OPEC crdue oil production in Q1 is estimated by Barclays at 29.7 million barrels per day and so far it has averaged 29.8 mb/d. Although it is slightly higher by 100,000 b/d more than estimated it will not lead to significant inventory build up.
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The native Place of Mentha is Japan. So Mentha is also known as Japanese Mint. After Japan, its cultivation began in Argentina, Brazil and China. Then it started in India.
Now India is the leader in its production as well as in its export. Other producer countries are also showing their presence with production of the by-product. It is used in medicines related to seasonal diseases like cough and cold, stomach pain and also used in tooth-pastes, soaps and detergent powder. Moreover, it is also used in toffee, Paan, Guttka, perfumes etc. China is the biggest importer of mentha oil and they market it after processing it further.
The main importers are China, Argentina, Brazil, US, France, Japan, UK etc. China mostly buys only mentha oil but other countries import it in the shape of powder and crystals also. Export from India has crossed the level of around 10,000 ton per annum and that is likely to increase in coming years. Producing states in India.
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The main mentha producer states are UP and Bihar. Himachal Pradesh, Jammu and Punjab also contribute in production but in low quantity.
In 2007, production of mentha oil was nearly 32,000 ton and carry over stock was 3,000-4,000 tons which took the overall availability to nearly 35,000-36,000 ton for that specific year. Total consumption of domestic as well as international market usually remains nearly 25,000 ton/year. At the time of sowing, traders were assuming that production may touch the record level of 40,000 ton during 2008 but excessive rains during June-July in producing areas washed away all the hopes and brought down the production estimate to 20,000 tons. There were reports of crop damage from the rains during that time. Last year’s carry forward stock is nearly 7,000-8,000 tons. This means total availability would be nearly 27,000-28,000 ton this year, while total consumption is expected to remain around 25,000 ton which includes domestic as well as overseas demand. So, carry forward stock is likely to remain around 2,000-3,000 ton.
The sowing area in UP which is the main mentha producer state, is increasing year by year. Moreover, owing to it being a cash crop, farmers give preference for its cultivation. First cultivation was start in Sambhal in 1969 in the state. The cultivation was started in Punjab and Jammu before UP. In UP, it is also cultivated in Chandausi, Barabanki, Rampur, Badaun, Jallon and Coche areas which are the main producing areas.
First cultivation of mentha was started in Begusarai of Bihar. Owing to it being a cash crop, farmers preferred it and started cultivating it in more and more places. At present, it is cultivated in Bhagalpur, Lakhi Sarai, Khagariya, Samastipur, Darbhanga and Patna. Total production of these places is around 2,000-3,000 ton. Though farmers are taking interest for its cultivation, but due to lack of mandi yard, the total produce (oil) is sold in Baranbanki. And its production is usually calculated with UP production. In Bihar, there are problems with the climate as excess rains and floods generally cause damage to the crop.
Other Producing Areas
Other producing areas are Jammu, Punjab and Himachal Pradesh. As there are many mentha oil related industries, some sowing takes place in border areas of Jammu.
During 2008, total availability is expected to remain nearly 27,000-28,000 ton which includes estimated production of nearly 20,000 ton and carry over stock of around 7,000-8,000 ton. With estimated total consumption of ~25000 tons which includes overseas and domestic demand, carry forward stock is likely to remain nearly 2,000-3,000 ton. It is to be noted that during previous years, carry forward stock always remained high. But in the wake of low carry forward stock this year and lower production estimates, farmers can be expected to hold onto their stocks and release them slowly.
There are apprehensions of export demand mainly from China and European countries picking up in the near future. This can provide support to the prices. Strengthening of Dollar vs Re can also provide further support to the prices.