Daybreak - How cooking-oil companies have been misleading consumers in India

Episode Date: January 4, 2023

The packaged-food market is rapidly growing in India and along with it so is the edible oil market. It was estimated to be worth nearly Rs 2 lakh crores by the the end of March 2021. Meanwhile, oil companies have been using the media and sneaky branding techniques for decades to tell consumers that their products are healthy.But are they?Tune in to find out.

Hi, this is Rohan Dharma Kumar. If you've heard any of the Ken's podcasts, you've probably heard me, my interruptions, my analogies, and my contrarian takes on most topics. And you might rightly be wondering why am I interrupting this episode too. It's for a special announcement. For the last few months, I and Sita Raman Ganesh, my colleague and the Ken's deputy editor, have been working on an ambitious new podcast. It's called Intermission.

We want to tell the same. secret sauce stories of India's greatest companies. Stories of how they were born, how they fought to survive, how they build their organizations and culture, how they managed to innovate and thrive over decades, and most importantly, how they're poised today. To do that, Sita and I have been reading books, poring over reports, going through financial statements, digging up archives, and talking to dozens of people. And if that wasn't enough, we also decided to throw in video into.

to the mix. Yes, you heard that right. Intermission has also had to find its footing in the world of multi-camera shoots in professional studios, laborious editing, and extensive post-production. Sita and I are still reeling from the intensity of our first studio recording. Intermission launches on March 23rd. To get an alert, as soon as we release our first episode, please follow Intermission on Spotify and Apple Podcast. or subscribe to the Ken's YouTube channel. You can find all of the links at the ken.com slash I am. With that, back to your episode.

The Indian edible oil market was estimated to be close to 2 lakh crore rupees in the year that ended in March 2021. Let's face it, we Indians love fried food. And that kind of explains why the packaged food market is rapidly growing in India. and so is the edible oil market along with it. And among all the different types of refined oils, it is palm oil that is really fueling this growing market. Why? Because it's cheap.

The sales of ultra-processed food, think cereals, chocolates, chips, is expected to reach 8 kilos per capita by 2024. Less than two decades ago, it was just 2 kilos per capita. Most of the ultra-processed food that we consume uses some amount of palm oil. But domestic supplies of oil have been stretched lately. And the price of cooking or edible oil, as we all know, has gone up significantly. So last week, the government of India announced that traders will be allowed to import refined palm oil without license beyond December 2020. The idea is to increase domestic supplies and bring down prices.

Now, if there is one thing that immediately strikes you when you think of refined edible oils in India, is that they all claim to be healthy. Think of all the brand names. We have Fortune Soi Health, Dara Health Refined Sunflower Oil, Sappola Active, there are so many more. All these brand names give us the impression that not only are the, these oils safe, but they are actually healthy for us, right? Well, we are wrong.

And today, I will tell you how cooking oil companies in India have been misleading their consumers. Welcome to Daybreak, a brand new podcast from the Ken. I'm your host, Nick Dha Sharma, and in each episode, I will tell your business story that is current, significant, and most importantly interesting. Today is Wednesday the 4th of January. The belief that the cooking oils we use in our homes every day are healthy is an outcome of years and years of targeted media campaigns by oil companies.

Remember this iconic sundrop refined oil ad from the 90s? It featured a young boy in a yellow jumpsuit bouncing around on puries and gullab jams. Over the years, the more health-conscious we became, the more oil makers pushed different variations of words associated with health in their branding. But like they say, God, or the devil in this case, is in the details. Oil makers have been generously throwing words like health in brand names, but they bury the caveat in the fine print.

Take for example Adani Wilmar's refined soybean oil that goes by the brand name Fortune Soy Health in bold letters on the front of the bag. Turn the pouch around and add the back. in small, tiny letters it reads, and I'm quoting, the word health is only a brand name and does not represent its true nature. End quote. We know that most packaged snacks in India are made using cheap oils.

But what is surprising is how companies get away by misbranding them as low calorie or calling them light. Companies bypass the Food Safety Standards Authority of India, or FSSAI's regulations by including terms like healthy in their brand names to increase consumer appeal. Take for example one of Haldi Ram's so-called healthy range of snacks called low-calorie multi-grained hale. One would immediately think it is what it says it is, right? Low calorie. But read the nutrition label carefully. The 100 gram pack has 468 kilo-calories.

