Edible Oil Industry-poonam

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EDIBLE OIL SECTOR IN INDIA March 22, 2013

P a g e | 1

E DIBL E OIL INDUST RY

EDIBLE OIL SECTOR IN INDIA

India Being the largest Producer of oi lseeds

Yet has to Import Oil from Abroad.

3 /22 /2013

Course number : 12MCE04

Course name: INTERNATIONAL BUSINESS

Group Ass ignment No: 31

Word count : 2230

Members Name & Enrollment No:

Kar i sh ma Go y a l -1 2 6 0 9 1 8 6

An k i ta Ag arwal -1 2 6 0 9 1 8 7

Aish n a Ja in -1 2 6 0 9 1 8 8

Sh i lp i Ben er j ee -1 2 6 0 9 1 8 9

Po o n am Gu p ta -1 2 6 0 9 1 9 0Ku n a l S in g h -1 2 6 0 9 1 9 1


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Table of ContentsE x e cu t i v e S u m ma r y . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . 3

I n t r o du c t i o n . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . 4

O b je c t i v e & M e th o d o lo g y ....6

Find ings.... 7

I m p o r t Scena r io . . . 7

Expor t Scena r io.... 1 0

Compar i son12

Consumpt ion Scena r io15

Reason....16

C h a l l e n g e s i n I n d i a n O i l S e c to r . . . . . . . . . 1 7

D e p e n d e nce on vaga r ie s o f monsoon17

L a c k o f a d e q u a t e s e e d m u l t i p l i c a t i o n . . . . . . . . . . . . . . . . . . ....18

P r o d u c t i o n u n d e r e n e r g y s t a r t e d c o n d i t i o n . 1 8

V u ln e r a b i l i ty to pe s t s and d i sea se s.. . . . 1 8

W e a k i n f r a s t r u c tu r e . . 1 8

T e c h n i c a l i n e f f i c i e n c y o f o i l i n d u s t r y . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 9

Wea k t r a n s f e r o f t e c h n o lo g y . . .. . 19

R ec ommenda t ions.. . . .. . . . . 2 0

R e f e r e n c e s....22


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EXECUTIVE SUMMARY

In d ia i s o n e o f th e l a rg es t p ro d u cers o f o i l seed s in th e wo r ld an d th i s

sec to r o ccu p ies an imp o r tan t p o s i t i o n in th e ag r i cu l tu ra l eco n o my .

In d ia co n t r ib u tes ab o u t 6 -7 % o f th e wo r ld o i l seed s p ro d u c t i o n . T h ere

h as b een a l a rg e g ap b e tween th e d o mes t i c d eman d an d p ro d u c t io n .

T h u s , th e co u n t ry mee t h a l f o f i t s ed ib le o i l r eq u i remen t s th ro u g h

imp o r t . T o ch eck th e in f l a t io n , s t a t e o wn ed t r ad in g co mp an ies ma y

s ta r t i n c reas in g th e i r o v er seas p u rch ases . T h e p o l i cy an d th e b u s in ess

en v i ro n men t a re co n d u c iv e fo r th e g ro wth o f th e sec to r mee t in g th e

h u g e d o mes t i c d eman d an d ca te r in g th e in te rn a t io n a l mark e t a s we l l .

Acco rd in g to th e l a t es t r ep o r t s fo u n d f ro m T h e Min i s t ry Of

Ag r icu l tu re , In d ia th e imp o r t s o f v eg e tab le o i l i n In d ia h as in c re ased

b y 2 2 % b y Fe b r u a ry 2 0 1 3 . t h e r e as o ns b e h i nd th i s in c r ease a r e m an y

su ch as p o p u la t io n g ro wth , r i se in in co me l ev e l s , r i se in sp en d in g

p o wer o f t h e In d i an p op ul a t i o n , mo re an d mo r e c on s u mpt io n r i s e an d

man y mo re .

In d ia i s in to b o th imp o r t an d ex p o r t o f th e o i l seed s b u t imp o r t s mu ch

h ig h er q u an t i ty o f o i l t h an ex p o r t in g i t . In d ia imp o r t s max imu m

q u an t i ty o f c ru d e Pa lm Oi l an d ex p o r t s max imu m q u an t i ty o f So y b ean

o i l , t h e q u an t i t i e s o f r e s t o f th e o i l seed s a re n eg l ig ib le b u t th e q u an t i ty

o f imp o r t s o f th e o th e r o i l s o n th e co n t ra ry i s h ig h .

