Commodity Trading Tips for Mentha Oil by KediaCommodity

Ajay Kumar Kedia 12 August 2014

Menthaoil settled down -0.53% at 693.1 due to sluggish demand from consuming industries in the spot market. Further, increased arrivals of the commodity in the physical market from the major producing belts in Uttar Pradesh too supported the downside in mentha oil prices. No strong report emerged for Mentha Oil as lack of demand kept trend sideways for the commodity. Demand is to pick up in the coming days that could support the prices which have fallen a lot over last few months. At Rampur total arrivals are at 10 Drums(1-drum=180kg), down by 12 Drums(1-drum=180kg) from previous day's arrivals. At Bareilly market sources reported arrivals at 10 Drums(1-drum-180kg), lower by 5 Drums(1-drum-180kg) from previous day's arrivals. At Barabanki market sources reported arrivals at 300 Drums(1-drum-180kg), unchanged as compared to previous day's arrival. At Sambhal market arrivals were reported at 50 Drums(1-drum=180kg), unchanged as compared to previous day's arrival. At Chandausi market estimated market supply was at 2 Drums(1-drum-180kg), down by 13 Drums(1-drum-180kg) from previous day's arrivals. 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. Technically market is under long liquidation as market has witnessed drop in open interest by -0.92% to settled at 9175 while prices down -3.7 rupee, now Menthaoil is getting support at 689.4 and below same could see a test of 685.7 level, And resistance is now likely to be seen at 699.4, a move above could see prices testing 705.7.