Cocopeat Making Project Report, Business Plan

Cocopeat Making Project Report, Business Plan in India

Introduction      

Hello friends, today we are here with a new topic of “cocopeat making project report and cocopeat making business plan” in India. Coir pith or Cocopeat or dust is a biomass material obtained during the extraction of coir fiber through coconut husk and hence a byproduct of the coir industry. This material is popularly known as Cocopeat. The cocopeat is a very lightweight and compressible material. It is tending to hold water to several folds than its weight. Coir pith or Cocopeat has the property to be compressed into many valuable products like seed cells, propagation modules, etc.

A step-by-step guide to Cocopeat Making Project Report, Business Plan in India

Why Cocopeat or Coir pith has gained more importance in the market?

The major characteristics of Coir pith or Cocopeat have been added here:

• Excellent water holding ability, for example, 6-8 times its weight
• Excellent moisture retention capacity
• Slow degradation because of the lignocellulose bonding
• High porosity, stores, and ability to deliver nutrients for a long duration
• Proper aeration/oxygenation capacity and enhanced root penetration
• Acceptable Electrical Conductivity (EC), Cation Exchange Capacity CEC), and pH
• 100% degradable, organic, and renewable material

It is more appropriate for growing plants like farming and agriculture. Plenty of greenhouses keep this for the cultivation of flowers, vegetables, fruits, medicinal and ornamental plants, etc. across the world.

Market potential of Cocopeat or Coir pith Making Business

About two-thirds of the world’s production of coir and coir products are done in India. Although India has an extensive coastline with coconut palms, the emergence and economic advantages of the coir industry is there for major coconut growing provinces and Union Territories, for instance, Kerala, Andhra Pradesh, Tamil Nadu, Maharashtra, Karnataka, Assam, Goa, Orissa, Andaman & Nicobar, Pondicherry, Lakshadweep, etc. It gives employment (mostly part-time) to about 5.5 lakh people. It witnesses the exports of around Rs. 70 crores.

Coconut husk is the primary raw material for coir products. About 50 % of the available coir husk is meant for coir products. Hence, we can witness the great scope for the coir industry in the coming years. Kerala is the hub for the Indian coir sector, particularly white fiber, accounting for 61% of coconut production more than 85 percent of coir products.

The market estimate for husks consumed is about Rs 259.36 crore – Rs 315.12 crore. It is projected to have 1,27,824.62 lakh husks to get the fiber that costs to be Rs. 913.03 crore – Rs. 1,109.34 crore yearly. 539815-ton fibers are used domestically in our country.  The coir fiber used accounts to be 28.41%. It has the prospective to make the income of Rs. 3,135.54 to Rs 4,221.44 crore every year.

The three products Coir pith or Cocopeat, fibers, and yarn have a huge requirement in the market and before starting the beginning itself, if proper marketing and brand promotion are done, the company could get bookings from popular bio fertilizer companies to get tons of Coir pith or Cocopeat. With channels and connections in the market, the firm is could get many orders after launch.

Even the yarn, has a good international market and is used in Tamil Nadu, Andhra Pradesh, Karnataka, Rajasthan, etc. Thus it is essential to get collaborations with exporting firms and marketing firms in other states to advertise the product. For the fiber, the bed and pillow manufacturer, sofa manufacturing companies are definitely in a queue for it. It’s a good decision if you want to plunge into this segment and tap the market with your products.

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List of products obtained from Coir pith or Cocopeat

The firm is deemed to obtain the following products through coir.

1) Coir pith or Cocopeat – It forms a remarkable soil conditioner and is extensively used as a substitute for soil-less medium especially in farming and horticulture methods. Because of its moisture-holding qualities, Coir pith or Cocopeat is perfect for growing anthuriums and orchids.

2) Yarn (of different sizes) – It is widely used in the manufacture of carpets, rubber-based brush mats, Geo-textiles, mats, etc.

3) Fibre – It is normally filled up in pillows and mattresses. Used for cushioning purposes, insulation, and even for packing.

All the above products are used widely and in various markets.

Legal formalities required for starting Cocopeat Making Business in India

Legal formalities for business include license, registrations and permissions required to start Cocopeat Making Business in India. Below is the list:

• Registration of Firm
• GST Registration
• Trade License
• MSME/SSI Registration
• EPF Registration
• ESI Registration
• Trade Mark
• IEC code
• Shop act license
• NOC: No Objection Certificate

Raw materials required for starting Cocopeat Making Business

The raw material required to start the business is very cheap and is available in plenty. Coconut shells are the major raw material required to start the business. These are dried and used for starting the business. Coir, being the natural fiber is obtained from Coconut husk. Coir industries became famous because of the abundance of raw material in local districts.

