June 12, 2008	Thursday	Jamadi-us-Sani 07, 1429

JAKARTA, June 11: Indonesian crude palm oil prices were steady on Wednesday as concern about a possible hike in export taxes next month and slow demand weighed on the market, while gains in Malaysian market provided some support.

Crude palm oil in North Sumatra's Medan, home to Belawan port -- the key port for palm oil exports -- was sold at 9,420 rupiah ($1.01) a kg, unchanged from Tuesday.

Players are reluctant to take positions because they worry about higher export tax in July, said a dealer at a plantation company in Medan.

Dealers have said the government may increase the palm oil export tax to 20 per cent in July, from 15 per cent.

Indonesia, the world's top palm oil producer, adjusts the palm oil export tax every month, based on international prices.

The state marketing centre in Jakarta, which sells palm oil from state plantations, did not hold an auction for the local market.

Malaysian crude palm oil futures were mixed on Wednesday as investors were torn between gains in soyabean oil and sluggish overseas demand as well as a build-up in supplies at home.

The benchmark August contract edged up 7 ringgit to 3,537 ringgit ($1,082) a ton by the midday break. The contract closed up 76 ringgit at 3,606 ringgit a ton

Palm oil, used in a wide range products from soaps, margarine to biodiesel, has gained about 18 per cent since the start of the year, lifted by rallying crude oil markets.

In Jakarta, the price of refined, bleached, deodorised (RBD) palm oil, which is used as cooking oil, was offered at 9,700-9,800 rupiah a kg, down from 10,050 rupiah on Tuesday.

In the export market, the state marketing centre sold 7,000 tons of crude palm oil for prompt delivery at $1,120 a ton, free on board Belawan and Dumai.

—Reuters