Financial Daily from THE HINDU group of publications
Wednesday, Jul 14, 2004

Cross Currency

Group Sites

Agri-Biz & Commodities - Oilseeds & Edible Oil
Corporate - Alliances & Joint Ventures

Cargill in pact with Parakh Foods to expand edible oil business

G. Chandrashekhar

Mumbai , July 13

THE Indian arm of the US agri-business giant Cargill India is set to considerably expand its edible oil business in the country. As a prelude, the multinational has signed a memorandum of understanding with Parakh Foods Ltd, owners of Gemini, one of the fastest growing edible oil brands in India.

Once due diligence is completed, a joint venture company is expected to be floated with Cargill and Parakh Foods sharing 50:50 stake.

The Pune-based Parakh Foods has two large refineries with an aggregate refining capacity of 2,500 tonnes a day, including one at Kurkumbh in Maharashtra. In last two years, the company has expanded its presence in the highly competitive domestic market with aggressive marketing of various edible oils under the brand name Gemini.

Cargill India is into various foods including grains and edible oils. The company has established a large (said to be 1,500 tonnes a day) modern refinery in Paradeep (Orissa), but the factory is yet to commence commercial production.

Both the companies have business interests in Kutch region, where the government has exempted edible oil refining units from paying excise duty of Rs 1,000 a tonne.

Once finalised, the joint venture company will be the largest in the country's edible oil business with around 5,000 tonnes of refining capacity per day.

The joint venture will help leverage the strengths of both companies - international trading expertise of Cargill and domestic market knowledge of Parakh Foods.

The highly fragmented edible oil refining industry has in the last three years witnessed an explosion of new refining capacities (units with 1,000 tonnes a day and above), mostly concentrated near port towns such as Kakinada and Kandla. All these units are almost entirely dependent on crude oil imports.

India already has a couple of successful joint ventures in the edible oil sector including the Mundhra-based Adani-Wilmar combine.

More Stories on : Oilseeds & Edible Oil | Alliances & Joint Ventures

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

Stories in this Section
Second chance

Steady trend in spot rubber prices
Service tax on commodity futures — Govt may get Rs 120 cr from broking fees
Kerala to set up River Basin Organisation
Amul setting up Rs 58-cr powder plant in Gujarat
Milma token strike on July 15
Dry spell may impact coarse grains, pulses
Cargill in pact with Parakh Foods to expand edible oil business
Budget proposal to help value-added chicken units
Pepper rules steady
Oil cos asked to work out subsidised diesel scheme for farmers

The Hindu Group: Home | About Us | Copyright | Archives | Contacts | Subscription
Group Sites: The Hindu | Business Line | Sportstar | Frontline | The Hindu eBooks | The Hindu Images | Home |

Copyright 2004, The Hindu Business Line. Republication or redissemination of the contents of this screen are expressly prohibited without the written consent of The Hindu Business Line