Machinery/Equipment required to start Cocopeat Making Business

We can include the important equipment required for the business in the following section.

• Beater
• Pith screener
• Fiber screener
• Pith conveyor
• Fiber conveyor
• Husk conveyor
• Beater suit
• Fiber bailing press
• Automatic double head machines
• Willowing machines

Manufacturing process of Cocopeat

Coir Fibre: The main raw material (coconut husk) is obtained from the farms and stored. The aggregated husk is submerged in water. Now, the soaked material is added into the decorticator which separates the fiber from the pith. The fiber is now dried under sunlight and is pressed in the form of 35-Kg bundles by the balling press and transported for sales.

Coir Yarn: Coir yarn spinning is same as the cotton yarn spinning. The process takes place in four steps stated below.

• Willowing
• Slivering
• Spinning
• Winding

Coir fiber is obtained from fiber extraction factories is moistened by spraying water. After 2-3 hours, the wet fiber is sent through the willowing machine to separate the impurities and then the fiber is placed parallel to each other. The fiber is then introduced into a slivering machine to get the sliver form. The slivers are spun into yarn based on specifications set in the spinning machine. The yarn is now cleaned and formed as rolls to make them ready for the market.

Coir pith or Cocopeat Block: The by-product obtained after the Coir Fibre Extraction process is Coir pith or Cocopeat. The raw Coir pith or Cocopeat (high EC) is obtained and washed using soft water to decrease the EC.

This low EC pith is now dried thoroughly in the yard and later it is sent to the sieving machine for processing further. The resultant pith is introduced into the compacting machine where the pith is transformed into blocks. Now the blocks will be sent for packaging and then ready for distribution to sales. The various products obtained are cocopeat block, cocopeat briquettes, cocopeat tablets, etc. Now, let us get into the details of economics or cocopeat making project report.

Cocopeat Making Project Report/Economics of Cocopeat Making Business

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a. Land and building

Land: Rs. 16,50,000

Work shed: Rs. 4,50,000

Total: Rs. 21,00,000

b. Machinery & Equipments:

Grow Bag Machine: Rs. 27,70,000

Screener, Conveyor, Vibrator: Rs. 8,80,000

5Kg Machine: Rs. 17,50,000

Screener, Conveyor, Vibrator: Rs. 8,80,000

Total: Rs.  62,80,000.

Working Capital: Rs. 10,00,000

Preliminary and peri-operative expenses: Rs. 1,00,000

Cocopeat Making Project Report – Total project cost details

Fixed Capital = a + b = Rs. 21,00,000 + Rs. 62,80,000 = Rs. 83,80,000

Working capital: Rs. 10,00,000

Preliminary and peri-operative expenses: Rs. 1,00,000

Total: Rs. 94,80,000.

Means of Finance

Own Investment/Equity: Rs. 5,69,000

Term Loan: Rs. 58,66,000

Working capital loan: Rs. 9,50,000

Subsidy: Rs. 20,95,000,

Sales Revenue

Cocopeat price per unit: Rs. 11,000

Production: 900 MT

Tax: Rs. 11,25,000

Total sales per annum: Rs. 1,10,25,000

Raw material requirement per annum: Rs. 58,50,000.

Utilities per annum:

Power/electricity: Rs. 1,95,000

Water: Rs. 12,000

Transport: Rs. 60,000

Total: Rs. 2,67,000.

Salaries/Wages: Rs. 12,36,000

Repairs and Maintenance: Rs. 75,000

Selling and Distribution Expenses: Rs. 2,52,000

Administrative Expenses: Rs. 1,22,000.

Total cost of production = Rs. 58,50,000 + Rs. 2,67,000 + Rs. 12,36,000 + Rs. 75,000 + Rs. 2,52,000 + Rs. 1,22,000 = Rs. 87,47,000.

Profit in Cocopeat Making business

Profitability per annum = Total sales per annum – Cost of producing = Rs. 1,10,25,000 – Rs. 87,47,000 = Rs. 22,78,000

Depreciation: Rs. 8,47,000

Income tax: Rs. 1,63,000

Total: Rs. 10,10,000

So, Net profit = Rs. 22,78,000 – Rs. 10,10,000 = Rs. 12,68,000.

That’s all folks about cocopeat making project report and cocopeat making business plan.

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