850 resistance level. We believe positioning for a weaker Rupiah through currency options or futures is the most direct way to act on this view.
Global risks are no longer abstract; they are having a measurable impact. We saw container shipping rates from Asia spike over 300% in late 2023 and early 2024 due to geopolitical disruptions, and those supply chain vulnerabilities persist. These external pressures make it harder for Indonesian exports to maintain their strong performance.
The continued rise in capital goods imports is a positive sign for long-term investment, but it also increases the short-term demand for US dollars. This dynamic creates a challenging environment for the currency. In the immediate term, the negative impact of a narrowing trade surplus is likely to outweigh the positive sentiment from long-term investment signals.
Even with successful downstreaming in the nickel sector, we remain exposed to global commodity price fluctuations. We saw how LME nickel prices fell by over 40% in 2023 from their prior highs due to concerns about global demand, a pattern we monitored closely throughout 2025. This historical volatility shows that export values can drop quickly despite domestic processing efforts.
Therefore, a prudent strategy involves buying out-of-the-money call options on the USD/IDR pair to profit from a potential depreciation of the Rupiah with limited risk. Additionally, traders could consider purchasing put options on ETFs tracking the Indonesian stock market. This would provide a hedge against a potential downturn driven by weakening exports and a less stable currency.
