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Mentha Oil market under short covering; Support seen at 1198
Commodity Online | September 13 2017
UPDATED 11:53:25 IST

MCX Aluminium likely to move in a range of 134.2-142.6

MCX Mentha Oil under long liquidation

Support seen at 888.4 for MCX Nickel

MCX Zinc may trade 225.2-233 levels

Support seen at 454.8 for MCX Copper

Technically Mentha oil market is under short covering as market has witnessed drop in open interest by 0.28% to settled at 3262 while prices up 1.2 rupees.

Now MCX Mentha oil is getting support at 1198 and below same could see a test of 1192.1 levels and resistance is now likely to be seen at 1211.8, a move above could see prices testing 1219.7.

Mentha oil on MCX settled up by 0.1% at 1203.9 amid short covering tracking firmness in spot demand after prices dropped due to tracking higher supply. Prices of mentha oil were down on higher supplies from oil producing regions while the demand is sluggish.

Traders are ready to offload stocks available in their warehouses but the demand from mentha oil consuming industries is low against the sufficient stock which is keeping prices under pressure.

Stock positions of mentha in MCX accredited warehouses were around 11163 drums which is 136 drums less in comparison to previous day while in process were 396 drums, which is same against the previous day.

Total global production stood at around 48,000 tonnes, out of which India produces between 30,000-40,000 tonnes. According to estimates, mentha oil production in India for crop year 2016-17 will be around 38,000 tonnes. As per the report “Essential Oil- Global Industry Perspective, Comprehensive Analysis and Forecast, 2014-2020” the global demand of essential oil will increase in the coming years.

Global essential oil market is mainly driven by increasing demand from natural and organic care products. This will boost mentha oil demand, mainly from medicines, health products, cosmetics as well as food and beverages.

From export front, the demand for mentha oil will emerge from the European Union, the UK, Japan, the UK, China and Singapore. Mentha oil spot at Sambhal closed at 1369.70 per 1kg. Spot prices were up by Rs.14.50/-.

Trading Ideas:
--Mentha oil trading range for the day is 1192.1-1219.7.
--Mentha oil spot at Sambhal closed at 1369.70 per 1kg. Spot prices were up by Rs.14.50/-.
--Mentha oil gains amid short covering tracking firmness in spot demand after prices dropped due to tracking higher supply.
--Stock positions of mentha in MCX accredited warehouses were around 11163 drums which is 136 drums less in comparison to previous day.
--Total global production stood at around 48,000 tonnes, out of which India produces between 30,000-40,000 tonnes.

Courtesy: Kedia Commodities

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