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Section 1: CPO Price Trend:
India's Oils and Fats Import Mix in 2019 - Outlook for Palm Oil
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By: Mr. Govindbhai G. Patel
a) He is Managing Partner of GG Patel & Nikhil Research Company. A first of its kind research company in India which is working on primary research about agricultural industry and its dynamics. The company has undertaken several projects & provides detailed statistics and information with its core competence in oils & oilseeds market.
b) He is Managing Partner of GGN International, an intermediary which helps Indian importers procure imported oils like CPO, Palmolein, Soybean Oil, Sunflower oil, Rapeseed oil etc.
c) He has spent more than 50 years in the oilseeds Industry, with experience on all aspects of the veg oil Industry. He has experience of running crush plant, solvent plant, and refinery to Vanaspati Industry. He has actively participated in Import of Vegoils & export of oil meals and oilseeds to Europe & South east Asia.
d) Ex - President of The Solvent Extractors’ Association of India, Mumbai (SEA) which is a Premier Association of Oils, Oilseeds and De-oiled Meals industry in India having more than 850 membership.
e) Ex - President of The Central Organization for Oil Industry & Trade, New Delhi (COOIT) – COOIT is an apex body for all the Associations situated in India relating to Edible Oils, Oilseeds and Deoiled Meals.
f) Ex - Vice-Chairman of the Vanaspati Manufacturers’ Association of India, New Delhi.
g) Have presented various Papers at International and National Forums.
h) Leader of various delegations sent broad sponsored by Central Government and various Associations for promotion of Oilseeds, Oils and Deoiled Meals export/import and trade in general from India.
i) Presently Executive Committee Member of SEA and COOIT and also Convener of Crop Estimate Committee of COOIT and SEA. 
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1. India is the 2nd largest most populous Nation, Largest democracy country with maximum young people, One of the fastest growing economy.
2. India is the largest importer of edible oils in the world. India imported 4.43 ml T of edible oils during 2001-02 and it had increased to 14.51 ml T during 2017-18. Over and above this, India imported 0.51 ml T Non-Edible Oils during 2017-18. The growth of import of edible grade Palm Oil during this period was 195% while growth in import of Soft Oils was 210%.
3. Import of Non-edible Palm Oil was 263k during 2001-02 which increased to 510k during 2017-18.
4. Consumption of Palm Oil during 2001-02 was 29.08% of all the edible oils consumed in India and it increased to 39.3% during 2017-18.
5. Demand Drivers of edible oils in India are :
a. Consistent GDP growth.
b. A big expansion in the Indian Middle class of people.
c. Double digit growth of Out of Home consumption of edible oils.
d. Per Capita consumption of edible oils in 2001-02 was 9.4 kg and it increased to 16.3 kg in 2016-17 and likely to increase to 16.8 kg in 2017-18. Still Per Capita consumption is below the threshold level of consumption. Low consuming States of Central and East India will catch up with their peers of West and North India.
e. Even with a Moderate Population growth, absolute increase in number of
people is quite high.
f. Schemes like NREGA and rising the income level of people who are consuming
much below all India level.
g. Rising urban population and many more.
6. Different Zones have different preference of edible oils :
a. Mustard Oil is Kachchi Ghani Oil with a strong pungent smell. The biggest
markets for this oil are East India followed by North India.
b. Cottonseed Oil have a largest consumption in Gujarat and Surrounding
States.
c. Sunflower Oil is preferred by affluent class of people of South and West
India.
d. Refined Soybean Oil is preferred by consumers in Madhya Pradesh,
Maharashtra and North India.
e. Palm Oil is highest selling oil in the country. This is gaining big
popularity in the Out of Home Consumption (HORECA) segment. This is the
preferred oil in South India and Coastal East India. It is gaining
popularity in West and North India also.
f. Groundnut oil, once upon a time, the most preferred oil but now slowly
dying out due to high price and low availability. The demand of Groundnut
Kernel is phenomenally growing. Hence creating a scanty of availability
of Seed for crushing.
7. There is seasonal pattern of Palm Oil consumption. During Summer period,
consumption is the highest i.e. from March to June. At higher temperature,
during these months Palm Oil does not become hazy. During Monsoon, demand is
reasonably high i.e. during July to October. During Winter, consumption is
low i.e. during Nov to Feb. As the temperature are low, Palm Oil becomes
hazy while the people prefer Oil in liquid form.
8. Out of Home Consumption (OHC) is increasing every year due to :
a. Tremendous growth in Fast Food Industry.
b. More than 80% of Urban Indians eat out several times in a month.
c. Families order Food from Outside.
d. Visitors visiting Malls end up visiting Food Court.
9. Production of Domestic Oils increased from 5.64 ml T in 2001-02 to 7.76 ml T
during 2017-18 while the consumption increased from 10.12 ml T in 2001-02 to
22.25 ml T in 2017-18. The domestic production is not catching up with the
consumption and hence there is every year increase in import of edible oils.
Dependency on import during 2001-02 was 44% which has increased to 65% in
2017-18.
