Patanjali reveals plans to ramp up palm oil production in Northeast

Pankhi Sarma

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Assam's Industrial Development Corporation has allocated 15 hectares of land to Patanjali in Dhing, Nagaon, for a proposed oil mill, expected to be commercialized by 2026

Guwahati: A palm oil processing mill in Pasighat, Arunachal Pradesh, by June or July this year; fifteen hectares of land in Dhing, Nagaon, for a proposed oil mill. These are some of the projects that Patanjali Ayurved, one of India's leading FMCG brands, is envisaging in the Northeast, Business North East has learned.

Despite opposition from many corners, New Delhi is pressing ahead with its centrally sponsored 'National Mission on Edible Oils—Oil Palm' scheme with a special focus on the Northeast, and the Baba Ramdev-fronted company is expected to play a key role in this mission.

In an interview with Business North East, Ashok Kumar Singh, the Chief General Manager for factories and Head (Palm Oil) in Patanjali's Northeast unit, shed light on the palm oil production in NE and how the conglomerate is working for its expansion.

Ashok Kumar Singh, Chief General Manager for factories
and Head (Palm Oil) in Patanjali's Northeast

"Around 30 palm oil nurseries have been established, each capable of accommodating one lakh sprouts or seedlings", he said. "These hybrid seeds are sourced from Malaysia and Indonesia, with each nursery requiring an investment of approximately Rs 2 crore."

Patanjali Foods Ltd (PFL) has entered into agreements with the governments of Assam, Mizoram, Arunachal Pradesh, Nagaland, and Tripura to promote oil palm cultivation under the NMEO-OP initiative. 

It has strategically allocated districts across the Northeastern states for its transformative palm oil cultivation initiative. In Arunachal Pradesh, the designated districts include Lohit, Namsai, East Siang, Pakke-Kessang, Papumpare, Changlang, Tirap, Kamle, and Lower Siang.

Assam's palm oil cultivation efforts are concentrated in districts such as Tinsukia, Dibrugarh, Jorhat, Golaghat, Nagoan, Kamrup, and Goalpara.

Mizoram's participation in the initiative includes districts like Lunglei and Lawngtlai, while Nagaland's involvement extends to districts like Mokokchung, Longleng, and Mon. In Tripura, Patanjali has identified West Tripura, Khowai, Sepahijala, Gomati, and South Tripura districts for its palm oil cultivation endeavors. 

This year, Patanjali Foods Limited has plans to plant palm oil across 30,000 hectares (approx) in the Northeast. "We are aiming to allocate around 10,000 hectares in Assam, 9,000 hectares in Arunachal Pradesh, 2,000 hectares in Mizoram, 1,500 hectares in Tripura, and 500 hectares in Nagaland for the palm oil plantation," Singh said.

With the establishment of 30 high-tech nurseries and the distribution of 30,00,000 oil palm seedlings, it is projected that approximately 25,000 to 30,000 hectares will be covered under oil palm cultivation during the fiscal year 2024–25 in the Northeast, added Singh, adding that the investment in all nurseries amounts to Rs 50–60 crores.

Sharing about further plans, he said, "A palm oil processing mill is currently undergoing commissioning in Pasighat, Arunachal Pradesh, boasting a capacity of 5 TMPH (tons per hour), and will commence operations by June–July 2024, backed by an investment of approximately Rs 30 crore. Additionally, another palm oil factory is slated for establishment by 2026 in Mizoram, with a capacity of 5 tons."

In the interim, the land acquisition process has been finalized in Assam and Mizoram, paving the way for the company to expedite the construction of the factory in Mizoram. 

Furthermore, the Assam Industrial Development Corporation has allocated 15 hectares of land in Dhing, Nagaon, for a proposed oil mill, expected to be commercialized by 2026, Singh added.

The introduction of palm oil cultivation is poised to be a transformative force in the Northeast. Through continuous awareness campaigns and engagement with farmers, there has been a notable increase in interest among farmers in palm oil cultivation, Singh said. "To date, Patanjali has covered approximately 12,500 hectares of oil palm plantations in the Northeastern states, benefiting around 5,000 farm families associated with Patanjali," he added.

