Indonesian palm oil prices were mixed on Monday, reflecting local demand combined with government intervention to curb rising cooking oil prices and losses in Malaysia. In Jakarta, the state marketing centre which sells palm oil from state plantations, crude palm oil traded at 6,656 rupiah ($0.738) a kilogram, slightly up from 6,649 rupiah on Friday with 1,500 tonnes changing hands.
"Prices are lifted by local refiners' demand. They need crude palm oil, so they have to buy," said Aziz Kara, the head of palm oil sales at the centre. There was no auction in North Sumatra's Medan, the leading port for palm oil exports.
There was no auction on Friday either. "We saw Malaysia's crude palm oil was down today, so we prefer to wait," said a trader in Medan. Malaysian crude palm oil futures fell in thin trade, pressured by declining prices of rival soyaoil and faltering export demand.
In Jakarta, non-branded cooking oil prices were quoted at 7,250 rupiah a kilogram, down 100 rupiah on Friday. Although cooking oil prices have been declining, they have not yet met the governments targeted of 6,500-6,800 rupiah a kilogram.
The government has raised the crude palm oil export tax to 6.5 percent from 1.5 percent and that on products to 6.5 percent from 0.3 percent, in order to control cooking oil prices which were up nearly 30 percent this year due to surging global prices.
"Prices of cooking oil are softening since the government imposed the new tax," said an olein trader in Jakarta. On the export market, sellers offered July shipment at $735 free on board Begawan, down 0.67 percent from $740 a tonne on Friday. Buyers bid at $727.5 but no deals were reported. October to December shipments, sellers offered at $697.5 and buyers bid at $690 without any deals reported.
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