Menthaoil August contract dropped Rs 34.1 and settled at Rs 1354.9 due to weak spot demand amid increasing arrivals. Trading activities remained moderately low in the mandis as adverse reports of ban on Pan masala pressurized the market sentiments. Mentha production is expected to rise 30-40% this year as acreage is estimated to increase from 1.75 lakh ha to Rs 2.1 lakh ha. Exports of Mentha during April 2011 to January 2012 witnessed a decline of 6% to 12,850 tonnes as compared to 13,550 tonnes in the same period last year.  In Rampur, mentha oil (68 GLC) quoted at Rs 1,480 per kg, in Chandausi Rs 1,510 per kg, in Sambhal at Rs 1,510 a kg, in Barabanki at Rs 1,440 a kg. On 6th August total stock of mentha oil at MCX-monitored warehouses at Chandausi was 1, 39, 133 kg of which 1, 35, 636 kg was physical stock and demat stock was 3,596 kg. At Barabanki, the total stock was 19, 05, 565 kg of which, physical stock accounted for 16, 30, 136 and demat stock was 2, 75, 428 kg. The contract made intraday low of Rs 1354.9 a kg and high of Rs 1389.5 a kg with the volume of 7285 and total open interest for the same contact was at 5755.Now support for the menthol is seen at 1343.4 and below could see a test of 1331.8. Resistance is now likely to be seen at 1378, a move above could see prices testing 1401.

Trading Ideas:

Mentha oil trading range for the day is 1331.8-1401.

Menthaoil spot is at 1495/-.Spot market is down by Rs.17/-.

Menthaoil ended lower due to weak spot demand amid increasing arrivals.

Trading activities remained low as adverse reports of ban on Pan masala pressurized market sentiments

On 6th August total stock of mentha oil at MCX warehouses at Chandausi was 1, 39, 133 kg