T h e p ap er a ims to d i scu ss th e p ro b lem p er s i s t in g in th e In d ian o i l

in d u s t ry an d to p ro v id e v iews o n h o w can th e In d ian o i l i n d u s t ry can

o v erco me th i s s i tu a t io n . In b es t in t e r es t o f th e co u n t ry , to in c rease th e

y ie ld o f th e o i l seed s w i th in th e co u n t ry an d to min imize i t s imp o r t s i t

mu ch p ro d u ce mo re q u an t i ty o f o i l seed s , co n su me l ess , g o v ern men t

sh o u ld p ro v id e mo re remed ies an d mu s t a l so wo rk h a rd er o n th e

in f ras t ru c tu re o f th e in d u s t ry .


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INTRODUCTION

In d ia i s o n e o f th e l a rg es t p ro d u cers o f o i l seed s in th e wo r ld an d th i s

sec to r o ccu p ies an imp o r tan t p o s i t io n in th e ag r i cu l tu ra l eco n o my .

Oi l seed s an d ed ib le o i l s a re two o f th e mo s t sen s i t i v e essen t i a l

co mmo d i t i e s . In d ia g ro ws o i l seed s o n an a rea o f o v er 2 6 mi l l io n

h ec ta res , w i th p ro d u c t iv i t y o f a ro u n d 1 0 0 0 k g a h ec ta re . Bu t se l f

r e l i an ce in ed ib le o i l s i s n o t in s ig h t an d th e co u n t ry imp o r t s a lmo s t

h a l f o f i t s ed ib le o i l r eq u i remen t s .

In d ia h as a w id e ran g e o f o i l seed s c ro p s g ro wn in i t s d i f f e ren t ag ro

c l imat i c zo n es . Gro u n d n u t , mu s ta rd / rap eseed , sesame , sa f f lo wer ,

l in seed , in v er sed /cas to r a re th e majo r t r ad i t io n a l ly cu l t iv a ted o i l seed s .

So y b ean an d su n f lo wer h av e a l so assu med imp o r tan ce in r ecen t y ea r s .

Co co n u t i s mo s t imp o r tan t amo n g s t th e p lan ta t io n c ro p s . Amo n g th e

n o n -co n v en t io n a l o i l s , r i ce b ran o i l an d co t to n seed o i l a re th e mo s t

imp o r tan t . T h e In d ian ed ib le o i l i n d u s t ry i s co mp o sed o f so me 1 5 ,0 0 0

o i l m i l l s , 6 0 0 so lv en t ex t rac t io n u n i t s , 2 5 0 v an asp a t i u n i t s an d ab o u t

4 0 0 re f in in g u n i t s .

T h e Na t io n a l co u n c i l o f Ap p l i ed E co n o mic Research h as p ro jec t ed th e

d eman d fo r ed ib le o i l s u n d er th ree sce n ar io s o n th e b as i s o f p e r cap i t a

in co me g ro win g an n u a l ly b y 4 %,5 % an d 6 %.Un d er th e lo w g ro wth

scen ar io , th e d eman d was to r i se to 2 2 .8 mi l l io n to n es , u n d er med iu m

g ro wth scen ar io to 2 5 .9 mi l l io n to n es an d u n d er h ig h g ro wth scen ar io

to 2 9 .4 mi l l io n to n es in th e n ea r fu tu re . T h e ed ib le o i l i n d u s t ry i s

l a rg e ly d o min a ted b y th e b u lk seg men t . Un b ran d ed seg men t acco u n t sfo r an y wh ere b e tween 8 0 an d 9 0 % o f th e t o ta l co n su mp t io n . Imp o r t s

a re t ak in g p lace in two fo rms - re f in ed an d c ru d e o i l . A l a rg e p a r t o f th e

c ru d e o i l g e t s so ld as u n b ran d ed o i l . T h e sh are o f r aw o i l , r e f in ed o i l

an d v an asp a t i i n th e to ta l ed ib le o i l mark e t i s e s t im a ted a t 3 5 %, 5 5 %

an d 1 0 % resp ec t iv e ly .

