Commodity Trading Tips for Menthaoil by KediaCommodity

Ajay Kumar Kedia 27 November 2013

Menthaoil settled down -0.65% at 878 due to strong carryover stocks in major mandies along with sluggish demand by user industries. As per market sources, the total stock position of around 33-34 thousand tonnes of mentha oil has been reported in the major mandies. This can easily meet the average annual domestic demand of 32-33 thousand tonnes. Therefore, comfortable stocks encouraged the strong stockiest selling from higher levels. The market sources also suggested that all the major pharmaceutical and food confectionery industries are already sitting with comfortable stocks in their warehouses. As per market sources, most of the cultivators and traders have reported strong liquidation in the major mandies to meet their cash requirement during the festivals season. The total stock position of mentha oil is currently reported at around 45-50 thousand tonnes against the average annual domestic demand of 32-33 thousand tonnes. Market sources suggested that the total production of mentha oil is estimated around 54-55 thousand tonnes in the current year against 45 thousand tonnes of the last year. This is mainly due to the better price realization and favourable crop conditions. Moreover, the total opening stocks of the current year were also estimated higher at 12 thousand tonnes against 8 thousand tonnes that were reported last year. Technically market is under fresh selling as market has witnessed gain in open interest by 26.76% to settled at 4652 while prices down -5.7 rupee, now Menthaoil is getting support at 872.3 and below same could see a test of
866.6 level, And resistance is now likely to be seen at 886.5, a move above could see prices testing 895.