Myth-busting about Palm Oil

Its been a lot of time since i wrote last about Palm Oil, After that lots of events happened, The Covid-19, The Fallen Economy, The Dipping GDP, Lock down and much more.

On 13th November 2020, I attended an online webinar DISPELLING MYTHS ABOUT PALM OIL which was organised  my Malaysian Palm Oil Council (MPOC) where Ms Bhavna Shah (Country Representative Malaysian Palm Oil Council – India and Sri-Lanka) gave us some clarity about the myths going around regarding Palm Oil.

Earlier, i wrote about the benefits of Palm Oil and i am not writing about the same today.

Today i will be writing about the Myths going on regarding the Palm Oil in our country. But me first share the Impact of Covid-19 on Palm Oil.

Why The Edible Oils Saw A Dip In The Market?

Covid-19 have definitely affected almost everything in our daily life and also we see the effect on palm oil, 

The lockdown affected the restaurants a lot. Even when a lot of restrictions were already lifted, restaurants faced a lot of hardships. Till the very end the restaurants were closed.As the restaurants and hotels were closed, there was a decrease in consumption of almost 40 percent.

The lengthy lockout time developed an immense shadow on edible oils. In normal times, the consumption of vegetable oils in India was about 2 million metric tonnes per month. The effect of the lockout, however, is such that the monthly offtake has plunged to between 1.20 and 1.30 MMT. This is a very sharp dip when we talk about in numbers.

At the time of lock down there was not just closure, there was even shortage of goods of which the Edible oils were a part off. Processing units were working with less staff, the transport and freight was hit badly, In simple words due to various reasons the demand and supply both were affected.

Talking about the palm oil, In 2019, the average monthly imports were about 800,000 MT and in March 2020 it was below 350,000 MT. 

Even if these Edible oils were under the essential goods category, the transport and travel restrictions made it difficult for the oil sector to provide supply.

But Why Palm Oil Was Affected More?

• The Sector consuming 40% of palm oil was closed.
• Indian Import Licences for RBD Palm Products Suspended.
• Myths started spreading regarding palm oil.

Palm oil was always surrounded by myths and rumors about it. Plus when the consumption of cooking oil is reduced, more rumors and myths started about Palm Oil.

Both supply and demand for the cooking oil was disturbed during the lock down, the supply faced a lot of issues even if exemption was granted for cooking oil, practical difficulties arise, limiting the movement of such goods, leading to difficulties for producers. They are faced with issues of labour availability for such activities. For fear of being harassed on the way to work, Labour isn't willing to go to work. There have been instances of individuals being stopped and taken to task at road blocks. In addition, they also face problems with the lack of transport to travel to and from work. Most of these activities are all labour intensive, such as packaging of goods, loading and movement. While raw materials are available for production, such shortages of labour may force some of the major importers of vegetable oils and producers of cooking oils to cease operations.

Problems started for Palm Oil even before lock down.

Palm Oil imports into India from Malaysia were affected at the start of the new year with the announcement by the Government of India about a change in the open import policy to restrict import of refined palm oil. Where as the crude form of palm oil could be imported freely, but restrictions on the refined variety were there. The new import policy has been seen as an unofficial restriction on Malaysian imports. At the same time edible oil prices fell by 10 percent. Crude palm oil prices in Malaysia and Indonesia plunged by 18 percent. Because of the coronavirus outbreak in China, the supply of palm oil has stuttered. 

It's possible result:-

Either domestic oils or imported soya or sunflower oils may replace Palm Oil.

Even the criteria for packaging is being changed. With the slump in institutional market, the demand for oil to be packaged in tins has been reduced. The preference of the retail client is for pouches and other manageable packaging for the household.

Why there has been a dip in the consumption?

On account of the lockdown, there has been a massive effect on demand for Palm Oil. The main user of Palm Oil is the Hotel and Restaurant market. The use of Palm Oil has fallen considerably as the biscuit industry, candy makers and bakeries are almost non-functional. Even if in some parts of India the primary means of cooking in households is palm oil, The amount of consumption, however has decreased.

Industrial usage-

Palm oil is in almost 50% of the packaged products that we buy in stores, from cookies, doughnuts and candy to deodorant, perfume, toothpaste and lipstick. Palm oil is used in many ready-to-eat foods.

So the main sector using the larger quantities of palm oil is the industrial as well as the food sector, both of these sectors were facing lots of problems and restrictions in the lock down period. Its consumption shifted from around 2 million metric tonnes  to  1.20 to 1.30 million metric tonnes during the lockdown.

Domestic usage-

The most common thing in our household is the use of edible oil. As part of our monthly shopping list, wealthy parts of society buy this product in bulk. This transaction takes place in convenient 1⁄2 kg packages and other higher bulk weights. Yet a substantial number are unable to afford bulk sales. The purchase by this layer of society of edible oil is in limited amounts and palm oil is not available in pre-packaged micro and small quantity packets.

Rise of Myths

As the demand was reduced several myths regarding palm oil started.

Mostly they were regarding the Quality, the nutritional value, the purity etc.

As the Palm Oil is not available in much smaller quantities, loose oil continues to be marketed.

The selling of loose oil entails risks. The customer may not get the right quantity for which they pay. There's even a possibility of adulteration. Some traders mix the low and high priced oil and sell it as high priced one.

Myths regarding to Palm Oil Causing Deforestation:-

Palm oil is an incredibly efficient crop which produces more oil per land area than any other vegetable oil equivalent crop. Globally, palm oil occupies only 10 percent of the land with 35 percent of the world's vegetable oil market.

We would need somewhere between 4 and 10 times more ground to get the same amount of alternate oils like soybean or coconut oil, which would just move the issue to other parts of the world and threaten other ecosystems and animals.

Seeing the devastation caused, your first reaction may be to completely cut out the palm oil. But in reality the hunt for an answer could make things worse. Palm oil is so effective that it would require up to 10 times as much land to grow using an alternative oil.

Myths regarding ill effects on health:-

From a very long time myths saying Palm oil as an unhealthy oil were been spread. But the reality is just opposite. Palm oil is full of nutritional values.

Palm oil is naturally free of harmful trans–fatty acids.

It is a natural carotenoid & vitamin E source and provides fatty acids as well as other essential micro nutrients that are fat-soluble. It also offers an abundance of calories that give us much-needed energy for our everyday lives. Due to the high content of carotene, the oil is bright orange-red in its pure form.

So these were the myths going on about palm oil and it was really important to know the truth about these myths.

For more information about palm oil, please visit www.mpoc.org.in