Centre plans to ban sale of loose edible oil

The Centre is contemplating banning sale of loose edible oils after the coronavirus pandemic raised safety concerns.

Deliberating on the challenges being faced by the edible oil industry in the post Covid-19 scenario, Atul Chaturvedi, president of the Solvent Extractors’ Association (SEA), during a webinar on Friday, said, “The government is contemplating ban on loose edible oils, which gives an opportunity for packaged and branded players to boost their sales.”

The ban, if imposed, would affect consumers of poor states, especially rural areas, as they still purchase edible oil sin very small denominations that are worth a few rupees.

Branded and packaged edible oils are currently selling at a premium of 50 per cent over loose varieties. Hence, products using edib le oils would be costlier, going forward.

Apart from daily wage earners and rural poor, producers of fried products on roadsides (like makers of samosa) normally consume voluminous quantities of loose edible oils. This is because they are cheaper than branded and packaged oils.

BVM eh ta, executive director, SEA, estimates that such consumers (of loose oil) contribute nearly 40 per cent of India’s edible oil consumption (to the tune of 23 million tonnes).

India imports around 65 per cent of its overall edible oil primarily from Indonesia, Malaysia and Argentina due to stagnant oilseeds production locally.

When the market opens after the nationwide lockdown, marketing strategy of all staple foods, including edible oils, would see a drastic change.

Many consumers would be shifting from unbranded to branded products and loose to packaged products for their safety.

“The nationwide lockdown has seen a massive demand destruction due to closure of hotels, restaurants and catering services. While some losses are permanent, others are temporary and may see recov

ery after the lockdown ends. So, players in the packaged oil category would have to be ready to grab this opportunity,” said Chaturvedi.

“After Covid-19, we are not going to change like robots but lifestyle is going to change. Consumers are going to be more health conscious, and therefore, will be looking at healthy products with no cholesterol or fats,” said Piyush Pandey, executive chairman India, Oglivy.

Meanwhile, Angshu Mallick, deputy chief executive officer, Adani Wilmar, producer of the ‘Fortune’ brand of edible oils, said, “The nationwide lockdown has severely hit India’s ‘out of home’ consumption of edible oils, especially from segments like bakery, ice creams, farsan and other products. These contribute nearly 27 per cent of India’s overall edible oil consumption.”