Leading executives from prominent fast-moving consumer goods (FMCG) companies in India have reassured consumers that edible oil prices are expected to remain stable during the forthcoming festive season. This assurance is primarily attributed to a robust international supply chain. However, concerns are arising regarding potential price hikes from December through April-May next year as the impact of El Nino in oil-producing nations begins to affect global markets.
Despite reports of severe moisture stress affecting the soya bean crop in India, FMCG industry leaders have stated that prices of edible oils are unlikely to see an immediate rise due to favourable international supply conditions. The Indian consumer can thus anticipate price stability during the festive season.
Nonetheless, FMCG companies are closely monitoring the situation regarding rice production in the country. Several eastern states, which are major producers of non-basmati rice, have experienced insufficient rainfall, potentially endangering the standing paddy crop in fields. BV Mehta, Executive Director of the Solvent Extractors Association, emphasized the critical role of the monsoon in soy bean and groundnut crops, expressing concerns about the potential impact on yields should the rainfall remain inadequate.
According to the India Meteorological Department, 287 out of 717 districts in the country have faced a rainfall deficit between June 1 and August 4. While the supply of imported oil in India remains substantial, experts warn that the scanty monsoon may indeed influence the soy bean crop, potentially affecting consumption patterns.
Angshu Mallick, Managing Director of Adani Wilmar, emphasized, “India is sitting on a good volume of imported oil, and prices are unlikely to go up soon. But definitely, the scanty monsoon will have an impact on the soy bean crop. That may have an impact on consumption.”
Consumers and industry stakeholders will be closely watching developments in the edible oil and agriculture sectors as the festive season approaches and as the repercussions of El Nino become more apparent in the oil-producing nations.