Commodity Trading Tips for Mentha Oil by KediaCommodity

Ajay Kumar Kedia 2 September 2014

Mentha-Oil Menthaoil settled down -1.77% at 684.4 tracking a weak trend at spot market on sluggish demand from consuming industries. Further, ample stocks positions in the physical market on increased arrivals from the major producing belts in Uttar Pradesh too added pressure on mentha oil prices. At Rampur market estimated market supply was at 15 Drums(1-drum=180kg), steady as against previous day’s arrival. At Bareilly market arrivals were reported at 6 Drums(1-drum-180kg), down by 9 Drums(1-drum-180kg) from previous day’s arrivals. At Barabanki market sources reported arrivals at 285 Drums(1-drum-180kg), steady as against previous day’s arrival. At Sambhal market total arrivals are at 50 Drums(1-drum=180kg), unchanged as compared to previous day’s arrival. At Chandausi total arrivals are at 10 Drums(1-drum-180kg), lower by 5 Drums(1-drum-180kg) as compared to previous day. In the current season, the production of mentha oil is estimated at about 50,000 to 60,000 tons, whereas last year this figure was 38,000 to 42,000 tons. Thus up to 40 per cent of stock is estimated to be still lying in the godowns. Mentha is an aromatic herb used for medicinal oil extraction. Mentha oil is used widely in cosmetic and food industry as "mint" for flavour. India's production of mentha oil may touch 60000 tons this year. Area under crop may touch 2.10 lakh ha vs 1.75 lakh ha last year. Technically market is under fresh selling as market has witnessed gain in open interest by 0.58% to settled at 9311 while prices down -12.3 rupee, now Menthaoil is getting support at 682 and below same could see a test of 679.6 level, And resistance is now likely to be seen at 688.4, a move above could see prices testing 692.4.