Indonesian crude palm oil prices slipped on Tuesday as the rupiah currency extended gains against the US dollar, traders said. Sellers returned to the market on concerns that prices may fall further due to the rupiah's upward trend.
In local auctions in North Sumatra's Medan, crude palm oil was quoted between 3,871 and 3,885 rupiah ($0.427 and $0.428), down from between 3,890 and 3,896 rupiah a kg on Monday.
CPO prices at the state marketing centre's auction fell to 3,856 rupiah a kg, from 3,876 rupiah a kg on Monday. "Trading is quite active today with more sellers coming to the market. Sellers who need money do not have a choice but to sell now because the rupiah has been gaining since last week," said a trader in Medan, the capital of North Sumatra and Indonesia's key port for palm oil exports.
The Indonesian rupiah stood at 9,060 per dollar late on Tuesday versus 9,145 rupiah per dollar on Monday. While CPO prices fell, RBD palm olein in Jakarta held steady from Monday at 4,290 rupiah a kg, as players stuck to the sidelines, awaiting clearer price leads.
A stronger rupiah against the dollar makes the commodity traded in dollars cheaper in local currency terms. Export demand from major buyers such as India and China remained sluggish without any deals noted for immediate shipment.
Sellers offered July shipments at $397.5 a tonne, free on board Begawan and buyers bid $390 a tonne on Tuesday. Offers for August shipment stood at $402.5 a tonne. Buyers bid at $395 a tonne.
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