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These brands of vegetable oil battle for market share

Nigerians are lovers of tasty meals and globally, vegetable oils continue to play crucial roles in the preparation of such meals.

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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.

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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.

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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.

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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.

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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.

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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.”

The Verdict

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%.

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.

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.

Patricia

Fikayo has a degree in computer science with economics from Obafemi Awolowo University. ITIL v3 in IT service management. An alumnus of Daystar Leadership Academy. Prior to joining Nairametrics had stinct in Project management, Telecommunications among others. Also training in Consulting and Investment banking from Edubridge Academy. He has very keen interest in Politics, Agri-business, private equity and global economics. He loves travelling and watching football. You can contact him via [email protected]

1 Comment

1 Comment

  1. Toju Daniels

    July 5, 2018 at 11:02 am

    Grand and Sunola because they are soy oil (the others are refined palm oil). Grand especially because I know their factory in Jos. #eattheoneyouknow

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Coronavirus

COVID-19 Update in Nigeria

On the 6th of July 2020, 575 new confirmed cases and 9 deaths were recorded in Nigeria bringing the total confirmed cases recorded in the country to 29,286.

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The spread of novel Corona Virus Disease (COVID-19) in Nigeria continue to record significant increase as the latest statistics provided by the Nigeria Centre for Disease Control reveal Nigeria now has 29,286 confirmed cases.

On the 6th of July 2020, 575 new confirmed cases and 9 deaths were recorded in Nigeria, having carried out a total daily test of 1,831 samples across the country.

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To date, 29,286 cases have been confirmed, 11,828 cases have been discharged and 654 deaths have been recorded in 36 states and the Federal Capital Territory. A total of 152,952 tests have been carried out as of July 6th, 2020 compared to 151,121 tests a day earlier.

COVID-19 Case Updates- 6th July 2020

  • Total Number of Cases – 29,286
  • Total Number Discharged – 11,828
  • Total Deaths – 654
  • Total Tests Carried out – 152,952

According to the NCDC, the 575 new cases were reported from 20 states- Lagos (123), FCT (100), Delta (58), Edo (52), Ogun (42), Katsina (24), Bayelsa (23), Rivers (22), Borno (19), Plateau (18), Ondo (18), Oyo (17), Kwara (15), Osun (13), Enugu (9), Nasarawa  (7), Abia (6), Cross River (5), Kaduna (3), Ekiti (1).

Meanwhile, the latest numbers bring Lagos state total confirmed cases to 11,367, followed by Abuja (2,281), Oyo (1,530), Edo (1,435), Delta (1,285), Kano (1,268), Rivers (1,205), Ogun (1,047),  Kaduna (868), Katsina (628), Borno (547), Gombe (520), Bauchi (516), Ebonyi (503), Ondo (474), Plateau (454), Abia (391), Enugu (381), Imo (352), Jigawa (318).

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Kwara state has recorded 284 cases, Bayelsa (268), Nasarawa (232), Osun (178), Sokoto (153),  Niger (122), Akwa Ibom (112), Adamawa (99), Benue (97), Kebbi (84), Zamfara (76), Anambra (73), Yobe (61), Ekiti (45), Taraba (22), while Kogi state has recorded 5 cases.

 

READ ALSO: COVID-19: Western diplomats warn of disease explosion, poor handling by government

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Lock Down and Curfew

In a move to combat the spread of the pandemic disease, President Muhammadu Buhari directed the cessation of all movements in Lagos and the FCT for an initial period of 14 days, which took effect from 11 pm on Monday, 30th March 2020.

The movement restriction, which was extended by another two-weeks period, has been partially put on hold with some businesses commencing operations from May 4. On April 27th, 2020, Nigeria’s President, Muhammadu Buhari declared an overnight curfew from 8 pm to 6 am across the country, as part of new measures to contain the spread of the COVID-19. This comes along with the phased and gradual easing of lockdown measures in FCT, Lagos, and Ogun States, which took effect from Saturday, 2nd May 2020, at 9 am.

On Monday, 29th June 2020 the federal government extended the second phase of the eased lockdown by 4 weeks and approved interstate movement outside curfew hours with effect from July 1, 2020.