Wi th g ro win g q u a l i ty co n sc io u sn ess an d p lu mmet in g p r i ce d i f f e ren ces

b e tw ee n p ack ag e d a n d no n -p a ck ag ed e d ib l e o i l s , t h e p a ck ag ed ed i b l e


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o i l sec to r w i l l cap tu re 5 0 % o f th e mark e t sh a re in co min g y ear s . T h e

p a c k a ge d b ra nd ed ed ib le o i l i n du s t ry i s g r ow in g a t 1 2 % an n ua l l y.

M a j o r P l a y e r s l i k e M a r i c o I n d us t r i e s i s t h e m a r k e t l e a d e r w i t h i t s t w o

main b ran d s , Sweek ar an d Saf fo la , h av in g 1 5 % mark e t sh a re , fo l lo wed

b y IT C Ag ro t e ch s S un d ro p a t 1 3%. Go d r e j Fo od s h as a m a rk e t sh a r e o f

1 1 % an d HL L s F lo ra h as 3 %. Carg i l se l l s ed ib le o i l t h ro u g h Natu re

Fresh an d Gemin i b ran d s , Ru ch i g ro u p s w i th Ru ch i Go ld an d Mah ak o sh

o i l ,Ad an i Wi lmar L imi ted , o wn er o f Fo r tu n e b ran d , Na t io n a l D ia ry

Dev e lo p men t Bo ard ' s Dh ara b ran d an d o th e r smal l p l ay er s o wn res t o f

th e p ack ag ed ed ib le o i l mark e t .


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OBJECTIVE AND METHODOLOGY

Obj ec t ive - T h e o b jec t iv e o f th i s p ap er i s to f in d o u t th e r easo n b eh in d

wh y In d ia b e in g th e l a rg es t p ro d u cer o f o i l seed s y e t h av e to imp o r t o i l

to mee t i t s d o mes t i c r eq u i remen t s .

Met hodo logy- We a im, a t d e te rmin in g th e r easo n s b eh in d th e in c reas ed

imp o r t s o f o i l an d we t en d to ach iev e i t v i a f in d in g o u t th e fo l lo win g .

We h av e t ak en in to co n s id e ra t io n th e Imp o r t d a ta an d E x p o r t Da ta o f

ed ib le o i l i n In d ia , T ar i f f d a t a , Co n su mp t io n ra t e o f th e ed ib le o i l

w i th in th e co u n t ry , Gro wth ra t e o f th e ed ib le o i l an d Deman d ra t e o f

th e ed ib le o i l . T h e d a ta so u rces a re S ea d a ta b an k ,

h t tp : / /www. in d ex mu n d i . co m, min i s t ry o f Ag r icu l tu re an d resea rch

p a p e rs .


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FINDINGS

Import Scenar io

Be lo w i s th e t ab le sh o win g th e imp o r t s mad e b y In d ia o f th e Cru d e o i l -

IMPORT OF EDIBLE OIL ( QUANTITY IN T ONNES)

YE A

R

REFI

N ED

PALM

OLEI

N

C RU

DE

PAL

M

OIL

CRU

DE

SUN-

FLO

WER

O IL

CR

UD

E

RA

PE

O IL

CRUD

E

SOYAB

EA N

O IL

CR U

DE

C OC

O NU

T

OIL

C RU

D E

PAL

M

KER.

O IL

TOTA

L

IMPO

R TS

TOTA

L

IMPO

R T

O F

CRUD

E OIL

2008

-

2009

1 2 4 0 0

1 8

5 1 8 7 0

6 3

5 9 0 1 7

5

4 6 3

6 2

9 8 9 6 1 3 1 6 6 9 3 1 0 7 6 2

2

8 1 7 7 5

4 6

6 9 3 7 5

2 8

2009

-

2010

1 2 1 3 4

0 9

5 1 6 9 4

4 5

6 3 0 0 0

5

1 3 9

5 0

1 6 6 6 4 9

2

4 1 9 8 1 1 1 9 7

3

8 8 0 9 4

7 2

7 5 9 6 0

6 3

2010

-

2011

1 0 8 1 6

8 6

5 3 7 4 3

3 3

8 0 3 5 9

3

1 1 1

2 2

1 0 0 6 6 9

1

2 9 6 7 8 4 5 6 6 8 3 6 4 9

5 8

7 2 8 3 2

7 2

2011

-

2012

1 5 7 7 3

5 5

5 9 9 3 6

6 5

1 1 3 4 8

8 1

9 0 7

5 8

1 0 7 9 0 0

4

1 9 9 9 9 7 9 0 3 9 9 7 5 5

6 5

8 3 9 8 2

1 0

S o u rce- sea d a ta b a n k

Fro m th e ab o v e t ab le we can see th a t In d ia imp o r t s max imu m q u an t i ty

o f Cru d e Pa lm Oi l f ro m Ab ro ad an d l eas t q u an t i ty o f Cru d e Co co n u t