But according to the Food Standard Authority's regulation, the limit for claiming that any snack item is low calorie is 40 kilo calories per 100 grams. Halthiram's low calorie bhael is more than 10 times this limit. So now I'm going to drop a few truth bombs about the edible oils that we consume in India. So be prepared. Here is the first one. All refined oils go through multiple purification processes that use harmful. chemicals like hexane.

Short-term exposure to high levels of hexane causes mild central nervous system effects including dizziness, giddiness, slight nausea and headache. Chronic or long-term exposure to hexane in the air is associated with polyneurropathy in humans with numbness in the extremities, muscular weakness, blurred vision, headache and fatigue. Neurotoxic effects have also been exhibited in raps.

So why do we use hexane if it is so bad? The intense chemical processing of oils using hexane is to extract the maximum quantity of oil from the seeds. The MD of BL Agro Industries told the ken that after the extraction, the oil undergoes a process to ensure that the oil does not contain traces of hexane. After this, the oil is again bleached and deodorized. This is to get that silky, translucent texture that for some reason we are so obsessed with. But wait, if you're thinking the hexane has been removed from your oil, again, you are wrong. It has been estimated that refined oils extracted with hexane still contained around 0.8 milligrams of residual hexane per kilo of oil. And now for the second truth bomb.

Reusing refined oil, which is a very common practice at restaurants and even homes in India, produces toxic elements that may cause cancer. Let me explain this better. Oil, by nature, is highly reactive and volatile. Frying moisture-laden refined flour dough or vegetables like potatoes eventually makes the oil rancid. A scientist at Fair Labs broke it down for us. They said, and I'm quoting, exposure to moisture leads to chemical bonds of the oil

breaking up into toxic components called total polar compounds or TPCs. TPCs include short-chain fatty acids like aldehydes, ketones and alcohols. Such components are cancer-causing elements. End quote. And finally coming to truth bomb number three. The health risks increase even more when oils are turned into solid fats like shortening or margarine. These are called partially hydrogenated oils. They are mostly used in ultra-processed food like chips, numkines and baked items like cookies and cakes.

These contain harmful trans fats which have been linked to an increased risk of heart attacks. The WHO has actually been trying to eliminate trans fats. from the food supply chain. In fact, they plan on doing it by 2023, which is this year. And here is where palm oil comes in. Palm oil has up to 50% saturated fat content and it helps the process of solidification of other oils faster during the process of hydrogenation.

It also helps control levels of trans fats in hydrogenated vegetable oil mixtures. Shami Agarwal, the director of FMCG, brand Pansari Group told the ken that palm oil comes cheap. Pansari imports 4,000 to 5,000 metric tons of crude palm oil worth 30 to 40 40 crore rupees from Malaysia and Indonesia every month. The company then supplies refined palm oil to large FMC companies like Nestle, ITC and Britannia for manufacturing ultra-processed foods like noodles and biscuits.

Our consumption of such ultra-processed food is going up by the minute. This probably also explains why one-fourth of the Indian population that has a body mass index or BMI of over 25 is fighting obesity. So what is the alternative? Multiple insiders from the industry that the Ken spoke to very reluctantly admitted that these refined oils have an alternative. And it is organic cooking oils. They said that the oils sourced by cold pressing techniques are better than the oils that are mass produced through processing. But if you ever bought cold press oil,

you will know that they are super expensive. One litre of cold pressed or extra virgin coconut oil can cost up to $1,000. Plus, it doesn't help that the organic cooking oil market in India is poorly regulated. Also, the whole point of cold pressing is lost if you use cold pressed oil to deep fry food. Now, research on fat so far is pretty conflicting, which is why the whole good fat versus bad fat debate is still raging.

Some say eating vegetable fats instead of animal fats is healthier, but honestly, science is still divided on the matter. But if we go by the increasing amount of evidence, vegetable fats are not necessarily always healthy. And though we do not know when we will get an answer to this debate, one thing that we know for sure is that cooking oil brands available in the Indian market have been knowingly misleading consumers and it is about time, someone does something about it. Daybreak is produced from the newsroom of the Ken, India's first subscriber-focused business news platform.

What you're listening to is just a small sample of our subscriber-only offerings. A full subscription unlocks daily long-form feature stories, newsletters, subscribe-only apps and podcast extras. Head to the ken.com and click on the red subscribe button on the top of the website. I am Snekda Sharmaio host and today's episode was edited by my colleague Rajiv Sien.