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READ ALSO: Bill Gates says Trump’s WHO funding suspension is dangerous

DateConfirmed caseNew casesTotal deathsNew deathsTotal recoveryActive casesCritical cases
July 6, 202029286575654911828168047
July 5, 2020287115446451111665164017
July 4, 202028167603634611462160717
July 3, 2020275644546281211069158677
July 2, 2020271106266161310801156937
July 1, 2020264847906031310152157297
June 30, 202025694561590179746153587
June 29, 20202513356657389402151587
June 28, 20202486749056579007149957
June 27, 20202407777955848625148947
June 26, 20202329868455458253144917
June 25, 20202261459454977822142437
June 24, 20202202064954297613138657
June 23, 20202137145253387338135007
June 22, 20202091967552577109132857
June 21, 202020242436518126879128477
June 20, 202019808661506196718125847
June 19, 202019147667487126581120797
June 18, 20201848074547566307116987
June 17, 202017735587469145967112997
June 16, 202017148490455315623110707
June 15, 20201665857342445349108857
June 14, 202016085403420135220104457
June 13, 20201568250140785101101747
June 12, 20201518162739912489198917
June 11, 2020145546813875449496737
June 10, 20201387340938217435191407
June 9, 2020134646633654420688937
June 8, 2020128013153617404084007
June 7, 20201248626035412395981737
June 6, 2020122333893429382680657
June 5, 20201184432833310369678157
June 4, 2020115163503238353576467
June 3, 2020111663483151332975227
June 2, 20201081924131415323972667
June 1, 20201057841629912312271579
May 31, 20201016230728714300768687
May 30, 2020985555327312285667267
May 29, 202093023872612269763447
May 28, 202089151822595259260647
May 27, 202087333892545250159787
May 26, 2020834427624916238557107
May 25, 202080682292337231155247
May 24, 202078393132265226353607
May 23, 202075262652210217451317
May 22, 2020726124522110200750337
May 21, 2020701633921111190748987
May 20, 202066772842008184046377
May 19, 202064012261921173444757
May 18, 202061752161919164443407
May 17, 202059593881826159441837
May 16, 202056211761765147239737
May 15, 202054452881713132039544
May 14, 202051621931683118038154
May 13, 202049711841646107037374
May 12, 20204787146158695936704
May 11, 202046412421521090235894
May 10, 202043992481421777834794
May 9, 202041512391271174532784
May 8, 202039123861181067931154
May 7, 20203526381108460128184
May 6, 20203145195104553425071
May 5, 2020295014899548123704
May 4, 2020280224594641722912
May 3, 2020255817088240020702
May 2, 20202388220861735119522
May 1, 20202170238691035117512
April 30, 2020193220459731715562
April 29, 2020172819652730713692
April 28, 2020153219545425512322
April 27, 20201337644102559942
April 26, 20201273914152399942
April 25, 20201182873632229252
April 24, 202010951143312088552
April 23, 20209811083231977532
April 22, 2020873912931976482
April 21, 20207821172631975602
April 20, 2020665382311884662
April 19, 2020627862221704362
April 18, 2020541482021663562
April 17, 2020493511841593172
April 16, 2020442351311522772
April 15, 2020407341211282672
April 14, 202037330111992632
April 13, 202034320100912422
April 12, 20203235100852282
April 11, 202031813103702382
April 10, 20203051770582402
April 9, 20202881471512302
April 8, 20202742260442262
April 7, 20202541661442042
April 6, 2020238650351982
April 5, 20202321851331942
April 4, 2020214540251850
April 3, 20202092542251800
April 2, 20201841020201620
April 1, 2020174352091630
March 31, 202013982091280
March 30, 2020131202181210
March 29, 2020111221031070
March 28, 20208919103850
March 27, 2020705103660
March 26, 20206514102620
March 25, 2020517102480
March 24, 2020444102410
March 23, 20204010112370
March 22, 2020308002280
March 21, 20202210001210
March 20, 2020124001110
March 19, 20208000170
March 18, 20208500170
March 17, 20203100030
March 16, 20202000020
March 15, 20202000020
March 14, 20202000020
March 13, 20202000020
March 12, 20202000020
March 11, 20202000020
March 10, 20202000020
March 9, 20202100020
March 8, 20201000010
March 7, 20201000010
March 6, 20201000010
March 5, 20201000010
March 4, 20201000010
March 3, 20201000010
March 2, 20201000010
March 1, 20201000010
February 29, 20201000010
February 28, 20201100010

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FG to shut Third Mainland Bridge for 6 months  

The Third Mainland Bridge is the longest of three bridges connecting Lagos Island to the mainland. 

