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Branded foods in India - forecasts to 2015: 2008 edition: Oils and fats
Verma, Raghavendra.just - food; Bromsgrove, (Nov 2007).
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Abstract
The oils and fats sector in India is also very diverse, with western and Indian manufacturers having to be sensitive to distinct regional
preferences for different fats and oils. There are seven other companies already selling rice bran oil in India, but the two major ones,
ITC Agro and Marico, blend it with sunflower oil and market their products under the Sundrop Heart and Saffola Gold brands
respectively. In general, according to a FICCI survey, branded oils and fats products are preferred by urban consumers because they
are increasingly becoming health-conscious and looking out for low cholesterol cooking media. This trend has not gone unnoticed by
smaller growers and cooperatives with crushing or solvent extraction units, who have started branding their products, said a FICCI
specialist.
Full text
The oils and fats sector in India is also very diverse, with western and Indian manufacturers having to be sensitive to distinct regional
preferences for different fats and oils.
According to reports from the Indian central government's Department of Food and Public Distribution, consumers in the south and
west prefer groundnut oil, while those in the east and far-north (notably the states of Himachal Pradesh, Haryana and parts of
northern Uttar Pradesh) prefer to use mustard and rapeseed oils. Across the south preference is often for coconut and sesame oils.
However, consumers in India's northern plain - including populous areas such as southern Uttar Pradesh and the state of Bihar - are
basically hard-fat consumers and therefore, according to the distribution department, prefer 'Vanaspati' - partially-hydrogenated edible
oil mixtures. The major companies that sell this product are Bunge India (which sells the Dalda brand); Wipro (Sunflower brand),
Ahmed Mills (Postman), ITC (Rath) and Rasoi (which sells Vanaspati under its own 'Rasoi' brand).
For the other more liquid oils, India's state-owned National Dairy Development Board's Dhara is one of the major oil brands, according
to a FICCI survey conducted in February 2006. This covers groundnut, sunflower and refined soybean and mustard oils in refined,
pungent and filter variants, with total monthly sales of 6,000 tonnes nationwide. The board recently launched a new Dhara brand line -
rice bran oil, which is a by-product of rice milling and which has proved popular among health-conscious customers.
There are seven other companies already selling rice bran oil in India, but the two major ones, ITC Agro and Marico, blend it with
sunflower oil and market their products under the Sundrop Heart and Saffola Gold brands respectively. Both companies advertise these
lines as being a low cholesterol product, with marketing campaigns depicting worried housewives picking their jars in supermarkets
while thinking about the venerable hearts of their middle-aged husbands.
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In general, according to a FICCI survey, branded oils and fats products are preferred by urban consumers because they are
increasingly becoming healthconscious and looking out for low cholesterol cooking media.
This trend has not gone unnoticed by smaller growers and cooperatives with crushing or solvent extraction units, who have started
branding their products, said a FICCI specialist. However, Bharat Mehta, executive director of the Solvent Extractors' Association, told
just-food that such small-scale locallymarketed products should not be considered as real commercial brands. He also claimed they
only command 8-10% of the Indian oils and fats market.
One big problem with the small brands is adulteration. K Paramasivan, president of the Tamil Nadu oil and seeds Association, told the
Business Line newspaper that adulteration in edible oils is rampant as refiners either incompletely refine imported palm oil, or blend it
with cheaper oils like soya and rice bran oils. He added that such practices are especially difficult to curb in unbranded products. There
is also a huge and growing gap in demand and supply for oils and fats made within India, and this also encourages producers to cut
corners, he said.
Indeed, India's National Council of Applied Economic Research (INCAER) has projected that the demand for edible oils in India will
grow at a rate of 5-6% per annum over the next five to ten years, which translates as an additional consumption requirement of
500,000-600,000 tonnes per annum. However, it expects domestic production to rise by only 300,000 tonnes, leaving the slack to be
taken up by a growth in imports of around 250,000-300,000 tonnes per year.
Such a boom in imports, although necessary, is causing domestic producers problems, however. Vanaspati manufacturers are already
protesting against the import of cheaper produce from Sri Lanka and Nepal. According to the Indian Vanaspati Producers Association,
cheap competing imports are actually switching consumers away from traditional Vanaspati producers. Specialist Vanaspati producers
are already small in number, compared with the 15,000 extraction units in place for all edible oils across India, according to KS oil
company estimates. Indeed, the recent decline has left only 120 installed Vanaspati production units out of 267 now in working
condition, and because of the imports the total capacity utilisation of those at work is only 20% and annual production has declined
from 1.15m tonnes in the 2005-2006 financial year to 1.09m tonnes in the 2006-2007financial year.
According to the Solvent Extractors' Association of India the total demand for edible oils across India will be 15.6m tonnes in 2010,
moving to 21.3 million tonnes in 2015.
Table 12: Edible oil (branded and unbranded)
demand projection, 2006-2015 (m tonnes, m
hectares and %)Table 13: Indian market potential
for processed edible oils, 2003-2015 (US$m)
Copyright Aroq Limited Nov 2007
Details
Subject Oils & fats;
Business forecasts;
Industrywide conditions;
Market potential;
Competition
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Location India
Classification 7000: Marketing
8610: Food processing industry
9179: Asia & the Pacific
Title Branded foods in India - forecasts to 2015: 2008 edition: Oils and fats
Author Verma, Raghavendra
Publication title just - food; Bromsgrove
Source details Branded foods in India - forecasts to 2015: 2008 edition
Pages 42-44
Number of pages 3
Publication year 2007
Publication date Nov 2007
Publisher Aroq Limited
Place of publication Bromsgrove
Country of publication United Kingdom, Bromsgrove
Publication subject Food And Food Industries
Source type Reports
Language of publication English
Document type Feature, Industry Reports
Document feature Tables
ProQuest document ID 213153972
Document URL https://search.proquest.com/docview/213153972?accountid=27541
Copyright Copyright Aroq Limited Nov 2007
Last updated 2011-07-21
Database ABI/INFORM Collection
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