Oi l an d d u r in g th e y ea r s we see th a t th e q u an t i ty d eman d ed o f Co co n u t

c ru d e o i l i s d ec reas in g b u t th a t o f p a lm , p a lmo le , su n f lo wer , r ap e an d

p a lm o i l i s in c r eas i n g . Wh e re as , d em an d f o r P a l m o i l k e ep s on

in c reas in g in i t i a l ly an d th en d ec l in in g .


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T h e ab o v e d iag ram i s sh o win g th e g ro wt h in imp o r t o f ed ib le o i l d u r in g

th e y ea r s 2 0 0 8 to 2 0 1 2 .As f ro m th e d iag ram we can see th a t t h e imp o r t

fo r r e f in ed p a lmo le i n h as r emain ed mo d era te th ro u g h th e y ea r s b u t th e

q u an t i ty i s h ig h . C ru d e Pa lm o i l d eman d i s max imu m an d d eman d fo r

c ru d e co co n u t o i l i s m in imu m. We can a l so see th a t th e imp o r t s were

co mp ara t iv e l y l e s s in th e y ea r 2 0 0 8 -0 9 an d h av e k ep t in c reas in g

th e rea f t e r wh ich imp l i es th a t th e d o mes t i c n eed o f o i l i n In d ia h as k ep tin c reas in g th ro u g h th e y ea r s .


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T h e ab o v e d iag ram i s sh o win g th e to ta l amo u n t o f imp o r t s mad e b y

In d ia in a fo rm o f a p ie ch ar t an d th e ex ac t sh a re o f ev ery o i l

co n t r ib u tes in th e to ta l imp o r t s . I t i s c l ea r th a t th e h ig h es t imp o r t s a re

o f Cru d e Pa lm o i l an d l eas t a re o f Cru d e rap e O i l .wh ereas , th e d eman d

fo r r e f in ed p a lmle in , c ru d e So y b ean an d Cru d e Su n f lo wer o i l r emain

co n s id e rab ly mo d era te b u t y e t h ig h in q u an t i ty .


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Expor t Scenar io

EXPORT OF OIL MEALS EXTRACTIONS(QUANTITY IN TONNES)

YEAR SOYA

BEAN

RAPES

EED

GROUND

NUT

RICE

BRAN

SUNFLO

WER

CASTOR

SEED

TOTAL

EXPORTS

2008-

2009

41773

14

840901 54781 144696 203915 5421607

2009-

2010

21143

91

752005 5500 110933 1492 240466 3224787

2010-

2011

38383

75

936238 21480 66650 209036 5071779

2011-

2012

38295

21

1171895 2863 176725 341308 5522312

S o u rce- sea d a ta b a n k

T h e ab o v e d iag ram h e lp s in g iv in g an in s ig h t o n h o w mu ch In d ia i s in to

ex p o r t in g th e ed ib le o i l . We can c l ea r ly see th a t In d ia ex p o r t s h ig h es t

q u an t i ty o f so y b ean o i l fo l lo wed b y rap eseed co i l d en cas to r seed o i l ,

Res t th e q u an t i ty o f g ro u n d n u t o i l , r i ce b ean o i l i s n eg l ig le an d In d ia

d o es n o t ex p o r t an y q u an t i ty o f Su n f lo wer o i l .


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T h e ab o v e d iag ram h e lp s to sh o w wi t h th e h e lp o f a p ie ch ar t th e

co n t r ib u t io n o f each ty p e o f o i l i n th e ex p o r t s . I t i s c l ea r th e max imu m

q u an t i ty o f so y b ean o i l i s ex p o r ted f ro m In d ia (7 0 %) fo l lo wed b y

Rap eseed o i l (2 1 %) res t a l l t h e q u an t i t i e s o f ex p o r t s a re n o t v e ry h ig h

an d o f su n f lo wer o i l i s p o o r ly 0 %.


