Mentha to sober down

COMMODITY SPIKES

The last week saw slight bullishness sweeping the mentha oil market. However, market sources do not expect this to last long on the back of poor international demand.

Though demand is not strong, difference between the existing spot prices in Chandausi and the futures has made exporters buy the commodity direct from the exchanges.

This helped mentha gain some strength in futures. Mentha oil was quoting at Rs 615-630 a kg in the spot market last week, whereas futures rose to Rs 592 a kg.

According to traders, demand from China is very weak and a bit better in the US and Europe. "Margin in export is very low, ranging between 1-2 per cent," said a Chadausi-based exporter.

Though, chances of further push is rare, there could be a decline as sowing season nears. Sowing season will start by mid-February. And if there is good output, the spot prices may drop, said a market source. Since mentha lost its lower support level of Rs 625 a kg in December, the market has failed to gather any strength so far.