Mentha oil: Growing demand

An essential oil extracted by steam distillation from Mentha arvensis leaves, this commodity has in recent years caught the attention of the world with its versatile application for a variety of uses especially in food and non-food fast moving consumer goods.

The leaves are widely used in Indian households for making chatni, sauce etc.

With mint as the English common name, the crop is from family Mentha piperita L with botanical name of Lamiaceae.

Leaf is the part of plant used as spice.

Grown in subtropical and tropical climate, the plant is sown in February-March and harvested in May-July, predominantly in Uttar Pradesh followed at a distance in Punjab, Haryana, Himachal Pradesh and Bihar

Mentha oil

India is the world's largest producer and exporter of mentha oil which is widely used in as flavouring agent in food products including confectionery.

Additionally, its soothing effect on human body makes it a useful ingredient for perfumery, cosmetics and pharmaceutical products as well.

The product moves from the farmer to the distiller and then on to the crystallisation unit from where it is sold either to domestic end-users or export houses.

Chandausi in UP has emerged as the largest market for the product.

With rising demand, growers have been able to obtain remunerative returns.

Export

Export of mint products including menthol, menthol crystals and mint oils in the last three years ranged between 17,000 and 20,000 tonnes valued between Rs 1,200 crore and Rs 1,700 crore, according to the Spices Board.

Export value realisation

Export value realisation has been rising because of demand expansion and rising rate of usage for a variety of applications especially in the developed economies of the world.

Apart from India, other countries that produce this oil are China, Brazil and USA. There is a growing export market for mentha oil.

Cosmetics and food industry in industrial countries are the major users.

In recent years, mentha oil has faced considerable price volatility and unit value realisation on export has varied from year to year.

Producers, processors, consumers and exporters face price risks which can be managed by hedging in the commodity futures exchanges.

Those with no natural exposure to mentha trade can also benefit by undertaking ‘cash-and-carry' arbitrage and ‘calendar spread'.

Speculators can take directional view on future prices and accordingly take positions in mentha oil futures, according to commodity exchanges.

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