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Palm oil ban in Sri Lanka: Is it sustainable?

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By Erandathie Pathiraja

Sri Lanka’s edible oil market has received considerable attention in recent weeks due to a series of events: the banning of palm oil importation in a bid to promote the coconut industry, detection of aflatoxins in imported coconut oil, importation of coconut kernel chips, issuing license for palm oil imports, and banning of oil palm cultivation.

The edible oil industry is important for Sri Lanka. Oils and fats are a major constituent of the typical Sri Lankan diet and a raw material in manufacturing, in particular the food manufacturing industry. According to the latest available data, there are around 5,057 establishments employing 332,828 workers in the formal food manufacturing sector which generate an annual output of approximately LKR 1.4 billion. This blog assesses the local edible oil market and its potential for import substitution.

Sri Lanka’s Edible Oil Market

The demand for domestic edible oils comes from two segments: households and industries. Data from the 2016 Household Income and Expenditure Survey (HIES) of the Department of Census and Statistics (DCS) show that an average household consumes 1.6 litres of fats and oils per month and the annual consumer demand is around 96,249 MT, with coconut oil being the main source of edible oil (Figure 1). Industrial demand in 2020 can be approximated to 167,372 MT.

This demand for edible oils in the country is met by locally produced oils as well as imported oils. Coconut oil and palm oil are the local edible oil sources. In 2020, total edible oil production was 44,326 MT. Coconut oil production was 19,759 MT which depends on annual coconut production. Crude palm oil and palm kernel oil production was 24, 567 according to the Coconut Development Authority (CDA). According to the CDA, the quantity of imported fats and oils in 2020 was 219,295 MT. A range of edible oils are imported to meet industrial demand and partially to meet household demand (Figure 2). The foreign exchange outflow in 2020 was LKR 37,378 million for edible oils imports.

Total edible oil supply during 2020 was 263, 621 MT both from local production (44, 326 MT) and imports (219,295). Around 83% of the requirement is met by imports, and industrial demand is nearly two-thirds of the total demand (Figure 3).

The available data show that it is difficult to meet the edible oil demand from the local supply. The average coconut production during the last five years was around 2,792 million nuts. Nearly 65-70% of the produce is consumed as fresh coconuts (1,800 million nuts). Processing industries utilise the remaining coconuts (around 1,000 million). Around 108,108 MT of coconut oil can be produced from 1,000 million nuts at the expense of export industries, yet 155,513 MT of excess demand has to be met. Palm oil is cultivated in 12,000 Ha which is expected to produce nearly 48,000 MT. Together, coconut and palm oil can be expected to supply 156,108 MT of edible oil, which is still short of 107,513 MT of oil required to meet the consumer and industry demand.

Way Forward

Given the current context, Sri Lanka cannot meet its edible oil demand as the coconut supply is not sufficient to meet the edible oil demand, and expansion of production is difficult in the short term. Imported edible oils are an essential ingredient in food manufacturing due to its unique properties and low cost. Therefore, facilitating importation is required to meet the local demand.

Sri Lanka spends around LKR 37 billion for edible oil imports, and looking for alternatives is a sensible solution. Rice bran oil is a potential byproduct of paddy milling and it does not demand extra land for cultivation. Sri Lanka has to invest in utilising this potential resource. Measures to achieve optimum productivity from existing coconut lands are vital to reduce oil imports.



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Dialog Enterprise with Fortinet strengthens the security of its Managed SD-WAN Service for Sri Lankan Enterprises

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Dialog Enterprise, the corporate solutions arm of Dialog Axiata PLC, announced the strengthening of its Flexnet managed SD-WAN service leveraging the Secure SD-WAN solution from Fortinet, a global leader in cybersecurity with broad and integrated solutions.

Dialog Enterprise pioneered the Sri Lanka’s first Managed SD-WAN service with the release of its Flexnet offering since September 2019. Two years after, most modern organisations are embracing digital acceleration, driving demand for greater agility in networks in order to stay competitive and deliver superior customer experiences. With the scale and variety of cyber threats continuing to grow, Dialog Enterprise enhances its Flexnet service with the Fortinet Secure SD-WAN. Fortinet Secure SD-WAN accelerates network and security convergence, aims at simplifying WAN architecture, and securing work-from-anywhere new normality with embedded ZTNA (zero-trust network access) Access Proxy for explicit per-user application access controls. It delivers integrated security and safer access to internal and external data and applications wherever they are residing, on-premises, or in the cloud.

