Mumbai: For 2016-formed Canadian Agro India, 2017-18 was packed with a lot of surprises. After witnessing a good amount of growth in 2016-17, the company saw a slump in their major and only product sold by the company in India—Canola oil. This drop in the Canola oil market was due to negative reports about the oil. But Canadian Agro India believes the demand has started to pick up.
While speaking to Free Press Journal, Canadian Agro India, CEO, Namankumar Jain said, “The market was growing good. The quality of Canadian Canola oil is of high-quality so our products were priced slightly higher. But we still have and had takers. But post the negative research by Temple University which was carried by all the leading media houses in India, there was a decline in sales. People who placed the order started cancelling.” The research stated that Canola oil can worsened memory, decrease learning ability and increase weight gain in Alzheimer’s disease.
The industry has been growing for last one and half year for this oil, stated Jain. There has been competition coming from companies getting oil from UAE, Ukraine and Australia. After negative publicity of Canola oil, Jain believes competitors should come together to build a different image of the oil. This is critical for the industry, he opined.
Jain pointed out one should look at the efforts taken by Olive oil companies to change the mindset among Indians about the oil. Canadian Agro India has contacted Export Development Canada (EDC), Canola Council of Canada (CCC) and Trade Commission in order to find a solution to their on-going problems around the oil. Jain is hoping to raise these concerns to Prime Minister Justin Trudeau and his trade council informally during his visit to Mumbai.
With strong presence in states like Punjab, Haryana, Uttar Pradesh and New Delhi, Jain is optimistic of gaining the lot ground. Many retail outlets in India stopped selling Canola oil but the company were able to get their product through small stores (Kirana stores). “These small stores across various states are driving our growth.” The company also has presence in Rajasthan, Maharashtra, Gujarat etc as well. “We are facing problem in South but we will look at those markets too.” At one point of time, the company was able to partner with around 2, 50,000 retailers but now this number has dropped, Jain stated. The company is now relying not only on retail consumers but also on institutional customers like restaurants.
Apart from Canola oil, the company had plans to test Indian market for Canadian pulses. But due to ample rainfall and good crops this year, there was a fall in prices of grains/pulses and increase in import duty. This cost the company dearly as it had already imported 250 metric tonnes. However, Jain is quite optimistic that there will be next time for Canadian pulses in India. “As a new entrant, such market rates and import duty can hurt businesses dearly.” But Jain expects the import duty to come down depending on the market needs. In the past, the Indian government had exempted pulses imported from Canada, France, and the US from mandatory fumigation at port of origin. But now it has been allowed by the Indian Government.
The company, which is also into dairy imports, is not eyeing Indian market for dairy products. But if in the future, the company wants to import them to India, it would clearly be value-added products, Jain added.
Canadian Agro India, gets Canola oil from Canada and bottles them in India, has invested USD 1 million in India in a period of a year or two. The company plans to further invest around USD 1 million in marketing and other activities in times to come. After being activity on social media post drop in the sales, the company is planning to get back into aggressive marketing mode by April 2018.