It is worth noting that India's import of palm oil surged to 134 lakh tons in the fiscal year 2019–2020, while domestic production stood at 106.55 tons. In the fiscal year 2020-2021, India's import of edible oils totaled approximately 133.52 lakh metric tons, amounting to Rs 80,000 crore. Palm oil constituted the majority share at 56%, followed by soybean oil at 27%, and sunflower oil at 16%. This surge in consumption, from 15.8 kg per person per year in 2012–13 to around 19.00 kg at present,.

With the company providing seeds to farmers at zero cost, coupled with the prospect of earning revenue through the sale of Fresh Fruit Bunches (FFB) after four years, palm oil cultivation will emerge as a potential opportunity for farmers, Singh explained.

Oil palm is a perennial crop with an economic cropping period of 25–30 years, requiring less labor (1 laborer per 5 hectares of land) and minimal pesticide usage due to low pest and disease infestation. Palm oil cultivation requires an annual consumption of 67.35 lakh liters of water per hectare.

"However, to meet the growing consumption demands, it is imperative to ramp up mass cultivation efforts for palm oil,"  Singh said. The pricing of FFB is regulated by the central bank and allocated to the respective states, a rate subject to fluctuations over time, he added.

According to the Patanjali official, palm oil cultivation will boost local farmers' income and the state's per capita income, drive industrialization in the edible oil sector, create jobs for youth, ensure a steady edible oil supply, and increase state revenue. "Additionally, it will provide year-round employment for rural communities, diversify crop options, enhance productivity, and generate extra income through mixed farming, reducing losses from crop failures caused by weather," he added.

Farmers benefit from an available market for their produce, with collection centers provided for FFBs, eliminating the need for intermediaries. Patanjali also offers a buy-back agreement, and procurement prices are determined by the government every month (Global MSP), ensuring year-round assured income for farmers. The Department of Agriculture also provides subsidies for various aspects of oil palm cultivation under the NMEO-OP scheme, including seedlings, crop maintenance, intercropping, drip irrigation, tools and implements, vermicomposting, and fencing, along with free technical advice and support from experts.

With farmers expected to earn an income ranging from Rs 4 to 5 lakh per hectare, this can be proven as a potential sector for the region's economic growth, according to Singh.

Furthermore, palm oil cultivation allows for intercropping with various crops such as ginger, chili, tea, and banana, presenting additional income opportunities for farmers, he added. It also requires fewer pesticides and fertilizers compared to other vegetable oil crops, and plantations can be established on degraded land without resorting to deforestation, Singh shared.

With superior planting materials, Singh said, efficient irrigation, and effective management practices, oil palm cultivation can yield between 20 to 35 metric tons of FFB per hectare. "In comparison to traditional oilseeds, palm oil boasts a yield that is five times higher, presenting a significant advantage."

Particularly noteworthy is that oil palm cultivation requires significantly less land than other oil crops. "For instance, to produce one metric ton of major oil types: palm oil requires approximately 0.26 hectares, while rapeseed oil needs 1.25 hectares, sunflower oil requires 1.43 hectares, and soybean oil demands around 2 hectares," Singh told Business North East.

Palm oil finds application in a multitude of industries, including food, skincare products, and cosmetics, with its usage steadily increasing. 

Looking ahead, Singh further speaks, with 22 manufacturing units boasting a combined refining capacity exceeding 11,000 tonnes per day and a packaging capacity of 10,000 tonnes per day, Patanjali has exclusive procurement rights to over two lakh hectares of land across India, suitable for palm oil cultivation. The company has a presence in palm oil cultivation across 12 states, with over 1 lakh farm families now engaged in oil palm cultivation.

Patanjali is investing comprehensively to ensure the success of its initiatives, with plans to collaborate with the Ministry of DoNER, the North Eastern Council, under the Prime Minister's Development Initiative for the Northeast Region (PM-DevINE) scheme. "This will make the farmers of the Northeast self-sustainable and self-reliant by establishing a Center of Excellence for Oil Palm in the region and setting up a CPO Refinery for palm oil in the Northeast,"  Singh said.

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Pankhi Sarma