This Presentation gives detailed information regarding Indian Mentha Oil Production, Exports, Imports, By Products produced, Spot Market Prices of Mentha for last consecutive six years along with fundamental & technical analysis and ways to tackle the price volatility of the Mentha Oil in India.

1. PresentationonMentha Oil
PresentedBy:
Alive Jenny
Shekhar Jyoti Das
Sirajuddin
Rohan Shingare
Babbure Sachith
12 March, 2019

2. Introduction
Mentha Scientific Name : menthaarvensisandcommonlyknownas
Japanesemintorpudina
 Varieties & their contribution in total mentha oil Production:
Japanese mint oil (Mentha arvensis)-75%
Peppermint oil (Mentha pipertia) – 18%
Spearmint (Mentha spicata) – 7%
Mentha oil is obtained by steam distillation process ofMentha
leaves
India is the largest producer & exporterof mentha oil in World

3. SWOTAnalysis

4. Strengths
India is the Largest producer of Mentha oil. India accounts for almost 80 % of
World.
India enjoys the monopoly.
Suitable soil condition, rainfall, temperatures.
India exports nearly 60-62% of the total Mentha oil production.
Mint products including mint oils, menthol crystals and menthol powder, is the
single largest product group in the export basket accounting for 27% of spices
export from India

5. Weakness
Lack of properly organized marketing activities.
There is demand from various quarters for introducing minimum support price (MSP) for Mentha oil. But
there is no government intervention in Mentha oil market.
It is primarily a local middlemens market. Large number of local dealers and commission agents operates
in markets. As a result of this farmers do not get fair price.
The market is dominated by big players where as small farmers are disadvantaged by their
insignificant small size. These small farmers sell their output to local dealers who in turn deal with large
scale distilleries and exporters.
The physical market of this commodity is very fragmented.

6. Opportunities
Mentha oil market is at its nascent stage so, much is there to be
explored.
With proper infrastructure, proper marketing channel and technology
this market can prove to be good for the economy.
Increase in awareness.

7. Threats
Competition from China.
Weather in India.
Pest infection also damages the crop

8. CropSeasonality
India
Country Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
India
 Crop Cycle
Sowing : January- February
Flowering : March –Mid May
Harvesting : End of May –July
 Cuttings: 2-3 cuttings in a season
Sowing
Harvesting
Mentha Oil is a winter crop and grown in Rabiseason

9. Economiesforthecrop(PerHectare)
A. Total cost of cultivation -Rs. 25,000/-
B. Return(1) Oil yield -200 Kg(2) Oil Price -Rs. 350 -850/-per Kg.
C. Cost of Oil produced -Rs. 70,000 to Rs. 1, 70,000/-
D. Net Profit -Rs. 45,000 to Rs. 1, 45,000/-

10. MenthaOil processing
Crude
Mentha Oil
Terpenes
Isolated
Components
Deterpenated
Oil
Menthol
(70%)
Flakes Crystals
Dementholised
Oil (30%)
Rectified
DMO
Deterpenation
Rectification

11. Sectorwise Usage
Worldwideconsumptionof Menthaoil,byIndustry
Industry % Usage
Oral Hygiene 28%
Pharmaceuticals 26.6%
Tobacco 25.3%
Confectionaries 11%
Shaving Product 7%
Miscellaneous 2.1%
Sources: www.leffingwell.com

12. Global Scenario
World’s total Production generally hovers in the range of 35000-45000 tonnes
 Largest producer & Consumer : India
India
75%
China
18%
Others
7%
ShareinTotal Production
India
39%
China
26%
Europe
14%
ShareinTotal Consumption
Others
8%
USA
13%

13. EstimatedProductionandConsumption
Year 2011 2012 2013 2014
Opening
Balance
4800 12244 11591 2831
Estimated
Production
46000 42000 35800 36000
Availability 52814 54244 47391 38831
Total demand 40570 42653 44560 45000
Balance 12244 11591 2831 -6169

14. IndianScenario
UP
95%
Punjab
4%
Others
1%
State Districts
UP
Barabanki
Moradabad
Rampur
Bareilly
Punjab
Ludhiana
Jalandhar
Moga
Navasaher
 India is the largest producer and consumer of mentha oil inworld
 Uttar Pradesh is the largest mentha producing state in India
Major Producing Districts State wise share in total Production

15. IndianScenario:AreaWiseProduction(InMT)
2013-142012-132012-132011-122010-112009-102008-092007-08

16. IndianMenthaOilProduction Trend(InMT)
Source: Spices Board Of India &TradeEstimates
45000
40000
35000
30000
25000
20000
15000
10000
5000
0
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014

