Commodity Trading Tips for Mentha Oil by KediaCommodity

Ajay Kumar Kedia 14 August 2014

Menthaoil settled down -0.62% at 701.4 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. At Rampur total arrivals are at 20 Drums(1-drum=180kg), unchanged as compared to previous day's arrival. At Barabanki market arrivals were reported at 300 Drums(1-drum-180kg), unchanged as compared to previous day's arrival. At Sambhal market total arrivals are at 50 Drums(1-drum=180kg), steady as against previous day's arrival. At Bareilly market estimated market supply was at 10 Drums(1-drum-180kg), up by 5 Drums(1-drum-180kg) as compared to previous day. At Chandausi market sources reported arrivals at 15 Drums(1-drum-180kg), lower by 50 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. 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. Technically market is under long liquidation as market has witnessed drop in open interest by -2.09% to settled at 8677 while prices down -4.4 rupee, now Menthaoil is getting support at 697.2 and below same could see a test of 693.1 level, And resistance is now likely to be seen at 707.2, a move above could see prices testing 713.1.