MCX Mentha Oil under fresh buying; Resistance seen at 1214

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Technically Mentha market is under fresh buying as market has witnessed gain in open interest by 2.48% to settled at 1076 while prices up 9.2 rupees.

Now MCX Mentha Oil is getting support at 1199.4 and below same could see a of 1191.8 , and resistance is now likely to be seen at 1214, a move above could see prices testing 1221.

Mentha Oil on MCX settled up by 0.77% at 1206.9 amid improved demand from consuming industries at the domestic spot market. Further, lower arrivals from major producing belts of Chandausi in Uttar Pradesh also supporting prices.

However, upside seen limited amid expectations of higher acreage under mint in 2019 due to lucrative prices throughout last year. Export demand of oil in global market is likely to be improved due to recovery in currency which is supportive for prices.

The surge in output is likely due to buoyancy in planting intentions, not only in the traditional pockets of Uttar Pradesh and Bihar in recent days, but also in Madhya Pradesh. Mentha sowing may witness a huge jump this year because of high returns farmers experienced the whole of last year.

Production of mentha oil is expected to rise to 48,000-50,000 tn in 2019 from 33,000-35,000 tn last year. This year, sowing of the crop started towards the end of last month, a couple of weeks later than usual due to extended cold weather in all major growing regions.

Official data on mentha, with respect to sowing or production and export, is not available as trade in the commodity is tightly controlled by a few. This season, the area under mint is expected to be 250,000-265,000 ha. Mentha oil spot at Sambhal closed at 1293.60 per 1kg. Spot prices was up by Rs.3.60/-.

Trading Ideas:
–Mentha range for the day is 1191.8-1221.
–Mentha Oil spot at Sambhal closed at 1293.60 per 1kg. Spot prices was up by Rs.3.60/-.
–Mentha Oil settled up amid improved demand from consuming industries at the domestic spot market.
–Further, lower arrivals from major producing belts of Chandausi in Uttar Pradesh also supporting prices.
–However, upside seen limited amid expectations of higher acreage under mint in 2019 due to lucrative prices throughout last year.

Courtesy: Kedia Commodities

Source: Commodityonline.com