Anand Kumar Dahiya, Journal of Management Research and Analysis (JMRA) Available online at http://jmraonline.com ISSN: 2394-2770, Impact Factor: 4.878, Volume 05 Issue 02(1), June 2018, Pages: 82-89 Homepage: http://jmraonline.com, Email: jmraeditor@gmail.com Page 82 CHALLENGES AND OPPORTUNITIES OF OIL MILL INDUSTRY IN HARYANA 1 Anand Kumar Dahiya 1 (Phd Scholar GJU S&T Hisar) 1.1 INTRODUCTION Profile of Edible Oil Sector in India Indian edible oil industry holds an important place in Indian economy. India is one of the largest producers of oil seeds in the world and oil consumption forms an integral part of the household food expenditure. Currently, India accounts for 11.2 per cent of vegetable oil import and 9.3 per cent of edible oil consumption. 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. The Indian edible oil industry is highly fragmented with palm oil (approximately 54%), soya bean oil (around 17%) and mustard oil (about 13%) contributing majorly. The sector is largely dominated by the bulk segment. Unbranded segment accounts to 75–80% of the total consumption. It is composed of approximately 15,000 oil mills, 600 solvent extraction units, 250 vanaspati manufacturing units and about 400 refining units. Table 1.1: Edible Oil Scenario in India Edible oil scenario in India (million tonnes) Particulars 2009-10 2010-11 2011-12 2012-13 2013-14(F) Oilseed production 32.9 35.7 36.3 36.8 38 Oilseeds crushed 25.1 29.1 28.9 29.2 29.4 Crushed (%) 76.3 81.7 79.4 79.3 77.6 Edible oil production 7.8 8.5 8.1 7.5 7.6 Imports 9.2 8.7 10.1 10.7 11.8 Total supplies 17 17.2 18.2 18.1 19.4 Domestic consumption 15.2 15.7 16.7 17.4 18.1 Import share 60.8 55.2 60.5 61.2 65.3 Source: India Ratings 2015 1.1.2 Edible Oil Market in India Edible oil sector is one of the most important sectors of agriculture industry in India. India is a leading player in the sector, the world’s largest importer and third-largest consumer. India is the fourth-largest oil seed producing country in the world, next to USA, China and Brazil. There are nine types of oilseeds that are produced in India. Soya bean, ground nut, and mustard are the major oilseeds produced in the country. According to the recent study, vegetable oil consumption has increased following a rise in household incomes and consumer demand. India imports half of its edible oil requirement, making it the world’s third -largest importer of edible oil (Ambukashi, 2016). India’s vegetable oil consumption for kitchen is likely to increase to 18.1 million tonnes for the oil year 2013-14 (November–October) as compared to 17.4 million tonnes in 2012- 13 of which import share to remain at 65% in the current year versus 61% in the previous year (India Ratings, 2015). The market size of Indian edible oil industry was Indian national rupee (INR) 1,000 billion with a consumption of 17.34 million tonne in FY 2012—13. According to a report by India Rating, Indian edible oil industry is set to attract fresh capital investment of Rs 450 crore in the financial year 2014-15 as compared to Rs 100.7 crore in the previous financial year and Rs 516 crore in 2012-13. Margins for Indian veg oil refineries have improved in the last three months. According to industry estimates, refineries generate profits of Rs 2-3 a kg on refining CPO currently from around Re 1 loss few months ago. Consequently, refining units have increased import of crude palm oil (CPO). In fact, import of CPO in April 2014 shot up to contribute 90 percent as compared to 76% in January when refinery margins were in contraction. The trend is likely to continue in future as well. Data compiled by the apex trade body the Solvent Extractors’ Association (SEA) showed India’s vegetable oil import 832,760 tonnes, 27% rise from April 2013 and 8% decline from January this year.