Advertise
Despite inflation in raw material costs and a shifting import duty regime, urban Indian households are continuing to choose premium, health-oriented cooking oils over cheaper refined alternatives, industry executives and analysts say. Demand for cold-pressed and wood-pressed oils - traditionally sold at a significant premium - is holding up better than many market participants expected, sustained by a persistent shift toward healthier eating and wellness.
The niche has become a high-stakes battleground. Consumer goods majors Marico Ltd and Tata Consumer Products Ltd are scaling up their cold-pressed capacity to capture higher gross margins, going head-to-head with smaller direct-to-consumer (D2C) startups that established early dominance through quick-commerce platforms such as Blinkit and Zepto.
Yet the segment is not without obstacles. Rising costs of key inputs - including oilseeds and copra - are forcing brands to absorb margin compression rather than risk alienating price-sensitive shoppers with hikes. Meanwhile, recent reductions in import duties on crude and refined edible oils could push conventional oil prices down and widen the cost differential with premium variants once again.
Even so, executives and analysts expect the premiumization trend to stay intact. With health and brand trust driving the shift, companies are betting that repeat purchases will power growth in both large and smaller cities.
Cold-pressed and wood-pressed oils are extracted from seeds at low temperatures, without the high heat and chemical refining used in conventional oils. Wood-pressed oils are produced using traditional wooden mills, while cold-pressed oils can be made with various types of mechanical presses.
The growing yet still niche segment is valued at approximately Rs.755 crore in 2025 and is projected to reach Rs.1,214 crore by 2034.
Marico, which sells edible oils under its Saffola brand, is 'doubling down on Saffola Cold Pressed Oils', chief executive Saugata Gupta told Mint, calling it an 'emerging consumer trend'. Cold-pressed oils deliver higher margins than Saffola's core edible oil products, making the segment attractive to larger players, he added.
Tata Consumer Products entered the segment through its Tata Sampann portfolio. Managing director and chief executive Sunil D'Souza told analysts on the company's first-quarter earnings call on 24 July that it detected a consumer 'trust deficit' around refined and cold-pressed oils. The Tata brand, he said, helped address that trust gap and offered an opportunity to drive growth with margin expansion.
Cold-pressed oils and dry fruits are now being added to Tata Sampann's core portfolio of pulses, spices, poha, and vermicelli. The brand's cold-pressed oil business had an annual run-rate of about Rs.200 crore in FY26, or roughly 13% of Tata Sampann's revenue of more than Rs.1,500 crore.
Under Food Safety and Standards Authority of India (FSSAI) rules, refined oils must contain less than 5.0 mg/kg of hexane residue and may include approved chemical additives. Cold-pressed and wood-pressed oils, by contrast, must be 100% free of hexane residue and are prohibited from containing any synthetic chemicals, additives or colourings.
Smaller cold-pressed oil makers are also reporting stronger demand, with repeat purchases helping offset the price premium.
Dishit Nathwani, director and chief executive of House of Gulab, estimates that the company's cold-pressed oil business grew from around Rs.40 crore last year to about Rs.70 crore this year, and could cross Rs.120 crore next year. Cold-pressed oils now cost about 1.7-1.8 times as much as conventional variants, he said.
At Adya Organics, consumers who have switched to wood-pressed oils are continuing to buy them despite higher prices. Managing director Pallavi Sinha said volumes have grown over the past six to twelve months, led by repeat buyers. She expects stronger growth in FY27 as the company expands distribution. Mustard is its largest oil category, followed by groundnut.
For Hesthetic Life, rising demand is reflected in both volumes and revenue. Founder and director Ashish Thesia said volumes have risen sharply year-on-year, while revenue has roughly doubled in each of the past two years, reaching close to Rs.28 crore in the latest financial year. More than half of its direct customers repurchase, and consumers who initially buy smaller packs are increasingly trading up to larger ones.
'The differential is still there, but it has narrowed as refined oil prices have gone up,' Thesia said. Quick commerce has become meaningful for the brand, particularly for smaller packs and first-time buyers, while the company's website and Amazon account for a larger share of sales.
Higher global commodity and shipping costs, combined with a weaker rupee, pushed up prices of regular oil and narrowed the price gap, making cold-pressed variants more accessible. Refined sunflower oil, for example, now sells for around Rs.195 a litre, compared with Rs.334 for cold-pressed sunflower oil - a differential of Rs.139.
While demand is holding up, rising seed and copra costs are squeezing margins for premium oil makers, with companies absorbing part of the increase to avoid passing the full burden on to consumers. Adya Organics, for instance, passed on only part of the increase in bought-in seed and copra costs through measured price revisions, absorbing the rest through procurement planning and operational efficiencies, Sinha said. The company grows mustard, groundnut and sesame on its own farm in Bihar, cushioning some volatility.
The category's demand could face a fresh test after recent changes in mainstream edible oil prices. On 23 September, the government cut the basic customs duty on crude soybean and palm oil to 5% from 10%, and on crude sunflower oil to nil from 10%. Duties on refined soybean and palm oil fell to 27.5% from 32.5%, while refined sunflower oil duties declined to 22.5% from 32.5%.
Import-duty reductions typically reach wholesalers within one to three weeks, while retail adjustments can take longer because of inventory and replenishment cycles, said Rahul Guha, senior director at Crisil Ratings. While lower conventional edible oil prices could improve household affordability, Guha does not expect a meaningful shift away from premium categories such as cold-pressed oils, given price sensitivity and the substantial price differential.
Source: MINT