Indonesian palm oil prices eased on Tuesday in line with weakening Malaysian crude palm oil futures as buyers retreated to the sidelines to see if the fall would continue. The state marketing centre in Jakarta, which sells palm oil from state plantations, failed to sell 2,500 tonnes of crude palm oil due to low bids.
But in North Sumatra's Medan, the leading port for palm oil export, high-grade super crude palm sold at a local auction at 6,585 rupiah ($0.723) a kg, with 400 tonnes changing hands. On Tuesday, regular crude palm oil sold at 6,590 rupiah.
"Prices are down because Malaysia crude palm oil is down. There's no other factor," said a trader in Medan. "But most buyers are in wait-and-see mode. Refiners don't want to buy crude palm oil at higher prices now but then are unable to sell olein as prices drop the next day," he added.
Malaysian crude palm oil futures fell on Wednesday on lower prices of rival soybean oil and expectations of higher stocks. Malaysia losses also pushed down cooking oil prices. In Jakarta, non-branded cooking oil which is widely consumed by low-to-middle income groups was quoted at about 7,100 rupiah a kg, down from 7,220 rupiah on Tuesday.
"When prices fall, buyers are on the sidelines, waiting for prices to fall further," said a cooking oil trader in Jakarta. On the export market, a few deals were done for October-December shipment at $680 a tonne, free on board Belawan. But there was no information on quantity and buyers.
For prompt shipment in July, sellers offered crude palm oil at $720 a tonne, free on board Belawan. Buyers bid at $712.5 without any deals reported. August shipments were offered at $710 and bid at $700. No deals were reported.