Technically Mentha Oil market is under long liquidation as market has witnessed drop in open interest by 2.35% to settled at 1244 while prices down 7.7 rupees.
Now MCX Mentha Oil is getting support at 1251.7 and below same could see a test of 1245.4 level, and resistance is now likely to be seen at 1269, a move above could see prices testing 1280.
Mentha Oil on MCX settled down 0.61% at 1258.1 as there has been an increase in the arrival of mentha. Pressure also seen after the Bihar state government has completely banned all types of pan masala. Currently, this ban has been imposed for 12 months.
Arrival pressure also seen in the market as farmers are now bring their crop in market after Govt had given relief to the farm sector, the government has decided not to levy 2 per cent tax deduction at source (TDS) on cash payments of over Rs 1 crore made through Agriculture Produce Market Committees (APMCs).
There were estimations of a 20-25% rise in sowing in 2019 versus last year.It is likely to touch ~3 lakh ha—as per Central Institute of Medicinal and Aromatic Plants (CIMAP). It should be noted that this year’s production expectation of 38500- 39000 MT stood slightly above the average production of 36,968 MT productions seen in between 2013 and 2018.
Therefore expectations of a significant jump in production over last year due to is ruled out. Due to improving exports prospects, estimates for ending stocks has been reduced even lower than previous year. There were estimations of a 20-25% rise in sowing in 2019 versus last year.The output has not risen in past few years with India producing ~80% of global production and exporting ~75% of its output.
--Mentha Oil trading range for the day is 1245.6-1280.2.
--Mentha Oil spot at Sambhal closed at 1408.10 per 1kg. Spot prices was up by Rs.5.60/-.
--Mentha Oil settled down as there has been an increase in the arrival of mentha.
--Pressure also seen after the Bihar state government has completely banned all types of pan masala.
--There were estimations of a 20-25% rise in sowing in 2019 versus last year.
Courtesy: Kedia Commodities