COVID-19 lockdown boosted sales of branded cooking oil

The COVID-19 pandemic driven lockdown helped boost the sale of branded cooking oil by 30 per cent year-on-year between April and December. With restaurants and hotels closed, the in-home usage moved consumption to soft cooking oils with the likes of soybean, sunflower and groundnut etc.

Piyush Patnaik, managing director at Cargill’s oil business in India, said that there is a clear shift towards in-home consumption over the last 10 months. He said this trend is going to continue in the coming quarters. “In larger cities, we could see the shift to higher health and wellness products and in other oils to larger pack sizes. Sales to consumers is over 80 per cent of the company’s branded oils portfolio.”

Patnaik said that with the revival in the packaged food industry demands, the company is seeing return of strong demand in its B2B business. Cargill’s Gemini and Nature Fresh brand of cooking oils have both recorded significant penetration gains in all markets across India.

Akshay D’Souza, Chief Marketing Officer at Bizom, pointed out that Indians are now consuming branded edible oils much more than ever. “With celebrities promoting the various benefits of cooking oils, it is only natural that we are seeing a surge in the movement of consumer preference towards branded edible oils,” he said. “As hotel, restaurants and cafe usage has been muted since the lockdown, we have seen consumption of edible oils increase significantly from home use.”

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Bizom shows that in the first quarter of the current financial year, cooking oils recorded sales growth of 31 per cent year-on-year, sales surged to 34.9 per cent in the second quarter, while setting in at 21.1 per cent in the December quarter. D’Souza said this signals consumption moving from unbranded oils to the perceived safer branded edible oils.

Saugata Gupta, MD and CEO Marico Limited, said the company is anticipating sustained growth for the portfolio going forward, even as post-COVID consumption patterns normalize. Marico, the company which sells the popular Saffola brand, recorded a 17 per cent volume growth in the December quarter. It highlighted that close to 65 per cent of the growth was driven by increase in overall penetration. “Increased household penetration and relevance of healthy cooking continued to lend impetus to the franchise,” Gupta said. “We believe the brand can continue to grow in a high single digit over a medium term as a base case.”