Commodity Trading Tips for Menthaoil by Kedia Commodity

Ajay Kumar Kedia 31 July 2013

Menthaoil yesterday settled down -0.48% at 898 as higher production and high stock levels weighed on prices. As per the market data, the fresh arrivals of around 950-1000 drums of new mentha oil is coming in the major mandies of Chandausi with the price range of Rs 950-990 per kg. Besides the new arrivals, the strong production estimates might also encourage some stockiest selling from higher levels. As per latest data, the total mentha oil production is expected to be in the range of 52000-55000 tonnes in the current year, up almost 10-12% from the last year. This is mainly due to the better price realization and favourable crop conditions. Moreover, the total opening stocks of Mentha oil are estimated at 13000-15000 tonnes for the current year. This may encourage stockiest liquidation at high levels. Production this year expected higher at more than 60,000 tons against 50,000 tons last year. Heavy rains over last few days in UP have adversely affected the harvesting and could also lead to crop damage may impact future prices. Besides the new arrivals, the strong production estimates also propelled some stockiest selling from higher levels. The total mentha oil production is expected to be in the range of 52000-55000 tonnes in the current year, up almost 10-12% from the last year. This is mainly due to the better price realization and favourable crop conditions. Technically market is under fresh selling as market has witnessed gain in open interest by 7.74% to settled at 5541 while prices down -4.3 rupee, now Menthaoil is getting support at 892.4 and below same could see a test of 886.8 level, And resistance is now likely to be seen at 906.7, a move above could see prices testing 915.4.