Food major Cargill has acquired an edible oil refinery in Nellore in Andhra Pradesh to expand its footprint in Southern India and strengthen its existing supply chain in the country.
The company said this will entail total investments of about $35 million (₹250 crore-₹270 crore) to acquire, upgrade the facility as well as expand the edible oil production capacity significantly at the facility.

The newly acquired refinery will expand Cargill’s capacity to supply refined palm oil, palm olein, vanaspati (hydrogenated vegetable oil) and sunflower oil and other value-added products. The facility located at Krishnapatnam Port is expected to be fully operational by May next year.

The company’s move comes at a time when the consumers are increasingly shifting towards organised brands post the pandemic.

Piyush Patnaik, managing director of Cargill’s edible oils business in India said this acquisition is in line with the company’s tailored and localised market approach for Asia.

Larger footprint in the south
He added that southern India is the largest market for sunflower oil in the country, accounting for almost two-thirds of the sunflower oil consumption and is currently underserved.

“This is a strategic acquisition for us and will help us expand our footprint in the Southern region. We already have a strong presence in Karnataka through the brand Gemini. So while this acquisition will help us strengthen our presence in Karnataka further, it will also help us expand and build a much larger footprint in Andhra Pradesh, Telangana, and Tamil Nadu,” he added.

The company said it already has a strong presence in the Western, Northern and Eastern regions.

“There has been an acceleration in shift towards trusted packaged branded products in the edible oils space in pandemic times. This facility will help us produce and package our edible oil brands not only for household consumers but also better serve bakery and foodservice customers in the Southern region,” Patnaik said.

Cargill has been operating its edible oils business in India since 2001. Its edible oils and fats brands portfolio includes NatureFresh, Gemini, Sweekar, Leonardo, Rath and Sunflower.