By integrating Fortinet Secure SD-WAN solution to its Flexnet managed SD-WAN service, Dialog Enterprise will enable its customers the ability to cost-effectively eliminate security gaps in their network while gaining the benefits of advanced routing and self-healing WAN capabilities to ensure superior quality of experience for their users, and an increased business uptime. Additionally, an improved connectivity and user experience can be achieved through an integrated security by prioritizing network traffic and reduced latency. As well as the benefit of an integrated security by prioritizing network traffic is achieved by offering, unified thread management, SSL inspection and proactive security threat prevention.

“With the recent shift to remote working, cloud adaptation and SaaS usage accelerating SD-WAN adoption with organizations, many of our customers in the government, finance, retail, services and manufacturing industries will benefit from Dialog Enterprise’s Managed SD-WAN based on the Fortinet Secure SD-WAN solution. It provides us with an integrated, one-stop management and orchestration console to ensure that connections, configurations, advanced routing features and protections are easily configurable. Being the only Fortinet Managed Security Service Provider in Sri Lanka, we have already been able to provide Secure SDWAN solutions with Fortinet in over 1000 locations across the island.” said Navin Pieris, Group Chief Officer – Dialog Enterprise at Dialog Axiata PLC.

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SLT-MOBITEL completes first phase of Amazon Alexa integrations for Home Broadband customers offering exciting digital lifestyles

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The first phase of fully integrating Amazon Alexa for SLT-MOBITEL Home Broadband customers was successfully concluded recently. Now customers can seek help from Amazon’s virtual smart assistant Alexa and obtain a range of information on SLT-MOBITEL services such as Voice, Broadband, PEO TV services etc. ensuring subscribers experience exciting new intelligent built digital lifestyles.

Pictured Dilshan Boteju, Chief Executive Officer of The Connection Workshop, handing over the report on the concluded project to Prabhath Dahanayake, Chief Marketing Officer SLT. Also present were Lathika Weerasinghe, Administrative Coordinator, Anup Silva, Lead Developer Alexa program of The Connection Workshop, Ayoma Wickramaarachchi, Deputy General Manager, Product Development & Management of SLT, Ruwan Rekogama, Engineer-Product Development & Management of SLT.

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Loops wins big at SLIM DIGIS

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Award-winning creative-led integrated marketing agency, Loops Integrated, received 6 recognitions, including a Gold, at the SLIM DIGIS Awards, held on the 25th of January 2022. Loops Integrated received the only Gold DIGI in the Banking and Finance category for Softlogic Invest’s “This Could Be You” campaign, a Silver DIGI in the Performance Marketing category for British Council’s IELTS programme, and another Silver DIGI in the Best Use of Branded Content category for Sri Lankan Airlines. In addition to these three prestigious awards, Loops Integrated also received 3 finalist awards for the Banking & Finance, Performance Marketing and Best Use of Branded Content categories.

Discussing the awards, CEO at Loops, Wasaam Ismail said, “We work with our clients as partners, therefore it’s important to say a big thank you to them for having faith in us and letting us take their campaigns to town. Putting together creative-led campaigns amidst working from home during periodic lockdowns is nothing short of a herculean undertaking, which would not have been possible without our stellar team. Therefore, I must also acknowledge and appreciate our exceptionally talented, committed, dedicated and mind-blowingly fun team here at Loops, without whom none of this would be possible. A big thank you also to SLIM for ensuring that digital marketers in Sri Lanka have a national platform upon which to be recognized.”

The SLIM DIGIS awards is organized by the Sri Lanka Institute of Marketing (SLIM) and recognizes and celebrates Sri Lanka’s best digital marketing work, innovation and talent. SLIM is the national body for marketing in Sri Lanka and the SLIM DIGIS is among Sri Lanka’s most prestigious awards programmes that recognize innovation and budding talent in the digital marketing space.

Loops is an award-winning Creative Led Integrated Marketing Agency with operations in Sri Lanka, Qatar, Malaysia & Australia. The agency has worked with over 250 brands in 15 countries and has over 50 awards for its efforts in creative and digital excellence, awarded by both international and local bodies. Visit www.loops.lk to learn more.

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