Household demand and supply projections of major edible oils in Tamil Nadu State, India

Abstract

This paper analysed the household demand, projected the supply and assessed the domestic demand-supply gap of edible oils consumed in Tamil Nadu State, India. The primary data were collected from randomly selected 1000 sample households at Tamil Nadu collected during the year 2009-10. The growth rate, AIDS model and supply projection techniques were employed to derive appropriate conclusions. The area under groundnut and sesame crop was found declining over years in Tamil Nadu. The sunflower area was also declining, but, the yield showed increasing trend implying the production growth mainly driven by yield. Unlike other oilseed crops, the coconut production was driven by area rather than productivity. The results of demand estimation revealed that about 66% increase in demand is expected by 2020 for groundnut oil whereasthe demand forsesame, coconut and other edible oils would increase by 67%, 66% and 78%, respectively in Tamil Nadu. Among all major edible oils,sunflower oil's demand was the highest followed by groundnut, palm, sesame and coconut oil. It is projected that there will be leapfrog jump in sunflower oil demand in the coming years, mainly due to increased awareness about low-saturated fat content in this oil. The total edible oil demand would increase from 6.38 lakh tonnes to 10.75 lakh tonnes by 2020. The resultsfrom thisstudy also revealed that, the groundnut oil and sesame oilsupply available from the state sources would decline and widen the production-household demand gap. Hence, urgent policy measures have to be initiated to increase the current level of production in these crops.