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Comparison

IMPORT VS EXPORT (QUANTITY IN TONES)

YEAR TOTAL

IMPORTS

TOTAL EXPORTS

2008-2009 8177546 5421607

2009-2010 8809472 3224787

2010-2011 8364958 5071779

2011-2012 9975565 5522312

2008-2012 35327541 19240485

S o u rce: S ea Da ta Ba n k

Fro m th e ab o v e ch ar t we can see th a t th o u g h th e ex p o r t was h ig h in th e

y ear 2 0 1 1 -2 0 1 2 co mp are to y ea r 2 0 1 0 -2 0 1 1 b u t th e imp o r t o f th e ed ib le

o i l p ro d u c t i s g e t t in g h ig h er ev ery y ea r in t e rms o f ex p o r t In In d ia .


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T h e % acq u i red b y th e ed ib le o i l imp o r t f ro m las t fo u r y ea r s i s 6 5 %

wh ich i s c lo se to th e d o u b le o f th e E x p o r t % f ro m th e l a s t f o u r Years .

Price Ratio

Month Soybean Oil Price

(Indian Rupee per

Metric Ton)

Palm oil Price

(Indian Rupee per

Metric Ton)

Soybean

Oil

ROC

Palm

oil

ROC

Soybean Oil

/ Palm oil

Price Ratio

Aug-12 66,033.05 51,704.25 - - 1.2771

Sep-12 66,195.85 47,985.85 0.25% -7.19% 1.3795

Oct-12 59,309.16 40,676.81 -10.40% -

15.23%

1.4581

Nov-

12

58,646.61 40,664.00 -1.12% -0.03% 1.4422

Dec-

12

59,465.10 38,992.74 1.40% -4.11% 1.525

Jan-13 60,984.49 42,176.37 2.56% 8.16% 1.4459

Feb-13 60,836.44 42,585.19 -0.24% 0.97% 1.4286

S o u rce: h t tp : / /www. in d exmu n d i . co m/co mmo d i t i e s


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Source:http://www.indexmundi.com/commodities

Fro m th e r ecen t d a ta an d th e ab o v e f in d in g s th e so y a o i l an d p a lm o i l

a re th e majo r p ro d u c t s o f th e ed ib le o i l i n d u s t r y . So th e re i s th e r a t e

f lu c tu a t io n in b o th th e p ro d u c t s ac co rd in g to th e d eman d an d

co n su mp t io n .


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Consumption Scenario

Do mes t i c co n su mp t io n o f ed ib le o i l s h as b een g ro win g a t 4 .0 -5 .0

p e r c en t a ye a r . T h e co n su mpt i o n i n 2 00 1 -0 2 was a ro u n d 25 . 75 mi l l io n

to n s . No n -p ack ag ed o i l s acco u n t fo r n ea r ly 5 0 .0 p e rcen t o f

co n su mp t io n in b o th u rb an an d ru ra l mark e t s . In th e r emain in g 5 0 .0

p e r c en t c on t r i b u t ed b y p a c k ag ed o i l s , b r a nd e d o i l s co ns t i t u t e a s ma l l

p o r t i on o f ap pr ox im at e l y 1 0 .0 - 15 .0 pe r ce n t .

Major Exporter & Importer

Mean wh i le , In d ia ' s o i l se ed p ro d u c t io n fo r mark e t in g y ear ( MY)

2 0 1 1 /1 2 (Oc t -Sep ) i s fo recas t h ig h er a t 3 5 .6 mi l l io n to n s .

T h e g lo b a l o i l seed t r ad e fo r 2 0 1 1 -1 2 i s p ro jec t ed a t 1 1 0 .5 mi l l io n to n s ,

d o wn 2 .6 mi l l io n main ly r e f l ec t in g red u ced so y b ean ex p o r t p ro jec t i o n s

fo r Braz i l , Arg en t in a , an d Parag u ay .

Oth er majo r ch an g es a ro u n d th e g lo b e a re h ig h er r ap eseed p ro d u c t io n

fo r Ch in a an d Ru ss ia , l o wer r ap eseed an d su n f lo wer seed p ro d u c t io n

fo r Kazak h s tan , an d h ig h er co t to n seed p ro d u c t io n fo r Pak i s t an .

