Menthol oil yesterday rose 0.36 percent to 883.1 on little demand after prices fell due to an increase in supplies of fresh harvests. Since harvesting activities have taken up, supplies have grown in Uttar Pradesh and Bihar. Growing yield boosted by excellent weather has improved production expectations. Additionally, rumors of a decline in menthol exports will affect prices. Pricing will be under pressure due to rising menthol imports and China’s restricted purchase.
Menthol shipments decreased by 51.60 percent to 183.98 tonnes from 380.12 tonnes during the same period in 2022. Approximately 86.13 tonnes of mentha were shipped in May 2023 compared to 97.85 tonnes in April 2023, a decrease of 13.60%. Mentha exports fell by 58.96% in May 2023 from 209.90 tonnes in May 2022 to about 86.13 tonnes. Bans on gutkha and pan masala in numerous states have resulted in decreased demand for those foods from the pan masala sector.
In 2020–21, Mentha oil output reached a historically high level. The region stayed almost unchanged from the previous year, but reduced yields had an impact on production. Due to a dramatic reduction in area and loss in yields as a result of extreme summer heat, production is expected to drop to approximately 46,238 MT in the current year. By the years 2021–2022, it will have decreased by almost 14%.
Technically, the market is under short covering because open interest decreased by -0.11% to settle at 930 while prices increased by 3.2 rupees. Mentha oil is now receiving support at 878.5, and a move below that level could result in a test of 873.9 levels. On the other hand, a move above that level could result in a test of 893.3 levels.
