Indian vegetable oil is world's fourth largest after USA, China and Brazil.
Oilseed cultivation is undertaken across the country in two seasons, in about 26 million hectares; mainly on marginal lands, dependent on monsoon rains (un-irrigated) and with low levels of input usage.
Yields are rather low at less than one ton per hectare.
Currently, India accounts for 7.0% of world oilseeds output; 7.0% of world oil meal production; 6.0% of world oil meal export; 6.0% of world veg. oil production; 14% of world veg. oil import; and 10 % of the world edible oil consumption
With steady growth in population and personal income, Indian per capita consumption of edible oil has been growing steadily.
However, oilseeds output and in turn, vegetable oil production have been trailing consumption growth, necessitating imports to meet supply shortfall.
The per capita consumption of oil in India is 11.5 kg/year is way below the world average of 18 kg. Even china is at 17 kg. By 2010 the per capita consumption of oil in India is likely to be 15.6 kg. There is huge potential of growth.
The demand for edible oils is expected to increase from Oil Year 2004-05 levels of 10.9 Mln. tonnes to 12.3 Mln. tonnes by 2006-07 (two years). This assumes a per capita consumption increase of 4% and a population growth of 1.9% which translates to an overall growth in demand @ 6% p.a. Based on the above assumptions, edible oil demand in the year 2015 is expected to be 21.3 million tonnes.
Demand Projection Edible Oil 2004 2010 2015 Total Demand (Mln. Tonnes) 10.9 15.6 21.3 Total Area under Oilseeds (Mln. Hectares) 23.4 28 32 Yield (Tonnes/hectare) 1.07 1.2 1.4 Production of Oilseeds (Mln. tonnes) 25.1 33.6 44.8 Domestic supply of edible oils (Mln. tonnes) 7 10.1 13.4 Total edible oil imports - (Mln. tonnes) 4.3 5.9 8.3 Imports as share of demand 39.40% 38.10% 39.50%
India will continue dependence on imports to the extent of 40% of its consumption requirements. The improvement in yields and the increase in area under cultivation will ensure that the domestic oilseed production is sufficient to meet 60% of consumption requirements.