InvestorQ : How have mentha oil futures on MCX and NCDEX helped mentha exporters?
Sam Eswaran made post

How have mentha oil futures on MCX and NCDEX helped mentha exporters?

Answer
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Dia Deshpande answered.
2 years ago


India is the largest producer of mentha oil by a huge margin. India accounts for nearly 83% of global mentha oil output and over 60% of its output is exported. For exporters, the big challenge is to protect against the vagaries of price movements by selling mentha oil futures of a future dated monthly contract. While the eventual price of mentha oil is still not under the control of the exporter, what this futures hedging ensures is that assured price is locked in well in advance. That gives the exporter the leeway to plan his finances and also approach the bankers for the appropriate funding mechanism.