In d ia imp o r t s ed ib le o i l ma in ly f ro m In d o n es ia an d Malay s ia .


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Why the Domestic Consumption of Edible Oil is Increasing

in India

Du e to h ig h g ro wth in in co me l ev e l s , i n c reas in g t r en d in sp en d in gan d b e t t e r l iv in g s t an d ard s , i n d ia p ro mises to co n t in u e h ig h

g ro wth in co n su mp t io n o f ed ib le o i l s an d In d ian co n su mp t io n may

reach 2 1 0 L ac MT b y 2 0 1 5 /1 6 .

A b ig ex p an s io n in th e th e mid d le c l ass , d u e to b ig r i se u nin co me l ev e l s o f th e p o o r c l ass .

T h e d o u b le D ig i t g ro wth o f o u t o f h o me co n su mp t io n o f ed ib leo i l .

Per cap i t a co n su mp t io n o f ed ib le o i l i n In d ia a t 1 2 .7 Kg i s s t i l l alo t b e lo w th resh o ld l ev e l o f co n su mp t io n . L o w co n su min g s t a t es

o f cen t ra l an d eas t In d ia a t 7 - 9 Kg a re ca tch in g u p w i th th e i r

p e e r s o f wes t an d no r th In d i a a t 1 5 -1 7 Kg .

E v en wi th mo d era te p o p u la t io n g ro wth th e ab so lu te in c rease inn u mb er o f p eo p le i s q u ie t h ig h .

Sp ec ia l sch emes a re h e l p in g in r i s in g th e l ab o r in co me an din creas in g th e in co me l ev e l o f p eo p le wh o a re co n su min g mu ch

b e lo w th e a l l In d i a l e v e l .

Ris in g u rb an p o p u la t io n an d man y mo re .


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P a g e | 17

CHALLENGES IN INDIA EDIBLE OIL SECTOR

E d ib le o i l i s co n s id e red as e ssen t i a l co mmo d i t i e s in in d ia .w i th i t s l a rg e

p o pul a t i o n a nd con t i nu ed s t ro n g eco n om ic g r o wt h , In d i a i s l i k e l y t o

reg i s t e r s t ro n g g a in s in to t a l an d p e r cap i t a ed ib le o i l co n su mp t io n in

th e co min g d ecad es . T h e ex ten t to wh ich in c reased co n su mp t io n i s me t

b y i mp o r t s a nd th e t yp e o f o i l i mp o r te d w i l l b e s t ro n g l y i n f l ue n c ed b y

In d ia s t r ad e an d d o mes t i c ag r i cu l tu re p o l i c i es .T h u s th e re i s a

req u i remen t o f r ed u c t io n o f d ep en d en ce o f o i l imp o r t co u ld b e b ro u g h t

ab o u t b y in c reased d o mes t i c o i l seed p ro d u c t io n an d amo n g s t o th e r s

mu ch s t ro n g er p r i ce in cen t iv e , p ro d u c t io n an d y ie ld imp ro v emen tap p en d ed b y s t ro n g er mark e t in g s t r a t eg ies wh ich w i l l l ead to

e f f i c i en c ies a t in d u s t ry l ev e l . Sev era l ch a l l en g es h av e b een id en t i f i ed

cru c ia l to th e g ro wth o f th e sec to r .

Dependence on vagar ie s o f monsoonT h e an n u a l o i l seed p ro d u c t io n o f th e co u n t ry i s f aced w i th h ig h d eg ree

o f v a r i a t io n as n ea r ly 7 6 % o f th e o i l seed s a rea i s u n d er r a in f edco n d i t io n an d th e re fo re su b jec ted to u n cer t a in t i e s o f mo is tu re

av a i l ab ib i l i ty .Av a i l ab i l i ty o f q u a l i ty seed o f imp ro v ed v a r i e t i e s an d

h y b r id i s g ro ss ly in ad eq u a te an d i s o n e o f th e majo r co n s t ra in t s in

en h an c in g th e o i l seed p ro d u c t io n . in o i l seed th e f a rmer a re u s in g

p r e dom in a n t l y t h e s a v ed s eed r es u l t i ng i n ab o u t 80 % o f t h e a r e a s o wn

wi th seed o f o ld an d ab so lu te v a r i t i e s .Wi th th e ex cep t io n o f su n f lo wer

an d cas to r th e seed p ro d u c t io n o f o i l seed i s p r imar i ly l e f t w i th p u b l i c

sec to r ag en cy d u e to b u lk y n a tu re o f o i l seed c ro p s mo re in v es tmen t o n

in f ras t ru c tu re an d l e s s r emu n era t io n .

