Edible Oil Scenario in India

Topics: Soybean, Vegetable fats and oils, Soybean oil Pages: 9 (2842 words) Published: December 14, 2007
Report on GPDP Project in Edible Oil Industry in India
Chapter 1.0: Introduction
India is the fourth largest oilseed producing country in the world, next only to USA, China and Brazil, harvesting about 25 million tons of oilseeds against the world production of 250 million tons per annum. Since 1995, Indian share in world production of oilseeds has been around 10 percent. Although, India is a major producer of oilseeds, per capita oil consumption in India is only 10.6 kg/annum which is low compared to 12.5 kg/annum in China, 20.8 kg/annum in Japan, 21.3 kg/annum in Brazil and 48.0 kg/annum in USA. Many varieties of oilseeds along with tree origin oilseeds are cultivated in India. Among these, the major oilseeds are Soybean, Cottonseed, Groundnut, Sunflower, Rapeseed, Sesame seed, Copra, Linseed, Castor seed and Palm Kernels. India occupies the place of pride as the world's largest producer of Groundnuts, Sesame seeds, Linseeds and Castor seeds. In India, oilseeds are grown in an area of nearly 27 million hectares across the length and breadth of the country. Depending on the period of cultivation, the oilseeds are classified as 'Kharif Crop' and 'Rabi Crop'. The Kharif Crop that is dependent on the Monsoon is harvested around October-November each year. On the other hand, the Rabi Crop is harvested around March-April each year. The edible oil industry of the country comprises of 50,000 Expellers, 600 Solvent Extraction Plants, 300 Vegetable Oil Refineries, and 175 Hydrogenation Plants. The edible oil sector occupies a distinct position in Indian economy as it provides job to millions of people, achieves on an average a domestic turn over of US $ 10 Billion per annum and earns foreign exchange of US $ 90 Million per annum. According to an estimate by National Council of Applied Economic Research (NCAER), in the year 2000-2001, the demand for edible oil was projected at 10 million tons against the domestic production of 6.7-7.0 million tons. The short fall of 3.0- 3.3 million tons was expected to be met by importing edible oil in India. It is predicted by NCAER that in the year 2015, the demand for edible oil in India would be 20 million tons per annum. Considering the present domestic edible oil supply of 7 million tons per annum, a shortfall of 13 million tons per annum is envisaged in the year 2015. To bridge this gap, a growth rate of 15 % per annum would be required in edible oil production in the country. Currently, edible oil growth rate in India is only 4%. In the event of failure to achieve the required growth rate, India would continue to spend huge foreign exchange on import of edible oil. The annual production figures for domestic oil seed & edible along with the figures of import of edible oil over last 8 years are illustrated by a bar chart at Figure-1.1. National Productivity Council, New Delhi (India Page 1. . 1

Report on GPDP Project in Edible Oil Industry in India
Domestic Oilseed & Edible Oil Production Vis-a-vis Import of Edible Oils215213.4221.1243.8213.2252.1216.218569.371.972.274.267.969.162.7553.31014.817.520.843.944.5520501001502002503001993 - 941994 - 951995 - 961996 - 971997 - 981998 - 991999 - 20002000 - 2001In Lakh TonnesOilseeds ProductionProduction of Veg. OilImport of Edible oil Figure-1.1: Bar chart showing domestic production of oil seeds and edible oil vis-a-vis import of edible oil during last 8 years 1.2 SOY OIL SECTOR IN INDIA

India is the fifth largest producer of Soybean in the world. However, India's share in world production of Soybean is only 3% (Figure-1.2). Soybean is the third largest oilseed crop in India next only to Groundnut & Mustard. It accounts for 25 per cent of total oilseeds (25 million tons) produced in the country in a year. It contributes about 0.7 million tons of oil out of about 7 million tons of vegetable oils currently produced in the country. National Productivity Council, New Delhi (India Page 1. . 2...
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