Commodities

MCX clearing arm orders audit of mentha oil delivery process

PALAK SHAH Mumbai | Updated on February 26, 2020 Published on February 26, 2020

MCX CCL, the clearing arm of Multi Commodity Exchange (MCX), has ordered an audit of the end-to-end delivery process of mentha oil, sources close to the commodity bourse told BusinessLine.

Mentha oil is a contract traded on MCX platform. Swati Menthol and Chemicals, one of the largest exporters of the commodity and a trader on MCX, had complained of adulteration in the product, the sources said.

At its board meeting earlier this month, MCX CCL informed the members that a lab test of the product had not shown any adulteration. But, following regulatory requirement, they had ordered an end-to-end audit and probe of the processes involved up to the delivery of the oil.

When contacted, the MCX group spokesperson said, “We have received it (an email query sent by BusinessLine). If (there is) any response from our side, we will let you know.”

. Neither Swati Menthol nor logistics firm and YAMADA respond to email queries.

MCX CCL also informed its board about a robbery attempt at one of its mentha oil warehouses in Uttar Pradesh, which is managed by YAMADA.

Sources told BusinessLine that MCX CCL informed its board members that “A gang of thieves attacked the armed gunman and slit his throat and ran away, leaving behind empty cans they had brought along in the adjoining field... The warehouse seal and the lock were intact. SEBI, WDRA (Warehousing Development Regulatory Authority) and RMC (Risk Management Committee) of CCL were informed of all this late on Tuesday evening.”

The sources told BusinessLine that oil-filled drums were found in the field adjoining the warehouse and the UP police are probing the murder case.

According to market sources, India’s mentha oil production in 2019-20 was around 50,000 tonnes, although no official data is available. Around 75 per cent of the mentha oil produced in India is exported. The February month contract of mentha oil on MCX was trading at ₹1,190/kg, down 1.77 per cent from its previous close. The commodity has touched a lifetime high of ₹1,336. Stocks of mentha oil at MCX-accredited warehouses had declined to 77,799.35 kg by February 11 against 88,601.70 kg a week earlier. A higher mentha harvest is likely in 2020-21 as more area is expected to brought under the crop in the new season.

Published on February 26, 2020
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