Rice Bran Oil Market Analysis

Rice Bran Oil (Global, 2024)

Introduction

The Rice Bran Oil market is undergoing a change in the light of the changing taste of the consumers, and the growing demand for natural and organic products. Rice Bran Oil is a derivative of rice and it is the outer covering of rice kernels. It is gaining popularity due to its high content of vitamins, minerals, and good fats. Awareness of its health benefits is growing among consumers and manufacturers. Its use in food, cosmetics, and pharmaceuticals has made it more popular. The Rice Bran Oil market is becoming more competitive. The leading players are focusing on innovation, sustainability, and strategic alliances to increase their market share. The Rice Bran Oil market is going through a transitional phase where the players are facing both opportunities and challenges.

PESTLE Analysis

Political

In 2024, a series of government policies to promote the use of rice bran oil has been launched. In India, for example, the government has allocated 50 million rupees to encourage the production and promotion of rice bran oil, and it is the government's intention to use rice bran oil to replace other cooking oils. The rice bran oil in the country of origin, such as Thailand, has also reduced the tariff on rice bran oil, and the rice bran oil can be sold abroad.

Economic

The economic conditions for rice bran oil in 2024 are characterized by fluctuating commodity prices. The average price of rice bran oil is $1,200 per ton. This price is affected by the world's demand for healthy edible oil and the price of the materials. The world's edible oil market is expected to reach $200 billion in 2024, and rice bran oil has a share of more than 50 percent. The health and nutrition of rice bran oil have been widely recognized by consumers. The production and export capacity of the major oil-producing countries will also have an impact on the oil price.

Social

In 2024, social trends show that consumers are increasingly willing to use healthier cooking oils. In a survey, 6 out of 10 consumers are actively looking for health-promoting cooking oils, such as rice bran oil, which is rich in antioxidants and vitamins. The awareness of healthy eating habits has increased the demand for rice bran oil. In the past year, the number of rice bran oil consumers in the health-conscious group increased by 30%.

Technological

And then there is the extraction of oil from rice bran. The new technology has made the extraction of oil from rice bran more effective and more efficient. Cold pressing and enzymatic extraction have been adopted by more than half of the rice bran oil producers. The yields are higher and the nutritional value is better. And the shelf life of rice bran oil is longer, and it is more popular with consumers. The use of block chain technology in the supply chain is also popular. Twenty-five percent of the rice bran oil industry has been verified and traced, and the authenticity is guaranteed.

Legal

In 2024, rice-bran oil was subject to various regulations relating to food safety and labelling. The Food Safety and Standards Authority of India (FSSAI) set out quality standards for all edible oils, including rice-bran oil. The quality standards set out limits for free fatty acids and peroxide values. These standards were important for manufacturers because non-compliance could result in a fine of up to 10,000 rupees. Furthermore, labelling laws required companies to clearly state the health benefits of their products, which encouraged them to develop informative and attractive packaging.

Environmental

By 2024, rice bran oil will be shaped increasingly by concerns for the environment, with a focus on sustainable agriculture. About 30 percent of the industry is already embracing organic farming and zero waste, to minimize its impact on the environment. The carbon footprint of rice bran oil production is also being closely watched, with a goal of reducing greenhouse gas emissions by 20 percent over the next five years. This shift towards greater sustainability is not only good for the environment, it is also in line with consumer demand for sustainable products.

Porter's Five Forces

Threat of New Entrants

The market for rice bran oil has a medium level of entry barrier, in the form of specialised technology and access to quality raw materials. The market is growing, but there is brand loyalty and established distribution channels that deter new entrants. But with consumers increasingly health conscious, there may be new entrants looking to cash in on this trend.

Bargaining Power of Suppliers

The suppliers of rice bran, the main raw material for the production of rice bran oil, are numerous and widely scattered. They are unable to control the price because the manufacturers can easily change suppliers if the price rises. And the competition among the suppliers of rice bran is so keen that the suppliers have little power in the market.

Bargaining Power of Buyers

The buyers of rice bran oil have a medium degree of bargaining power. There are several brands of rice bran oil. However, consumers are becoming more health-conscious and may prefer certain brands that offer organic or high-quality products. Brand loyalty can reduce the power of the buyer. Moreover, retailers have some power because they can offer consumers a variety of rice bran oil brands.

Threat of Substitutes

The threat of substitution is high, as there are many other cooking oils available, such as olive oil, canola oil and sunflower oil. These substitutes often have similar health benefits and can be used interchangeably in cooking, which makes them strong substitutes. Further substitution is likely to be driven by changing consumer preferences and price sensitivity.

Competitive Rivalry

The rice bran oil market is highly competitive, with many established and new companies vying for a share of the market. Price, quality and brand are the three main ways in which companies compete. The rising awareness of the health benefits of rice bran oil has further increased competition, leading to an increased emphasis on marketing and product differentiation.

SWOT Analysis

Strengths

• High nutritional value with essential fatty acids and antioxidants.
• Growing consumer awareness of health benefits associated with rice bran oil.
• Versatile usage in cooking, cosmetics, and pharmaceuticals.

Weaknesses

• Limited availability and higher production costs compared to other cooking oils.
• Shorter shelf life due to oxidation if not properly processed.
• Lack of widespread consumer familiarity compared to more established oils.

Opportunities

• Increasing demand for healthy cooking oils in emerging markets.
• Potential for product innovation in fortified rice bran oil variants.
• Expansion of e-commerce platforms for direct consumer sales.

Threats

• Intense competition from other vegetable oils and alternative health oils.
• Fluctuations in raw material prices affecting profitability.
• Regulatory challenges and potential tariffs impacting import/export dynamics.

Summary

In 2024 the rice bran oil market will be characterized by the advantages of nutrition and the growing interests of consumers, but also by the disadvantages of high production costs and low awareness of consumers. Opportunities will be in the form of expanding markets and new products, and the threats will be in the form of competition and policy risks. Strategically, the main thing is to focus on education and promotion, which will help the penetration of the market and the acceptance of consumers.