The fear of contracting the virus is keeping most Indians away from dining out, still. In November, The Federation of Hotel and Restaurant Associations of India said that the industry has only recovered by 20-30% of the average pre-Covid level. Consumers instead are dabbling in recreating ‘restaurant-like’ food at home. And one of the beneficiaries of this trend is the olive oil industry — some of these brands have recorded 15-35% growth in home consumption between July to November, 2020.
Pegged at Rs 1,050 crore in 2020, according to Euromonitor International, olive oil accounts for barely 0.6% of the edible oil market in India. As per the Indian Olive Association, India consumes about 12,000 metric tonnes of olive oil annually. In 2010, India imported only 3,373 metric tonnes of olive oil; but for the last five years, it has been importing about 11,000 to 12,000 metric tonnes annually.
Brands are hoping that the shift in consumer priorities towards home-cooked meals and healthy eating habits will give a fillip to this market in India.
Bon appétit (at home)
Olive oil, typically consumed out of home by Indians, has an aspirational flavour and is usually used in gourmet preparations. “At-home consumption is driving the retail sale of premium oils such as virgin olive oil and extra light olive oil,” says Yogesh Bellani, CEO and director, FieldFresh Foods, which owns the Del Monte brand. Del Monte and Oleev have seen a 30% increase in sales, while Cargill’s Leonardo brand of olive oil has grown by 15-20% y-o-y since July, 2020.
The increase in sales is not limited to the metros and urban centres alone, the brand owners say. “The move to e-commerce has helped with deeper penetration. We are seeing greater participation from tier II and III cities in states such as Gujarat and Punjab,” Bellani adds.
Piyush Patnaik, MD, Cargill, which owns brands like Gemini and Leonardo, says that in small cities, retailers do stock olive oil on shelves. “They mainly stock small SKUs and large packs are meant for the niche clientele,” he adds.
Akshay Modi, director, Modi Naturals, which sells olive oil under the Oleev brand name, and VP of Indian Olive Association, estimates that the surge in home cooking since March has led to an increase in the sales of olive oil — about 15-20% in the metros and 50-60% in tier II and III cities.
The price barrier
The steep pricing of olive oil has always come in the way of it becoming a popular choice among Indian customers. Patnaik says that despite being known for its health benefits, olive oil is largely seen as ‘the rich man’s oil’. As per a Mintel consumer study, 77% of Indian consumers feel that healthy food is expensive to buy on a regular basis.
Olive oil loses out in the volume game even if awareness may have increased. “A large number of consumers who use olive oil, use it mainly to garnish salads or prepare a specific type of food. It is still not the main oil used for everyday cooking by those who buy it often,” says Subhendu Roy, partner, Kearney.
Nidhi Sinha, content head, Mintel India, points out that because Indians use a range of oils with strong flavours, such as mustard oil in the east of India and coconut oil in Kerala, not all consumers would prefer to move to an expensive oil that does not match their palate.
The industry is working on educating consumers about using olive oil for everyday cooking. In the last several months, brands like Del Monte and Oleev tied up with chefs and food bloggers to create cooking videos and related content.
Oleev sells blended olive oil in addition to the typical olive oil variations. Modi says consumers buy five-litre packs of blended oil for everyday use, and small SKUs of 500 ml of its premium oils such as virgin olive oil. One litre of virgin or extra light olive oil costs about Rs 600-700; whereas a five-litre can of blended oil (rice bran oil + olive oil) sold by Oleev costs Rs 995.
To up its accessibility, Del Monte has introduced pomace olive oil, which can be used for deep frying and everyday Indian cooking, in a pouch for Rs 250 per litre in Delhi and Bengaluru.
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