Menthaoil yesterday settled up 2.34% at 898 tracking a firm trend at spot market on strong retailers and export demand. Sentiments were further bolstered on tight supplies in the spot markets due to less arrival from growing belts. Production this year expected higher at more than 60,000 tons against 50,000 tons last year. Higher stock levels could pressurize prices in medium term. Heavy rains over last few days in UP have adversely affected the harvesting and could also lead to crop damage may impact future prices. Weak trend in the mentha oil prices is still exist as demand failed to pick up at lower levels. Higher production estimates, good stocks may limit the commodity prices in the short term to certain extent. The total area under mentha crop is expected to increase this year as the commodity prices witnessed firm trend in the last year due to good demand from pharmaceutical industry. Besides the new arrivals, the strong production estimates also propelled some stockiest selling from higher levels. The total mentha oil production is expected to be in the range of 52000-55000 tonnes in the current year, up almost 10-12% from the last year. This is mainly due to the better price realization and favourable crop conditions. Technically market is under short covering as market has witnessed drop in open interest by -24.42% to settled at 2745 while prices up 20.5 rupee, now Menthaoil is getting support at 874.9 and below same could see a test of 851.8 level, And resistance is now likely to be seen at 913.4, a move above could see prices testing 928.8.

Trading Ideas:

Menthaoil trading range for the day is 853.1-930.1.

Menthaoil spot is at 965/-. Spot market is up by Rs. 5/-.

Mentha oil ended with gains tracking a firm trend at spot market on strong retailers and export demand.

Sentiments were further bolstered on tight supplies in the spot markets due to less arrival from growing belts.

Production this year expected higher at more than 60,000 tons against 50,000 tons last year.