Lack o f adequat e s eed mul t ip l i ca t ion

Al th o u g h th e re i s en o u g h b red seed p ro d u c t io n in mo s t o i l seed c ro p

fu r th e r seed mu l t ip l i ca t io n th o u g h fo u n d a t io n an d ce r t i f i ed s t ag es a reth e k ey co n s t ra in t fo r av a i l ab i l i ty o f q u a l i ty seed mate r i a l


18/22


P a g e | 18

Product ion under energy s t arved condi t ion

T h ese a re en erg y r i ch c ro p b u t in In d ia th ey a re mo s t ly g ro wn u n d er en erg y s t a rv ed co n d i t io n . No u se o r lo w u se o f p lan t n u t r i en t i s o n e

o f th e mo s t imp o r tan t f ac to r s fo r lo w p ro d u c t iv i ty o f o i l seed s . T h e

n u t r i en t r eq u i remen t o f o i l seed in g en era l i s h ig h fo r a l l t h e n u t r i en t

th a t n eed s to b e su p p l i ed in ad eq u a te q u an t i t i e s fo r a t t a in in g h ig h er

y ie ld s

Vulnerab i l i t y t o pes t s and d i s ease sT h ey a re p ro n e to d amag e ab o u t b y 6 4 majo r d i seases . h ig h l ev e l o f

r e s i s t an ce i s fo u n d in cu l t iv a to r ag a in s t o n ly sev en (1 0 .9 9 %) d i seases

an d p a r t i a l r e s i s t an ce ag a in s t 1 6 (2 5 %) d i seases th u s in d ica t in g th e

lack o f g en e t i c in su la t io n fo r majo r i ty o f th e d i seases cu l t iv a to r s w i th

h ig h l ev e l o f r e s i s t an ce a re av a i l ab le fo r ru s t an d d o wn y mi ld ew in

su n f lo wer p o wd ery mi ld ew in r ap eseed mu s ta rd , ru s t in l in e seed w i l tan d ro o t ro t in cas to r an d mo sa ic d i sease in so y a b ean .

Weak in f ras t ruc t ure

Mu l t ip l i c i t i e s o f t ech n o lo g y t r an s fe r b y each l in e d ep ar tmen t an d th e re

i s l i t t l e co o rd in a t io n ac ro ss d i f f e ren t d ep ar tmen t in v o lv ed . Nar ro w

fo cu s o f th e ag r i cu l tu ra l ex ten s io n sy s tem i . e . l im i ted ac t iv i t i e s h av e

b e e n u nd e r t ak en t o d e v e l op an d t r an s fe r s us t a i n ab l e t e chn ol o g ie s t o t he

f a r m e r s .

Technica l ine f f i c iency o f o i l indus t ry

L i t t l e a t t en t io n was g iv en fo r d ev e lo p in g b o th t ech n ica l co mp eten ce

an d p ro fess io n a l sk i l l s to d i s semin a te th e imp ro v ed o i l seed


19/22


P a g e | 19

t ech n o lo g ies to t en f i e ld s t a f f a s we l l a s th e o i l seed g ro wers . So me o f

th em a l so d id n o t imp lemen t a sy s temat i c f r amewo rk th a t r e f l ec t s th e

p o t e n t i a l ro le wi t h in t h e ov e r a l l r e s e a rc h ex te ns io n s ys t e m s .

Weak t rans f er o f t echno logy

In d ian p ro cess in g in d u s t ry su f fe r f ro m sev era l ma lad ies l ik e o u td a ted

tech n o lo g y , lo wer r a t es o f u t i l i za t io n o f in s t a l l ed cap ac i ty lo w o i l

r eco v er i es an d h ig h u n i t co s t . T h e co s t o f v eg e tab le o i l p ro cess in g in

In d ia i s v e ry h ig h .As co mp ared to th e co u n t r i e s l ik e ch in a an d Usa

main ly d u e to smal l e r cap ac i t i e s , l o w tech n ica l e f f i c i en cy an d lo wcap ac i ty u t i l i za t io n .


