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Groundnut Oil Manufacturing Project Report

Groundnut Oil Manufacturing Project Report, Business Plan

Introduction: Hello friends, we are back with a new topic of “Groundnut Oil Manufacturing Project Report”. The groundnut or peanut belongs to the family Fabaceae (commonly referred to as a bean, pea, or legume family). Groundnut oil, also famous as Peanut oil or Arachis oil is a mild-tasting vegetable oil manufactured using peanuts. Groundnut oil appears in light yellow and is a transparent edible oil with clear color and texture, pleasing fragrance and nice taste, and gets digested easily.

Groundnut oil comprises more than 80% unsaturated fatty acids (comprising around 37.6% linoleic acid and about 41.2% oleic acid). It also includes 19.9% of palmitic acid, arachidic acid, stearic acid, and other unsaturated fatty acids. The fatty acid composition of peanut oil is comparatively more, hence can be digested and absorbed easily by for human intestine. Groundnut is an annual herbaceous plant that reaches around 1.0 – 1.6 ft on an average in height. The leaves are pinnate with flour leaflets and opposite. Peanuts include around 45-52% oil content when compared to other oilseed crops.

A guide to Groundnut Oil Manufacturing Project Report, and Business Plan

Groundnut Oil Manufacturing Project Report, and Business Plan
Groundnut Oil Manufacturing Project Report, and Business Plan (Image credit: pixabay)

Market potential of Groundnut Oil Manufacturing Business

The global groundnut oil market is having a high level of competition within the present companies. As we cannot find any exclusive functionality of groundnut oil if compared to other vegetable oils, the demand is predicted to remain stagnant in the coming years.

Peanut oil is an edible vegetable oil obtained from peanuts. The peanut oil market size can raise by USD 1.90 billion between 2020-2024, and the market’s growth will drive the demand during the forecast period.

Peanut or groundnut oil is a deep-rooted product and in use for years traditionally in many Asian recipes and their cuisines. It is employed as cooking oil and even to endorse the flavor of the food item.

Uses of Groundnut Oil

Groundnut oil plays an important role in reducing plasma cholesterol levels as it converts the body’s cholesterol into bile acids which get later excreted.

  • Moreover, peanut oil also comprises sterol, phospholipids, wheat germ phenol, vitamin E, choline, and other healthy substances for humans.
  • Regular intake of peanut oil can avoid the natural skin wrinkles which develop with aging, protect the blood vessel wall, avoid thrombosis, aid prevent atherosclerosis and heart disease.
  • The choline in peanut oil can enhance the memory of the human brain and lowers brain-related disorders.

Business plan for starting a Groundnut Oil Manufacturing Business

If you think of starting any kind of business or production unit, you need to first design a perfect business plan. The list of things required to craft or design a perfect business plan for the Groundnut Oil Manufacturing Production Unit is mentioned below-

  • List of licenses, registration
  • Area required
  • Implementation schedule of the project
  • Raw materials required
  • Machinery required
  • Production process
  • Estimated cost and
  • Profit analysis

List of licenses required to start the Groundnut Oil Manufacturing business

Before starting the groundnut oil-making business, you need to make a list of licenses, permissions, and registrations required to start the Groundnut Oil Manufacturing Business in India.

  • Registration of firm
  • MSME registration
  • GST registration
  • ROC
  • Shop Act License
  • FSSAI License
  • IEC Code
  • Export License
  • Fire and Safety
  • ESI
  • PF
  • No Objection Certificate from pollution board
  • Trade license from the local municipal authority

Area required to start Groundnut Oil Manufacturing Unit

To establish a Groundnut Oil manufacturing production unit, you need to rent or own space of 1200 – 1500 Sq.mts. As you need to build and set up a Groundnut oil plant unit in India. The oilseed cake produced is also collected and packed as it can be used as animal feed. You also need to set up a godown for storing the packaged oil and for raw materials also.

Raw materials required to start Groundnut Oil Manufacturing Unit

Groundnuts are the chief raw materials needed for Groundnut oil manufacturing. Groundnuts have a high nutrient value, hunger-satisfying property, and are considered low-glycemic snacks. Groundnuts in India are cultivated around the year because the farming is performed as a two-crop cycle harvested in March and October. Ground Nuts are essential protein crops in India grown best under rain-fed conditions. Other than this plastic bottles and caps are necessary for groundnut oil packaging.

List of machinery required to start Groundnut Oil Manufacturing Unit

  • Vibratory Precleaner machine
  • Cross Tube Boiler
  • Groundnut Decorticator Machine
  • Bottle filling machine
  • Groundnut oil expeller
  • Oil Filter Press
  • Other machinery and equipment, for instance, oil collection tank, screw conveyor, pump, bins, etc.

Implementation schedule of Groundnut Oil Manufacturing Unit

  • Preparation of Project profile – 1 week
  • Acquiring all the licenses required – One month
  • Financial/Loan from Banker or Financial Institutions – Two months
  • Power connection/Building construction – Six months
  • Machinery procurement and Trial run – Two months
  • Recruitment of Staff and Labour – One month
  • Actual commercial production – One month

Manufacturing process of Groundnut Oil in Production Unit

In case if you miss this: Vermicompost Project Report.

