MCX Mentha Oil likely to trade in a range of 1575.4-1625.8

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Technically MCX Mentha is getting support at 1590.7 and below same could see a of 1575.4 level, And resistance is now likely to be seen at 1615.9, a move above could see prices testing 1625.8.

Mentha Oil on MCX settled down by 1.46% at 1605.9 on profit booking tracking weakness in spot demand after prices gained amid low supply. Export demand of oil and its derivatives in global market is likely to be improved due to recovery in currency which is supportive for prices.

Farmers have started preparing to harvest mentha this time in many villages of Saheb Tehsil. Actually, this time demand was high in the market and availability of Mentha Oil was low. Crop in also decreased.

In such a situation, there was a demand for Mentha Oil in too. Farmers and businessmen are hoping that this time the harvest of mentha will be more. Because for a few years the price of Mentha was very low.

Since last few years the number has been steady to lower. But in response to decent appreciation in last years’ prices, farmers sowing improved resulting in rise in production prospects.

Therefore, the total availability of oil will rise this year. As of now traders expect a 20-25% rise in sowing versus last year. It should be noted that this year’s production expectation of 38500- 39000 MT remains slightly above the average production of 36,968 MT productions seen in between 2013- 2018.

Further expectations of a significant jump in production over last year is ruled out. Due to improving exports prospects, estimates for ending stocks has been reduced even lower than previous year. Mentha oil spot at Sambhal closed at 1742.20 per 1kg. Spot prices was down by Rs.21.90/-.

Trading Ideas:
–Mentha range for the day is 1575.4-1625.8.
–Mentha Oil spot at Sambhal closed at 1742.20 per 1kg. Spot prices was down by Rs.21.90/-.
–Mentha Oil dropped on profit booking tracking weakness in spot demand after prices gained amid low supply.
–Export demand of oil and its derivatives in global market is likely to be improved due to recovery in currency which is supportive for prices.
–Farmers have started preparing to harvest mentha this time in many villages of Saheb Tehsil.

Courtesy: Kedia Commodities

Source: Commodityonline.com