Peppermint oil is extracted by steam distillation from the dried herb of Mentha piperita. The plant is native to Europe but is now cultivated in many parts of the world. The largest producers are America, China and India, with India producing around 600-700MT per annum (2014/15).
It grows in the traditional 'Mint Regions' of India, which are the north and north west areas of the country.
India's piperita exports in 2014 were approximately 400MT with Europe seen as the biggest buyer (France and UK totalling 43%) whilst the USA took 30% of India's exports.
Peppermint has a wide variety of uses across many sectors but is most commonly seen in products such as teas, candy, chocolate, aromatherapy, oral care, chewing gums and insect repellents.
Peppermint is also known for its health benefits including the treatment of irritable bowel syndrome and other digestive complaints.
The first cut distillation is almost over and almost 80-90% of the crop has been distilled. The yield poses a major problem since initial significant production came with lower menthofuran content. The yield declined to around 50% lower than the normal yield at 12-15 kg per acre. Despite the rest of the crop showing a reasonable amount of menthofuran levels at 3-4.5 %, yield was recorded at lower levels. the crop estimation has been revised downward from 600 MT to 500 MT. this has come as a setback for the much hoped easing of peppermint oil prices.
During late May, prices lowered significantly. Soon after, farmers started holding back material and stockiest began to hoard supplies. The cause can be traced back to last year when peppermint oil sold at very lucrative prices. As such, farmers are reluctant to sell their material at lower rates, and are holding back material in expectation of higher margins. Simultaneously, American mint dealers who had not bought significant material during the last two years have become active again. This has led to a surge in demand but limited availability in the market.
In the next few weeks if there is mounting pressure from Mentha arvensis, we can see some selling in the markets.
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