Mentha oil futures launched

In order to widen the commodity basket, the Multi Commodity Exchange of India Ltd (MCX) began futures trading in mentha oil contracts on Tue...

In order to widen the commodity basket, the Multi Commodity Exchange of India Ltd (MCX) began futures trading in mentha oil contracts on Tuesday. Mentha oil, extracted from mint leaves and used in a range of industries from FMCG to pharmaceuticals, becomes the 52nd commodity to be traded on the MCX.

The initial contracts available for trading will be for expiry dates of June 30 and July 31. The product would have a tick size of 10 paise offering low impact cost with the lot size at 2 drums (360 kg) and the price quotation in Rs/kg. MCX, having fixed the delivery centre as Sambhal, said the basis for trade would be 68 per cent liquid mentha oil.

The first day, which had trading for only 45 minutes after the inauguration at 4.15 pm, saw trade of around 30 tonnes ranging between Rs 350-354/kg at a value of Rs 93 lakh.

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That the open interest volumes were over 8,000 kg and the impact cost (indicating the liquidity in the market) between 20-30 paise as against the physical market rate of Rs 5, showed that the initial interest in mentha oil was good, MCX CEO Anjani Sinha said.

Mentha oil, which has a sizeable price volatility — prices range from Rs 300 to Rs 1,000 per kg a year, say analysts — suits the commodity markets fine. In the last one year, it has risen from Rs 275/kg to Rs 550/kg, but presently quotes Rs 375/kg. With an annual production of 18,000 tonnes, India has overtaken China as the top mentha oil producer.