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Section 1: CPO Price Trend |
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Archives |
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MITIGATING THE NEXT WAVE OF MARKET UNCERTAINTIES Nov 14, '22 ~ Nov 18, '22 |
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ASSESSING 2022: MANAGING OPPORTUNITIES AND RISKS Mar 28, '22 ~ Apr 01, '22 |
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Section 2: Opportunities for Palm Oil in Asian Market Oct 18, '21 ~ Oct 24, '21 |
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Section 1: Oils & Fats Supply, Demand and Outlook Oct 18, '21 ~ Oct 24, '21 |
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Section 1: Price Direction Apr 05, '21 ~ Apr 11, '21 |
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Section 2 : Special Focus on the US Apr 05, '21 ~ Apr 11, '21 |
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POINTERS ON THE PRICE TRENDS Jun 22, '20 ~ Jun 28, '20 |
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Section 1 : CPO Price Trend Feb 24, '20 ~ Mar 01, '20 |
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Section 2: Global Palm Oil Market Opportunities Feb 24, '20 ~ Mar 01, '20 |
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Section 2: Special Focus Aug 19, '19 ~ Aug 25, '19 |
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Section 1 : CPO Price Trend Aug 19, '19 ~ Aug 25, '19 |
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Special Focus - India Feb 25, '19 ~ Feb 24, '19 |
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Section 1: CPO Price Trend Feb 18, '19 ~ Feb 24, '19 |
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Section 2: Global Palm Oil Market Focus Aug 06, '18 ~ Aug 12, '18 |
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Section 1: CPO Price Trend Aug 06, '18 ~ Aug 12, '18 |
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Section 2 : Global Palm Oil Market Focus Jan 29, '18 ~ Feb 04, '18 |
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Section 1: CPO Price Trend Jan 29, '18 ~ Feb 04, '18 |
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Section 2: Regional Focus : CIS Countries Aug 21, '17 ~ Aug 27, '17 |
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Section 1: Palm Oil Price Fundamentals Aug 21, '17 ~ Aug 27, '17 |
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Section 2: Market Challenges and Opportunities Feb 20, '17 ~ Feb 26, '17 |
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Section 1: Price Directions Feb 20, '17 ~ Feb 26, '17 |
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Section 1 : Palm Oil Price Fundamentals Aug 22, '16 ~ Aug 28, '16 |
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Section 2 : Trade Issues and Market Prospects Aug 22, '16 ~ Aug 28, '16 |
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2016 Market Direction - Twists and Turns of Palm Oil Prices Feb 22, '16 ~ Feb 29, '16 |
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Second Half 2015 - Anticipating Market Price Direction Aug 17, '15 ~ Aug 23, '15 |
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Special Focus: Indian Sub-Continent Aug 17, '15 ~ Aug 23, '15 |
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Opportunities, Challenges And Trend In 2015 CPO Price Feb 23, '15 ~ Mar 01, '15 |
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2nd Half 2014: Market Challenges, Predictions And Directions Aug 25, '14 ~ Aug 31, '14 |
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Anticipating 2014 Palm Oil Price Direction Feb 17, '14 ~ Feb 24, '14 |
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Prospects For Second Half Of 2013 - Managing Price Fluctuations Jul 22, '13 ~ Jul 29, '13 |
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Mapping The Palm Oil Price - 2013 Market Perspective Feb 18, '13 ~ Feb 27, '13 |
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Palm Oil : Challenges, Opportunities And Latest Market Directions Aug 06, '12 ~ Aug 17, '12 |
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2012 Price Direction, Issues & Challenges Feb 13, '12 ~ Feb 20, '12 |
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Challenges, Opportunities And Latest Price Trend Aug 08, '11 ~ Aug 16, '11 |
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Challenges, Opportunities And Price Direction Feb 07, '11 ~ Feb 17, '11 |
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2010 Year End Prospects - What Lies Ahead? Aug 02, '10 ~ Aug 08, '10 |
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The higher duty impose encourages the farmer to grow more oilseeds instead of other competing crops as India is deficit in edible oils.
5 years ago
The policy makers don’t take decision on the basis of pattern of consumption of different oils. Whichever oil is comparatively cheaper, its consumption will increase.
5 years ago
The import duty on edible oils are increased by the Government of India so that the prices of domestic oils increases and the farmers get better prices for their domestic oilseeds production and are encouraged to grow more oilseeds. It is not a tool to generate fiscal revenue.
5 years ago
Thank you for sharing the insights. The available data prima facie suggests that import duties policy has limited success in encouraging higher oilseeds production. This leads one to the curious speculation if the root cause of low and inequitable income share of oilseeds farmers in fact lies in problems within the value chain. Do you agree and any further insights would be much appreciated.
5 years ago
The oilseeds production in India is not increasing to desired levels, on spite of government efforts, as 75% of the oilseeds are grown on area which do not have the irrigation facilities, hence the production of oilseeds depend on vagaries of monsoon.
5 years ago
The oilseeds production in India is not increasing to desired levels, on spite of government efforts, as 75% of the oilseeds are grown on area which do not have the irrigation facilities, hence the production of oilseeds depend on vagaries of monsoon.
5 years ago
Previously the duty difference between CPO and RBD Olein import was 10% which has been brought down recently to 5%. This will encourage more import of RBD Olein and less import of CPO. There are no default in the Trade. The refining industry is not satisfied due to recent reduction in difference between import duty on CPO and RBD Olein and has represented to the Government to increase the difference to 10% as it was prevailing previously.
5 years ago
Outlook for 2018-19 (Nov-Oct) is given in Slide No. 15.
5 years ago