Menthaoil settled up 0.88% at 827 driven by rising domestic demand against tight supplies from the major producing belts. However, hopes of higher output from the major producing belts, capped some gains in mentha oil prices. In Bareilly total arrivals were at 20 Drums (1-drum-180kg), down by 5 Drums (1-drum-180kg) from previous trading day. In Sambhal total arrivals were at 60 Drums (1-drum=180kg), up by 10 Drums (1-drum=180kg) as compared to previous day. In Barabanki arrivals were at 85 Drums (1-drum-180kg), lower by 5 Drums (1-drum-180kg) as against previous day. As per the market sources, the total sowing acreage of mentha oil is expected to decline by 20-25% in the current year on the account of delayed harvesting mustard and wheat crop in major areas of Uttar Pradesh and Punjab coupled with poor realization rate from mentha oil. Sources added that the total production of mentha oil in the current year is likely to be around 35-36 thousand tonnes against the previous year of 50 thousand tonnes. The prices were also supported by strong export demand in local mandies. Traders mentioned that the total exports of mentha oil for the full year April 1, 2013 to March 31,2014 are likely to surpass the previous record of 20,500 tonne , ie. reported in 2008. Technically market is under fresh buying as market has witnessed gain in open interest by 0.86% to settled at 3745 while prices up 7.2 rupee, now Menthaoil is getting support at 817.5 and below same could see a test of 808 level, And resistance is now likely to be seen at 833, a move above could see prices testing 839.

Trading Ideas:

Menthaoil trading range for the day is 808-839.

Menthaoil spot is at 882/-. Spot market is up by Rs.10/-.

Mentha oil prices ended with gains driven by rising domestic demand against tight supplies from the major producing belts.

However, hopes of higher output from the major producing belts, capped some gains in mentha oil prices.

In Barabanki arrivals were at 85 Drums (1-drum-180kg), lower by 5 Drums (1-drum-180kg) as against previous day.