17. IndianForeign Trade of MenthaOil
CHINA
31%
U.S.A 24%
SINGAPORE
12%
GERMANY
8%
JAPAN 3%
BRAZIL 3%
U.K 3%
NETHERLA NDS
4%
Others
12%
Year
Quantity
(Tonnes) Value(Rs.)
2002-03 4185 15498.22
2003-04 11295 48474.34
2005-06 13589 56557.94
2006-07 10110 37991.76
2007-08 11143 50218.7
2008-09 14544 81320.66
2009-10 17642 110095
2010-11 21100 128050
2011-12 20500 142025
2012-13 19000 118972
2013-14 17450 169679
Source: Spices Board OfIndia
IndianMint ProductExport Destinations IndianMintProductsExport Trend

18. MintProductsExportsfromIndian(Tonnes)
Source: Spices Board OfIndia
Product 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14
Peppermint Oil 2472 2803.4 3352.9 4493.1 2856.2 3449.1
Spearmint Oil 146 291.6 348.8 262.2 91.3 220.3
Other Mint Oil 2381 3437 4110.7 5159.6 4229.5 3209.1
Menthol Crystal 1235 3552.6 4248.9 3973.9 4728 3331.5
Menthol 8311 7557.5 9038.8 6611.3 7095 7361.4
TOTAL 14544 17642 21100 20500 19000 17450

19. Mentha Oil Exporters in India
Exporters
Sharp Menthol India Ltd
Mentha Allied Products Limited
Mudar India Exports
Banwari Aromas Pvtltd
Jindal Drugs Limited

20. MAJOR TRADING MARKETS IN INDIA
States Regions
Uttar Pradesh Sambhal
Uttar Pradesh Barabanki
Uttar Pradesh Rampur
Uttar Pradesh Chandausi
Uttar Pradesh Badaun
Uttar Pradesh Bareilly
Maharashtra Mumbai

21. MenthaOil:Production,Exports&Prices
2013-142012-132011-122010-112009-102008-092007-08

22. MenthaOilPriceSeasonal Index
95
100
105
110
90
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Price seasonal index has been derived from last 6 year mentha oil spot prices

23. Fundamental Analysis
Bullish
Rising demand from confectionery on festive season
Demand from pharmaceutical industry is also expected to remain higher in coming months
ahead of winter season
Import demand from major importing countries such as China, the U.S., and Singapore.
Export to China is likely to remain higher as it is the largest importer of Indian mint product

24. Fundamental Analysis
Bearish
Present hike in prices might provoke farmers to increase acreage under menthacrop
Price of synthetic mentha oil in international market.
Production estimates will come into the market in January which mightcreate
pressure on prices
Prevailing weather conditions; the incidence of cold wave and heavy rains are
harmful during leaf formation.
Export demand might also cool down

25. ValueChain
The value chain consists of farmers, local dealers, big commercial oil distilleries and exporters.
The local dealers are present mainly in Rampur, Sambhal, Ramnagar and Massauli areas.
Distilleries are the vital link between the farmers and the end user of Mentha oil and its derivatives.
These distilleries are not onlymeeting the domestic industryrequirements but also cater tothe growing
export markets invarious parts of the world.

26. Problems inValueChain
Existing marketing channel is not perfect to ensure fairprice to farmers.
Farmers often resorts to distress sale of oil to local dealers due to compulsions to square off debts soon
after oil is extracted.
As it is dealt in bulk farmers do not have direct access to them. This gives an opportunity to local
market dealers to interface between the distilleries and farmers.
The local dealers make large pool of oil purchase from farmers and sell it to distilleries. Some of them,
over a period of time, have become leading exporters in some pockets and many of them established
linkages with pharma, cosmetics and confectionary companies
Many of them are disguised traders who do not want to be identified as Mentha oil dealers because
they didn’t want to be trapped by sales tax authorities.

27. MenthaOilFutures
Currently, three national multi commodity exchanges offer futures in Mentha oil. While MCX and NCDEX offer
futures in Mentha oil, National Multi Commodity Exchange of India Ltd (NMCEIL) trades in menthol futures.
The reason to include Mentha oil in futures trading was-
Mentha oil is a highly volatile commodity. Such volatility was the major trouble faced by the processors and
exporters.
Due to such inherent inefficiency, they offered lower price to the farmers.
In order to arrest volatility as well as to provide hedging tools to the physical market traders, processors and
exporters, futures trading in menthe oil were introduced.
This had resulted in higher producer·s share in consumers rupee or in this case exporters export realization. The
realization of better prices was also realized at exporter’s end.

28. TechnicalAnalysis

29. Avg closing price of
commodities
Current price of
commodities
Price Trend going
downwards
Price Trend going
upwards <80, Overbought,
so short position
>30, Oversold, so long position

30. Measures to reduce price volatility
Government regulation in quality testing and processing.
Forming FPOs
Involving FPOs in hedging
Government intervention in introducing minimum support price (MSP).
Duty free import for processing equipment.
Imposing tariff on imports
Forward Contracts by processors
Create awareness among the farmers regarding the price of Mentha oil so that they get fair price for their product.