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The FederalThird Mainland Bridge, Housing: Tackling Nigeria’s huge housing deficit, Nigerian roads are not that terrible, Fashola says 

The Federal Government has announced plans to shut down the Third Mainland Bridge for maintenance work from July 24, 2020. 

This was disclosed by the Federal Controller of Works in Lagos, Mr Olukayode Popoola, during an interaction with the News Agency of Nigeria (NAN) on Monday July 6, 2020. 

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In the conversation, Popoola said that consultations were on for another phase of repair works to commence on the Third Mainland Bridge. He told the News Agency of Nigeria that the consultations were towards developing a perfect traffic management architecture that will be very efficient and effective. 

According to PopoolaWe want to do maintenance work on Third Mainland Bridge very soon. Most likely on the 24th. We may close it from 24th of July.’’ 

READ ALSO: Update: FG increases fuel price to N143.80 per litre

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“We are still working out the modalities and when we perfect the traffic management plan we will move to site. Everything being expected for the repairs of the bridge arrived the country that is why we want to start the repairs now,’’ 

The 11.8km bridge which has gone through series of rehabilitation works was last closed for repairs in August 2018 for 3 days of investigative maintenance check. 

Thereafter, some components needed for completion of repairs were sourced abroad because they were not available locally. 

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Meanwhile, a monitored report from Channels suggests that the closure might last for a period of 6 months.

READ ALSO: Nigeria to raise N163.32 billion through road concessions programme

There has been reports of some worn-out joints of the bridge, which has raised some serious safety concerns for the users of the bridge. The federal government will be working with the Lagos State Traffic Management Agency (LASTMA) on how best traffic during this period. 

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The Third Mainland Bridge is the longest of three bridges connecting Lagos Island to the mainland. 

The bridge starts from Oworonshoki which is linked to the Apapa-Oshodi Expressway and the Lagos-Ibadan Expressway and ends at the Adeniji Adele Interchange on Lagos Island. 

It was opened for use 1990 and was the longest in Africa until 1996 when The 6th October Bridge in Cairo was completed. 

 

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Around the World

FRC orders the Big Four to separate auditing from consulting services

The Big Four firms now reportedly generate the largest portions of their revenues from consultancy services.

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Big Four

The world’s four biggest audit firms —KPMG, PwC, Ernst & Young, and Deloitte — have been directed by the Financial Reporting Council (FRC) to plan towards separating their audit services from their consulting services.

The deadline for compliance with this directive is June 2024.

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A statement that was published on the FRC website said this directive is ‘world-leading’. The statement also explained why it became imperative to separate the firms’ operations towards ensuring that they deliver the uttermost quality audit services for the good of public interest.

By the time the operational separation officially takes effect starting from June 2024, FRC said it would be expecting the following outcomes:

  • That audit practice governance would prioritise audit quality and protect auditors from influences from the rest of the firm that may try to divert their focus away from audit quality.
  • That the total amount of profits distributed to the partners in the audit practice does not persistently exceed the contribution to profits of the audit practice.
  • The culture of the audit practice prioritises high-quality audit by encouraging ethical behaviour, openness, teamwork, challenge and professional scepticism/judgement.
  • Auditors act in the public interest and work for the benefit of shareholders of audited entities and wider society.

While commenting on this development, FRC’s Chief Executive Officer, Sir Jon Thompson, said the FRC is committed to reforms on how corporate finances are reported. Further aspects of the reform package will be introduced over time, he said.

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“Operational separation of audit practices is one element of the FRC’s strategy to improve the quality and effectiveness of corporate reporting and audit in the United Kingdom following the Kingman, CMA and Brydon reviews. Today the FRC has delivered a major step in the reform of the audit sector by setting principles for operational separation of audit practices from the rest of the firm. The FRC remains fully committed to the broad suite of reform measures on corporate reporting and audit reform and will introduce further aspects of the reform package over time,” Thompson stated.

Do note that the FRC reached this decision after engaging in extensive discussions with the Big Four. It was also agreed that the audit firms will submit an implementation plan to the FRC latest by October 23rd, 2020.

Recall that it was just last week when Nairametrics reported how the Big Four earned the sum of N7.53 billion as audit fees from Nigeria’s most capitalized firms in 2019. Interestingly, these firms now reportedly generate the largest portions of their revenues from consultancy services. As a matter of fact, only about 20% of their revenues now come from auditing fees.

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Patricia
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