Nigerians are lovers of tasty meals and globally, vegetable oil continues to play a crucial role in the preparation of such meals.
The name, vegetable oil, is the generic term for cooking oils which are extracted from various plants such as groundnut, soya-bean, corn, cottonseed, rapeseed (canola), etc.
Initially, most households depended largely on locally sourced cooking oils and expensive imported vegetable oil products.
But recently, the market has been saturated with vegetable oils produced by companies in Nigeria. This has been largely aided by the recent government ban on access to the interbank exchange market for importers of foreign-produced vegetable and palm oils.
Finally, after a long period where the vegetable oil market in Nigeria was dominated by foreign brands like Turkey and Kings, local brands can now thrive and compete favourably.
In this article, we would examine the various local brands battling for market share and see which one has a chance of emerging as the winner.
Major brands in the market
A research by Nairametrics shows that the market currently has more than 10 brands (local and foreign) doing battle for market share.
Key players in the market include Mamador and Devon King’s brands produced by PZ Wilmar Limited, a subsidiary of PZ Cusson Nigeria Plc, and Sunola Oil brand which is produced by Sunseed Nigeria Limited, member of Kewalram Chanrai Group. The company recently commissioned its new production plant in Zaria. This, according to the company, will further boost its market penetration, mostly in the northern part of the country.
Other brands are Grand Oil, a product of Grand Cereals and Oil Limited, and Power Oil by Dufil Prima Foods Plc, makers of Indomie Instant Noodles.
More companies in the sector are Nosak Group, makers of Famili Pure Vegetable Oil, Sidex Nigeria Limited, makers of Lesieur Pure Vegetable Oil and other foreign-based companies whose products have found their way into the Nigerian market, like Wesson Canola Oil.
The health scare
Nutritionists have attributed the prevalence of heart-related diseases to the intake of vegetable oil brands which contain components that are not heart-friendly.
According to a nutritionist, Mr. Kingsley Okey, most vegetable oils in the market are preserved by a process called partial hydrogenation. A process whereby a fraction of the unstable polyunsaturated fats are converted to much more stable trans fats. And it is these trans fats that give commercial vegetable oils their unnaturally long shelf lives.
Producers of vegetable oil in the country are now positioning their products based on consumers’ health consciousness, while also paying attention to product repackaging and visibility.
Also, brands in the country now rely on endorsements from Nigerian Heart Foundation (NHF) and Nutrition Society of Nigeria (NSN) to reinforce the confidence consumers have in made-in-Nigeria brands.
The various regulatory agencies in the country such as the Standard Organization of Nigeria (SON) among others have also embarked on series of sensitisation programs on the need to buy only cholesterol-free vegetable oils.
A war of prices and sizes
A visit by Nairametrics to some markets and retails outlets revealed that the vegetable oil market is dominated by five brands namely Sunola Oil, Grand Oil, Power Oil, Mamador and Devon King’s.
These top brands have adopted some marketing elements such as product segmentation into more affordable smaller sizes, repackaging and availability to enhance consumer attention and acceptance of their products over foreign brands.
In the “battlefield”, price has become a very important factor as the various brands battle for market share and profitability. Interestingly, prices for different carton sizes of the vegetable oil brands differ depending on the market location.
A 3-litre plastic bottle of Grand Oil sells for N2,997; Power Oil sells for N2,480; Devon King’s sells for N3,000. A 1-litre bottle of Devon Kings Oil sells for between N900 and N1,000; Mamador Oil sells for N870, while Sunola Oil goes for N950. The 5-litre gallons of Devon King’s and Sunola Oil sell at N3,750 and N4,300 respectively. Also, 75cl of Grand Oil, Power Oil and Mamador Oil sell for N590, N625, and N850 respectively.
What consumers say
A sample of opinions conducted by Nairametrics on vegetable oil preferences in some parts of Lagos shows that consumers are very conscious of the types of vegetable oils they use.
Mrs. Esther Chigui, a mother of two, noted that she uses two brands (Sunola Oil and Power Oil) interchangeably, depending on their availability, but noted that Sunola Oil bubbles when frying with it, while Power Oil gets congealed when it comes in contact with cold items for long, or when put in the refrigerator.
A housewife, Mrs. Oyedokun, noted that Power Oil turns black after using it thrice, depending on what it is fried with.
In her words:
“If you fry ‘panla’ fish thrice with Power Oil, it becomes dark, a situation which has pushed me away from the brand.”
Speaking on the packaging of vegetable oils by manufacturers, Mr. Kenny Adewale, who owns a retail outlet, revealed that Power Oil pioneered the sachet pack market.
He also noted that over time, packaging had been a major challenge in the vegetable oil industry but they have all overcome it.
In his words:
“Before now, they never wanted to deviate from their traditional ways of packaging their products. Transiting from tin gallons to plastic, and now sachet packs is a step that has revolutionised the industry.”
Another respondent, Nkechi Okoro said that she prefers Devon King’s because it has become a household name that has stuck with her, but she noted that other edible oil brands in the market are good, especially in light of their endorsements by the regulatory authorities.
A major distributor of cooking oils around Ogba, a suburb in Lagos, who preferred anonymity said that she sells various edible oil brands and they all enjoy patronage.
“From my records, the five brands are doing well, even though I have other imported brands in my store that are also doing well.”
In our Nairametrics Poll on Twitter, we listed 3 of the top vegetable oil brands and participants voted for their favourites. Power Oil scored a total of 48%, while Devon King scored 30%, and Mamador Oil had 24%.
Which of these brand of vegetable oil stands out for you?
Kindly RT after voting.
— Nairametrics (@Nairametrics) July 2, 2018
In the comment sections of our polls, run across our social media platforms, there were divergent opinions of the products by consumers, which indicated that the choice of brands is mostly influenced by price, size, and taste.
A respondent on our Facebook said that the King’s brand is cheaper and he gets value for money. Another respondent commented that he prefers the Power Oil Brand.
Devon king oil
— Maria Odobo (@maria_odobo) July 4, 2018
The competition for market share is very stiff as brands continue to battle. While Power Oil won in the poll, we cannot announce it to be the undisputed winner, as there were still complaints by consumers.
It is also apparent that the other brands are holding their own in this battle as all brands are being used by consumers. Also, there is no distinct quality in any brand that was mentioned by consumers and distributors.
There are still many opportunities that the manufacturers can leverage for profitability. At this point, the race may still be won by the brand with the most visibility and best strategy for capturing customer loyalty.