Commodity Trading Tips for Mentha Oil by KediaCommodity

Ajay Kumar Kedia 30 July 2014

Menthaoil settled down -0.24% at 714.8 amidst sluggish demand from consuming industries in the spot markets. Further, ample inventories in the physical market following increased arrivals from the major producing belts too added pressure on mentha oil prices. Higher stock and lack of strong demand in the mandis did not support the sentiments. Sources expect demand to pick up in the coming days that could support the prices which have fallen a lot over last few months. Markets sources suggested that the total carryover stocks of around 26-28 thousand tonnes have been reported in the major producing states. These were well above the average monthly consumption of around 15-16 thousand months of the next six months. Sources mentioned that mentha oil production in the current year is likely to be around 60 thousand tonnes against the earlier estimates of 52-54 thousand tonnes. As per market sources, most of the cultivators and traders have reported strong liquidation in the major mandies to meet their cash requirement during the festivals season. In Rampur estimated market supply was at 20 Drums(1-drum=180kg), lower by 5 Drums(1-drum=180kg) from previous day’s arrivals. In Bareilly Estimated market supply was at 20 Drums(1-drum-180kg), steady as against previous day’s arrival. In Sambhal arrivals were reported at 60 Drums(1-drum=180kg), down by 40 Drums(1-drum=180kg) as compared to previous day. In Chandausi arrivals were reported at 5 Drums(1-drum-180kg), lower by 5 Drums(1-drum-180kg) as compared to previous day. Technically market is under fresh selling as market has witnessed gain in open interest by 6.14% to settled at 8333 while prices down -1.7 rupee, now Menthaoil is getting support at 711.9 and below same could see a test of 709 level, And resistance is now likely to be seen at 718.1, a move above could see prices testing 721.4.