Edible oils: India
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Consumption trends
2015
Namrata Singh, Sales of packaged edible oil surge, May 27, 2017: The Times of India
In a clear uptrading of consumers in edible oils, even as those categorised under the high Socio Economic Classification (SEC) A and B are the main drivers of packaged edible oils in the country , increasingly , consumers from SECs C, D & E -the mid-to-lower categories -are converting to packaged edible oils from traditional loose oils.
On the other hand, with growing health consciousness, premium oils priced upwards of Rs 110 a litre are sourcing gains from loose oils as well as mid-priced packaged oils. This has gradually resulted in the bridging of the gap between premium oils and other packaged oils, said industry experts.The average consumption of premium oils is 1.2 litres per household per month, while the average consumption of other packaged oils stands at 1.59 litreshouseholdmonth.
According to IMRB data on edible oils, consumption of packaged edible oils is on the rise while that of loose oils has declined. In 2016 (January-December volumes in terms of litres per household member), all India urban plus rural average consumption of packaged edible oils rose to 4.6 as compa red with 4 in 2015. On the other hand, loose oils consumption declined to 4.5 from 4.6.
Sudhakar Desai, CEO, Emami Agrotech, which recently launched its `Emami Healthy and Tasty' brand nationally -and which is a leader in West Bengal -said, “Due to a constant trend of users upgrading themselves to premium variant, by the law of averages only, usa ge of premium edible oil does not get significantly affected by any healthy lifestyle trend. With fast changing lifestyles and health awareness, demand shift to premiumhealthy oils will increase at a faster phase.“
Desai said consumption of packaged edible oil commands a share of around 38% in the entire edible oil market in India, mainly driven by SEC A and B users. The premium variants among the packaged edible oils have higher penetration among these two segments of users, which accounts for almost a fifth of the total packaged oil users in India.
According to Saugata Gupta, MD & CEO, Marico, which markets `Saffola' edible oil, premium oils are expected to grow fast since this segment is maturing through penetration. Current household penetration of any premium oil is 21%, with huge headroom for growth.
Production, domestic
From Vedic times to net-importer in 2022
Vikram Doctor, May 7, 2022: The Times of India
In the late 1930s excavations at Harappa uncovered “a quantity of lumped and burnt Sesamum”, according to an account by archaeologist M S Vats. It was found in strata dated to 3050-3500 BCE, which makes it the earliest confirmed human use of sesame seed. It is not clear how it was used, but it is possible it was being crushed for oil, which would make it one of the earliest examples of edible oil production.
Later evidence of sesame oil-pressing is clear. “From Vedic times, the sesame seed was tila and sesame oil was taila, while tilaka signified of or from tila. To these three words were attached suffixes to denote an oilpress, comprised of the three terms, pesharna (to grind), yantra (machine) and chakra (wheel),” writes food historian K T Achaya in ‘Ghani’, his study of the traditional Indian oil-press. Til gave us tel, meaning all edible oil.
This antiquity of ghanis shows how oil-pressing was possibly the earliest example of food production being outsourced. It was also one of the first foods to be traded. Achaya notes “repeated mentions of guilds of oil millers in the Buddhist canonical literature,” dating to around 400 BCE. Olive oil was the foundation of fortunes in the Mediterranean world. Today, edible oil is a key product for agrobusiness giants, both foreign, like the ABCD companies (Archer-Daniels, Bunge, Cargill and Louis-Dreyfus) and Indian, like Adani-Wilmar.
From a consumer viewpoint, distancing from oil production made it easier to accept different oils, especially when marketed in skilful ways. The first really big food brand created for the Indian market was Hindustan Lever’s Dalda vanaspati (now owned by Bunge), which was edible oil made solid through hydrogenation.
When Dalda launched in the 1930s, traditional ghanis were still widely operational, and championed by Mahatma Gandhi as part of his emphasis on rural industries. But cheaper and more convenient Dalda started scoring over ghani.
But even till the early 1970s India was about 95% self-sufficient in edible oils. The types of oil consumed were still linked to local production, like coconut oil along the coasts, mustard oil in North and East India, peanut, safflower and sesame oil in West and South India.
The crop failures of the 1960s took a toll on edible oil production, but the real problem came in the response to them. While the failures in rice and wheat production led to the breeding of new, resilient and higher producing crop varieties that are called the Green Revolution, oilseeds (and pulses) did not see such development. Prices started rising which led the government to allow import of palm oil, mainly for making vanaspati. Imports got a further boost as diets became more varied with economic development.
People weren’t just consuming more oil directly, but also in the form of products like biscuits, instant noodles (partly pre-cooked in oil) and crunchy deep-fried snacks.
The Indian government did try to increase oilseed production. Dr Verghese Kurien was roped in to replicate his success with milk with edible oil, which he did with the Dhara brand in the 1980s, even as health issues associated with hydrogenation led to liquid oils becoming the larger category. Sam Pitroda was put in charge of the Technology Mission on Oilseeds, which boosted the area under oilseed cultivation. Attempts were made to develop new sources of edible oil, like sunflower and canola. Even niche alternatives traditional to India were examined like the use of tree-based sources of fats such as sal, kokum and mango kernel seeds which could substitute mainstream edible oils that were being used in products like soap.
India’s self-sufficiency in edible oil increased again, until two events in the 1990s reversed this. One was India’s signing of the World Trade Organisation (WTO) agreement which reduced the government’s scope to protect Indian products. Given a choice between rice, wheat and sugar, which were more emotive for consumers and important for farmers, and oilseeds (and pulses), which were less so, the latter were opened up for imports.
The second was an outbreak of severe health problems in 1998 linked to contamination of mustard oil. How this happened has never been clearly established, and allegations of conspiracy have been raised. It certainly greatly benefitted the new and usually imported types of oils being sold by large companies, like soybean and palm, with all their well-marketed claims of health.
This tipped the balance and from our earlier near self-sufficiency, India has become the world’s largest importer of edible oil. The current crisis in edible oil prices has been predicted for years and scepticism persists about how serious the government is about returning to self-sufficiency, especially when the means being promoted, like palm-oil production in the Northeast, comes with its own set of environmental problems.
