Commodity Trading Tips for Mentha Oil by KediaCommodity

Ajay Kumar Kedia 13 August 2014

Menthaoil settled up 1.83% at 705.8 driven by firming trend at spot markets on strong industrial demand. Further, tight inventories in the physical market due to lower arrivals from the major producing belts too supported mentha oil price's uptrend. Demand is to pick up in the coming days that could support the prices which have fallen a lot over last few months. But with prices having fallen a lot over last few months, it could find some support at these lower levels. At Rampur market arrivals were reported at 20 Drums(1-drum=180kg), up by 10 Drums(1-drum=180kg) as against previous day. At Bareilly market sources reported arrivals at 5 Drums(1-drum-180kg), down by 5 Drums(1- drum-180kg) from previous trading day. At Chandausi market sources reported arrivals at 65 Drums(1-drum-180kg), higher by 63 Drums(1-drum-180kg) from previous day's arrivals. At Barabanki market total arrivals are 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. 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 short covering as market has witnessed drop in open interest by -3.41% to settled at 8862 while prices up 12.7 rupee, now Menthaoil is getting support at 696.7 and below same could see a test of 687.6 level, And resistance is now likely to be seen at 711.4, a move above could see prices testing 717.