India's edible oil market crossed Rs 1.3 trillion mark in 2017: Research

Health-conscious Indians are driving the sale of branded edible oil, ditching ‘loose oil’ sold by the neighbourhood grocery store.

According to data from market research firm Euromonitor International, the edible oil category, which had overtaken dairy to become the largest packaged food segment a few years ago, grew 25.6 per cent to cross the Rs 1.3 trillion mark in 2017. This is the first time any packaged food category has crossed the Rs 1.3 trillion mark.

Diary was the second largest with Rs 1.2 trillion, 16.5 per cent higher than 2016.

The packaged food market, including rice, pasta and noodles, stood at around Rs 378 billion last year, growing 23.6 per cent year on year, thanks to the downside risks associated with these kinds of foods.

In fact, edible oil formed over 30 per cent of the Rs 4.34 trillion packaged foods market in India, compared to the 8.8 per cent share held by rice, pasta and noodles.

“Growth is primarily coming from new consumers, who are shifting from loose to packaged oils”, said Atul Chaturvedi, chief executive officer, Adani Wilmar, the company that sells a number of edible oil brands.

“Packaged oil sales are growing at 2.5 times the rate of overall edible oil consumption in India. Increasing awareness for safe products, the food law administration restricting loose product sale and the crackdown by the government on unfair trade practices aided this growth,” said Deoki Muchhal, managing director of Cargill’s food business in India.

According to Euromonitor, the rice, pasta and noodles category will grow faster than others till 2022 with a 12 per cent cumulative average growth rate, followed by breakfast cereals (10.6 per cent). Edible oil, though, is expected to maintain a healthy rate of 9 per cent.