India edible oil market was valued at $11.9 bn in 2016 and is forecast to grow at a steady CAGR of 5.5% between 2017 and 2024, culminating in 2024 revenue of $18.2 bn.
Industry at a Glance
Indian edible oil industry is ranked as the 4th leading industry after the U.S., China, and Brazil. Increasing per capita disposable income coupled with rising number of people opting for dining out frequently is a key factor expected to drive market growth over the forecast period. Availability of vitamin premix at subsidy along with rising convenience food consumption is anticipated to further bolster edible oil demand in the country. Effective fortification of products such as Vanaspati mandated with Vitamin A and Vitamin D fortification in 1953 along with recent mandate of 700 IU for every ounce of Vanaspati has been successfully implemented are positive developments shaping industry dynamics.
Major Indian states such as Gujarat, Rajasthan, and Bihar utilize a major quantity of oil for deep frying purposes than as generic cooking oil. Rising income levels among the middle class in aforementioned states have driven the demand for low-fat oils as a result of rising number of chronic disease cases along with increasing awareness among consumers. Strong demand for coconut oil emerging from the southern part of India is also anticipated to foster industry growth over the forecast period.
“Optimal Price Point (OPP) for India Edible Oil Products”
Estimated Average India Edible Oil product cost – $ xx. However, with improving access and availability of options, OPP and range of acceptable Prices (RAP) are going to change. We at Ameri Research continuously track these prices with our proprietary pricing model.
The edible oil industry in India is widely influenced by various factors such as raw material availability and change in government policies that determine pricing strategies adopted by key industry participants.
On the basis of product, the market has been segmented into palm oil, soybean oil, mustard oil, sunflower, groundnut oil, rice bran oil, and blended oil. Palm oil emerged as the dominant segment with over 30% of the overall market revenue. The segment is driven by increasing number of food processing facilities coupled by rising imports from Malaysia and Indonesia. Government has allotted 100% FDI in oil palm plantations which have enabled to reduce edible oil deficit and dependence on imports from Europe and Southeast Asia. India emerged as the second leading producer of rice bran oil after China and holds a potential of producing over 1 million tons of rice bran oil. The segment is still in budding phase and offers lucrative opportunities industry participants over the forecast period.
Retail emerged as the leading end-use segment and accounted for over 50% of the overall market revenue in 2016. Rapid urbanization coupled with large network of retail outlets is the driving force behind segment growth in the country. Increasing number of fast food chains, changing cooking patterns, along with introduction of numerous trans-fat free oil options has spurred edible oil consumption in food service industry. Robust growth in number of restaurants, bars, dining halls, casinos along with shift in trend towards convenience food is anticipated to boost segment growth further significantly.
Growth Drivers & Restraints
The Indian edible oil market holds large untapped potential and offers lucrative business opportunities for market participants to capitalize on. Population outburst, rising household income along with the emergence of food service sector has stimulated the demand for edible oils at a brisk pace. Increasing urban population coupled with upgraded retail network is anticipated to bolster regional market growth over the forecast period. However, heavy dependency on edible oil imports and large unorganized segment i.e. loose oil and unbranded products are anticipated to market growth and affect revenue generation.
Top Players & Company Share
Major companies operating in the Indian edible oil market include The Adani Wilmar Ltd., Cargill Inc., Ruchi Soya Industries Ltd., Agrotech Foods Ltd., Ricela Health, Jhunjhunwala Vanaspati Ltd., ConAgra Foods, Rasoya Proteins, Marico, NK Proteins, Kamani Oil Industries, Bunge Limited, and Gabani Industries. The market is projected to be controlled by numerous national and multinational brands due to the rising dependence on imports along with liberalization by the government.
- Edible Oil Market by Product (Volume, Tons; Revenue, USD Million)
- Palm Oil
- Soybean Oil
- Mustard Oil
- Sunflower Oil
- Groundnut Oil
- Rice Bran Oil
- Blended Oil
- Edible Oil Market by End-Use (Volume, Tons; Revenue, USD Million)
- Food Service
- Food Processing