Raw Groundnut
Raw Groundnut (pic source: pixabay)

Step 1: The complete seed of Groundnut is referred to as a pod and has 1-5 kernels, which grow underground in a needle-like structure know as a peg. Firstly, the healthy and mature seeds of groundnut are procured from the reputed vendor and stocked.

Step 2: Later, foreign impurities such as metal, husks, plastics, etc. are separated from the kernels by workers.

Step 3: Next, keep the kernels above the vibratory pre-cleaner machine that cleans the kernels and removes sand, dust, and stone particles. The gyratory vibrations are considered the main principle for the Vibro sifter machine. Here, the separation takes place because of particle size. Once the motor gets energized, due to vibration, the particles travel across the screen/sieve based on their particle size.

Step 4: After this step, the cleaned groundnuts are introduced into a Groundnut Decorticator Machine through screw conveyors. Decortication of groundnut is difficult and time taking process. Groundnut decorticator is functions based on shearing action, blowering action, and separating action. Here, the groundnuts are first added to the machine. Then groundnuts pass through two elements, one is a semi-circular net and the next is a roll shaft with a soft wooden core.

Step 5: A semi-circular net is stationary whereas the roll shaft of wood will rotate. When the groundnut comes in contact with them because of the shearing action the groundnuts get shelled and splits into two parts and we have the kernels and outer shell of the groundnuts. Now clearance is done between the net and roll shaft.

Step 6: The kernels must be prepared for high-quality oil recovery done by a process called pressing. This is done by optimizing the moisture content and temperature (about 90 – 95℃) for about 30-60 minutes. This process will use the outer shells of groundnuts which we have obtained in the previous stage are added to the cross tube boiler and burned to obtain steam. This steam is further used to heat the kernels and extraction takes place. Kernels are kept in containers and steam is passed at controlled parameters like pressure to treat the kernels.

Step 7: In the next step, the kernels are placed in an oil expeller. The steam is even sent through the expeller to optimize the temperature needed for oil extraction. The oil expeller crushes the peanut seeds and then extracts the oil. The oil extracted is gathered in the containers. The oil cake obtained after the first compression has some extra oil content. This cake is again added to another oil expeller to extract leftover oil content through the conveyor. Steam is used in the device to uphold the temperature. The extracted oil is placed in the containers.

Step 8: The crude oil extracted after crushing will have impurities. In the next stage, the crude oil is added to the Filter machine. The pump is used to feed the crude oil from the container and transfers the oil to the filter cloth. The filter cloth will absorb the fine impurities present in the oil. The filter oil is sent through the tap integrated to the machine and gathered in the tray. From the machine tray, it is transferred into the container.

Step 9: In the next step, the oil is sent for testing for quality and verified the presence of fatty acids in the edible oil according to FSSAI regulations. After this, the oil is poured into the bottles with proper measurement through an oil filling machine. It is important to make your bottle clean and dry before filling. The caps are mounted carefully and tightly to ensure proper sealing. In the next stage, the expiry date, and other specific information is printed with a printing machine. Printed labels are now added to the bottles. After this, the bottles are ready for sending to the market and can be sold.

Groundnut Oil Manufacturing Project Report/Economics of Groundnut oil making in India

Land and Building: Rs. 5,50,000

Plant and Machinery: Rs. 2,70,000

Miscellaneous Assets: Rs. 55,000

P&P Expenses: Rs. 40,000

Contingencies @ 10% on Land and Building and Plant and Machinery: Rs. 80,000

Working Capital Margin: Rs. 1,35,000

Total: Rs. 11,30,000.

Groundnut Oil Manufacturing Project Report – Means of finance

Promoters’ Contribution @ 25 %: Rs. 2,80,000

Loan from Bank/FI: Rs. 8,50,000

Total: Rs. 11,30,000

Debt Equity Ratio: 1.96 : 1

Promoters’ Contribution: 25%.

Groundnut Oil Manufacturing Project Report – Working capital calculation

Raw materials/ Packing materials: Rs. 1,70,000

Working expenses: Rs. 1,00,000

Finished goods: Rs. 1,00,000

Receivable: Rs. 80,000

Total: Rs. 4,50,000.

Groundnut Oil Manufacturing Project Report – Cost of Machinery

Table Ghani 1: Rs. 70,000

Oil Expellers 2: Rs. 80,000

Filter Press 1: Rs. 60,000

Other Support Equipments, electric motor and testing facilities: Rs. 60,000

Total: Rs. 2,70,000.

Groundnut Oil Manufacturing Project Report – Profit in Groundnut oil making business in India

Sales price of Groundnut Oil: Rs. 32,16,000

Sales price of De-oiled Cake: Rs. 4,44,000

Total: Rs. 36,60,000.

Profits in Groundnut oil making business = Sales – Project cost = Rs. 32,60,000 – Rs. 28,80,000 = Rs. 7,80,000.



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