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P a g e | 20

Recommendations

Based o n th e p ap er th e r eco mmen d a t io n we g iv e so as to in c rease th e

In d ian o i l seed p ro d u c t io n , fo l lo win g sh o u ld b e u n d er t ak en -

Compet ing In a Larger Cont ex tFo r fu r th e r imp ro v emen ts in o i l seed p ro d u c t io n n o tab ly in t e rms o f

y ie ld an d o i l an d p ro te in co n ten t s wh ich remain s b e lo w in te rn a t io n a l

s t an d ard s . In reas e in th e o i l an d p ro te in co n ten t an d y ie ld

imp ro v emen ts in th e n eed o f th e h o u r to co mp ete g lo b a l ly .

Fore ign Compet i t ion Encourages Ef f ic iency Ga insAlread y ex p o sed to fo re ig n co mp et i t io n in th e ex p o r t o f l a rg e

q u an t i t i e s o f o i l seed mea l s an d th e imp o r t o f ed ib le o i l s , t h e o i l see d

co mp lex h as to imp ro v e s ig n i f i can t ly i t s mark e t in g an d p ro cess in g

ef f i c i en c y to co u n te r th e a t t r ac t io n o f imp o r t s . T h e in cen t iv es fo r

o i l seed s mea l ex p o r t s so mewh at d i s to r t ed b y v a r io u s sch emes wh ich

in c rease ex p o r t ea rn in g s a r e d war fed b y th e co s t s imp o sed u p o n th e

in d u s t ry b y th e in e f f i c i en c ies o f th e t r an sp o r t an d p o r t

in f ras t ru c tu re .

Improv ing marke t ing and proces s ing e s sent ia l t o preservegra ins

T h e co n t in u in g r ig id i t i e s o f d o mes t i c p o l i c i es p rev en t th e o i l seed

co mp lex f ro m g a in in g th e max imu m b en ef i t o f ex p o su re to fo re ig n

co mp et i t io n .

Cent ra l Government Programs To Suppor t RapidTechno log ica l Change

T h e g o v ern men t p ro g rams su ch as Oi l seed g ro wers co o p era t iv e

p ro j e ct , Na t i on a l o i l s e ed d e v e lo pme nt p ro j ec t , t ech n o lo gy m i ss io n o

o i l seed s , e t c a l l p ro v id e to in c rease th e p resen t e f f i c i en cy o f th e

o i l seed sec to r .


21/22


P a g e | 21

Need f or Be t t er In f ras t ruc t ureA n eed o f b e t t e r in f ras t ru c tu re in fo rm o f b e t t e r mach in er y , b e t t e r

d o mes t i c p o l i c i es , mo re g o v ern men t r eg u la t io n an d p r i ce s t ab i l i ty ,

in c rease in p ro d u c t io n o n t ech n o lo g ica l b ases an d ad o p t io n o f n ewer

an d q u a l i ty ag r i cu l tu ra l t ech n iq u es .


22/22

EDIBLE OIL SECTOR IN INDIA March 22, 2013References

I n d i an Ed ib l e Oi l Sc e n ar i o in 2 0 1 5 , Ass o -Co m Gra in Co n fe r e n ce |Ma y 1 , 20 12

Ed i b l e O i l S ec to r i n In d i a: An Eme rg i n g P er sp e c t i ve An d p o l i c yI s su es ; D eb d e ep De ; pu b l i s h e d b y Ja yp ee b us i n es s S ch ool , 2 01 1

I n d i an Agr i cu l t ur a l Co mmo di t i e s -E di b l e O i l ;2 0 1 3 Out l ook S ta tu s o f Veg e ta b le O i l In d u s t ry - In d ia n Eco n o my; Dr . P .

S u b ra ma n ya ch a ry;2 0 1 3

h t tp : / /www. in d exmu n d i . co m/ h t tp : / /www.sea o f in d ia . co m/ h t tp : / /www.co mmo d i tyo n l in e . co m h t tp : / /www.resea rch a n d ma rke t s . co m h t tp : / /www.n i i r . o rg h t tp : / /www.n o vo d b o a rd . co m/ h t tp : / /a g r ico o p .n ic . in / re la tes i t e s . h tm

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