Why India doesn’t need palm oil but its greener alternatives

Palm oil is water-intensive and requires large patches of land

By Bhavani R V, R S Vaidyanathan
Published: Wednesday 10 August 2022
The biodiversity-rich areas in the northeast and Andaman and Nicobar islands are now being targeted for oil palm cultivation. Photo: iStock
The biodiversity-rich areas in the northeast and Andaman and Nicobar islands are now being targeted for oil palm cultivation. Photo: iStock The biodiversity-rich areas in the northeast and Andaman and Nicobar islands are now being targeted for oil palm cultivation. Photo: iStock

India is the second-largest consumer of edible oil globally and its largest importer. While the government has taken several initiatives over the years to increase the domestic production of edible oils, its shortage and high price are often in the news.

Palm oil production grew between 2015-2016 and 2020-2021 at a compound annual growth rate of 6.1 per cent, as reported in the Economic Survey 2021-2022.

We, however, continue to import around 60 per cent of our edible oil requirement. More than half of this is palm oil, primarily from Malaysia and Indonesia, followed by soybean and sunflower oils. It is projected that the imports will continue to grow. 

Yield levels in India are usually lower than the global average. The decade of the 1980s saw a series of Technology Missions (TM) to increase productivity, including a TM on oilseeds.

Rising demand for edible oil, insufficient use of technology for optimum oil extraction and rising import bills for edible oil were among the main reasons for a TM on oilseeds.

In 1990, it became the Technology Mission on Oilseed and Pulses (TMOP). There was an increase in yield and production, improvement in extraction technology and a reduction in import bills after the inception of TMs, the National Commission on Farmers (NCF) observed.

The NCF also recommended a mini mission on trade strategy for oilseeds since the external environment is as important as the dissemination of technology.

Following the economic liberalisation policies in the 1990s, however, edible oil imports came under open general lisense and self-sufficiency in edible oil lost priority.

TMOP was eventually dissolved during the 10th Five Year Plan (2002-2007).

Oil palm started receiving special attention in the early 1990s with an oil palm development program under the TMOP. This metamorphosed into an integrated scheme on oilseeds, pulses, oil palm and maize in 2004-2005.

A special initiative was undertaken in 2011-12 under the Rashtriya Krishi Vikas Yojana for the expansion of the area under oil palm cultivation. 

The 12th Five Year Plan period saw a National Mission on Oilseeds and Oil Palm from 2014-2015 to 2017-18.

This was subsumed into the National Food Security Mission-Oilseeds and Oil Palm in 2018-2019.

A National Edible Oil Mission-Oil Palm of Rs 11,000 crore was announced last year as part of the Aatmanirbhar Bharat Abhiyan.

Around 2.8 million hectares of land have been assessed to be fit for oil palm cultivation by the reassessment committee of the Indian Council for Agricultural Research-Indian Institute of Oil Palm Research.

Of this, an additional 0.65 million hectares will be covered by 2025-2026. Some 0.325 million hectares will be in the northeast and the remaining in other parts of the country.

The mission aims to have a million hectares under oil palm in five years and guidelines for technical and monetary support have been issued. For the first time, price assurance is to be given to oil palm growers for fresh fruit bunches to protect them from fluctuations in the international price of crude palm oil.

While a mission mode approach to increase the edible oil production is welcome, the major thrust on oil palm requires careful reconsideration.

A serious stocktake of the experience is called for before the proposed large-scale promotion. So far, the experience with oil palm in different states is not satisfactory.

The crop is water-intensive and requires large patches of land. It is not clear how this will be undertaken in a scenario dominated by rainfed farming and where the majority are small farmers with less than a hectare of land.

Greener alternatives

The significant oil palm producers, Malaysia and Indonesia are experiencing biodiversity loss.

The biodiversity-rich areas in the northeast and Andaman and Nicobar islands are now being targeted for oil palm cultivation. 

We seem to be encouraging deforestation and exploitation of groundwater at a time when efforts should be in place for their conservation. It is reported that the yield per hectare of oil palm is higher than other oilseeds.

In terms of nutrition, oil from rice bran, groundnut, sunflower and oilseeds such as sesame, mustard and linseed is higher in nutrient content.

But it is also a fact that the yield from other oilseeds in India is much below the global average. Further, while four years is stated to be the gestation period for the crop, it takes about seven years to stabilise yield and produce good quality oil.

Indian farmers are familiar with the cultivation of various oilseeds and tree-borne oils such as Mohua, Karanja and linseed.

They need guidance and assured price. Cultivating sesame or mustard on a small patch of land for the household requirement is an age-old practice of our farmers.

Mustard and its variant rapeseed are less water-intensive and can produce output without any gestation period.

Groundnut, soybean, sunflower seed, sesamum, niger seed, rapeseed, mustard, safflower and copra are the oilseeds among the 22 mandated crops for which minimum support price (MSP) is announced by the government. But more often, they are sold at a price below the MSP.

Further, given that paddy is a major cereal crop, oil extraction from rice bran must be fully exploited. With proper planning, we can address technical glitches in the supply chain.

Milling of paddy produces rice, husk and bran. The husk can be used as a fuel for generating steam.

Rice bran has 18 to 20 per cent oil content that can be extracted and processed as edible oil. The oil contains oryzanol which is very good for metabolism.

Rice bran deteriorates fast, with the oil increasing in free fatty acid content quickly, affecting the processing and edibility of the oil.

This can be resolved by stabilising the bran through heat treatment. The technology is available and millers can be incentivised to establish small bran stabilising units.

The husk produced during milling can be used for generating steam in boilers for the stabilising unit.

The bran must then be transported quickly to solvent extraction plants for oil extraction. The logistics for the location of the solvent extraction plants and transport of bran have to be worked out.

The de-oiled bran is a good fertiliser and also has an export market. A cooperative effort on the lines of the Amul Dairy model, where the farmer is an active participant, can lead to the mushrooming of rice bran oil solvent extraction plants in paddy-growing clusters across the country.

Measures should also be taken to bring more area under mustard and rapeseed cultivation in the rabi season. Small farmers need support, guidance, assured price and procurement, backed by strengthening of oil processing facilities.

The support required will be much less than the investment planned in oil palm cultivation and results will be forthcoming almost immediately.

Views expressed are the authors’ own and don’t necessarily reflect those of Down To Earth

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