Menthaoil settled down -0.13% at 768 due to lower demand from consuming industries in the spot market. Besides, ample inventories in the physical market following increased arrivals from Chandousi in Uttar Pradesh too added pressure on prices. However downside seen limited due to anticipation of weak sowing progress in local mandies along with strong export demand in local mandies. As per the market sources, the total sowing acreage of mentha oil is expected to decline by 20-25% in the current year on the account of delayed harvesting mustard and wheat crop in major areas of Uttar Pradesh and Punjab coupled with poor realization rate from mentha oil. Sources added that the total production of mentha oil in the current year is likely to be around 35-36 thousand tonnes against the previous year of 50 thousand tonnes. The prices will also be well supported by strong export demand in local mandies. Traders mentioned that the total exports of mentha oil for the full year April 1, 2013 to March 31,2014 are likely to surpass the previous record of 20,500 tonne , ie. reported in 2008. Traders are expecting that the total exports is likely to reach in the range of 21000 to 21500 tonnes as most of exporters are showing strong buying participation at current levels with the anticipation of limited supplies in next marketing season. Technically market is under long liquidation as market has witnessed drop in open interest by -0.44% to settled at 4101 while prices down -1 rupee, now Menthaoil is getting support at 763.6 and below same could see a test of 759.3 level, And resistance is now likely to be seen at 773.9, a move above could see prices testing 779.9.

Trading Ideas:

Menthaoil trading range for the day is 759.3-779.9.

Menthaoil spot is at 825/-. Spot market is down by Rs. 1/-.

Mentha oil settled flat due to lower demand from consuming industries in the spot market.

Ample inventories in the physical market following increased arrivals from Chandousi in Uttar Pradesh too added pressure.

However downside seen limited due to anticipation of weak sowing progress in local mandies.