How to Make Money from Groundnut Oil Production

How to make money from a Groundnut oil production business

Groundnuts originated in South America. They have different names such as earthnuts, peanuts, and goobers. Groundnut oil is edible vegetable oil, extracted from peanut kernels that are rich in antioxidant vitamin E. Groundnut oil is one of the healthiest cooking oils as it is low in saturated fats, rich in essential fatty acids, free from cholesterol. These oils are less refined than other oils to retain the peanut protein for nutrition and taste.

Ideas to start and make money from a Groundnut oil production

Business plan for the production of groundnut oil to make great money

The first step is to create a business plan and project report before starting the business. The report includes the details of cost, expenses, capital, financial strategies, plant, and equipment. Before heading into the business structure investigate the market for groundnut oil in nearby areas.

Setting a location for groundnut oil mill plant

The right location must be chosen to set up the groundnut oil mill plant. Groundnut oil has huge demand in the market which requires an effort to promote the brand which is created. The location of the mill plant must be near to the retailers, manufacturers and this can decrease the transportation costs.

Arrange the finance

The finance for the groundnut oil manufacturing business can be obtained from banks or financial institutions. If one has their own funds then they can use it as well. The investment may require huge capital, so it is better to enquire about finance before starting the business.

Set up plant and machinery for the production of groundnut oil to make money

The machinery required for manufacturing groundnut oil is listed below:

  • Cleaner for cleaning the seeds
  • Peanut sheller
  • Peanut crushing machines
  • Roller crusher
  • Steamer
  • Cans and trays for handling oil seeds
  • Solar dryer
  • Screw types Mechanical oil expeller
  • Filter press
  • Steel drums for storing the oil
  • Bottle filling machines

Registration and license for setting up a groundnut oil processing plant

The groundnut oil manufacturing business is started after selecting the kind of business association. There are various kinds of business associations like Sole ownership, one man Company, Partnership Firm, Limited Liability Corporation (LLP), and Company. The small scale business can be started by picking Sole ownership as it requires a small amount of capital. The registration of the business isn’t required in a sole ownership type of business but trade license is mandatory. The business can be expanded depending on the capital necessities. However, the business must be registered and in addition, immense filings must be finished for expanding it into private limited or public Company. The incorporation of the company is done by the Register of Companies ROC. The application along with documents, declarations, and reports must be sent to ROC. The ROC will check all the records and register the Company. The registration of the organization should be done according to the provisions of Companies Act and Rules, 2013.


In establishing a groundnut oil production unit, We need to obtain several different licenses and registration from different Government authorities.

  • Trade license
  • SSI registration
  • Food operator license
  • BIS certificate
  • No Objection Certificate from Pollution Control Board
  • AGMARK Certification
  • Fire license

An extraction procedure and manufacturing of Groundnut oil

In case if you miss this: How to Make Money from Moringa Powder Production.

An extraction procedure and manufacturing of Groundnut oil.
An extraction procedure and manufacturing of Groundnut oil.

There are different methods available, but the most popular method is by mechanical squeezing. The remaining oil can be extracted by solvent extraction, but it is mostly used in large scale businesses. However, solvent extraction is more suitable for large scale business than small scale businesses. In this way, mechanical squeezing innovation is increasingly adaptable on a small and medium scale. For the most part, the groundnut oil creation process contains three essential stages. These are seed preparation, squeezing, and crude oil refining.


The seed requires experiencing an intensive cleaning procedure to expel sand, tail, plant flotsam, and jetsam and some other remote issues by rotating or table sifter. In the wake of cleaning, the seeds are prepared for effective oil recuperation by squeezing.  The equipment such as magnetic separator, self-regulation vibrating sieve can be used.


The groundnut shells are removed in this process by a Peanut Sheller. This will increase the oil yield and improve the quality of the oil.


Few groundnut production plants may undergo grading to separate the small peanuts and large peanuts. This is because they go for different treatments for different sizes of peanuts. This process is an optional one.


By using peanuts crushing machine the red skin on the peanuts is removed. The peanuts are crushed by the same process. The large size is crushed into small size peanuts.


The peanut rolling machine is used to roll the peanuts, which is between two rollers. Due to the force between two rollers the shape of the peanut is changed to shorten the oil path.


The steam cooker is used to adjust the moisture by changing the temperature. By this, the oil extraction rate can be improved.

Oil pressing
The steamed peanut is then pressed by a peanut oil pressing machine. Due to mechanical force, the crude peanut oil is obtained.

Filtering the crude oil

By using filter machines the oil is filtered to clear the oil from impurities.

Refining the crude oil

The filtered crude oil may contain oil-soluble or non-oil soluble impurities. So the production plant with professional oil refinery equipment is used to get refined high-quality peanut oil.

The resultant groundnut oil is packed into bottles or plastic covers.

The cost to start a Groundnut oil production unit

The standard fundamental groundnut oil extraction business surely requires huge capital. The greater part of the capital will be spent on renting an office and furthermore in buying fundamental oil extracting and preparing machines. The key areas where the startup capital is spent are listed with prices below:

  • Premises ( rented ) – Rs. 2,00,000 to Rs. 2,60,000
  • Registration, licenses and taxes for manufacturing Groundnut oil – Rs. 1,00,000 to Rs. 1,50,000
  • Insurance – Rs. 20,000 to Rs. 50,000
  • Plant and equipment for manufacturing groundnut oil – Rs. 2,00,000 to Rs. 2,50,000
  • Operational costs such as staff salary, payment of bills, etc – Rs. 60,000 to Rs. 80,000
  • Inventory such as raw material, drums, bottles, etc – Rs. 2,00,000 to Rs. 3,00,000
  • Marketing and promotion expenses- Rs. 50,000 to Rs. 70,000
  • Any miscellaneous expenses- Rs. 30,000 to Rs. 50,000

You may also check this: How to Make Money from Cardamom Oil Manufacturing.

Cold-pressed groundnut oil

The other form of extracting oil from groundnuts is by cold pressing the seeds. Cold pressing is the method of extracting the oil from seeds without using the heat to extract that may degrade the flavor and nutrients of the oil. In olden days the cold-pressed procedure is followed. The cold-pressed groundnut oil should not be used in huge quantities for cooking.

Pricing strategy of produced groundnut oil

The pricing trend in the essential oil extraction business is required to produce various product sizes. The costs will fit in with what is realistic in the business yet will guarantee that inside the initial stages to a year, the items are sold at a lower price than the normal costs of different fundamental oil marks in India. We have to set up business systems that will assist with running on low benefits for a time of a half year; it is a method of urging individuals to become tied up with our basic oil brands.

The raw material for producing groundnut oil

The raw material required for the groundnut manufacturing groundnut oil is shelled groundnuts. The seed gives 45 to 50 % of oil and 50 to 55 % of the meal. There are other raw materials required along with groundnuts such as bleaching earth, packaging consumables, and caustic soda.

The nutritional values in groundnut oil

The one tablespoon of groundnut oil consists of :

  • Calories – 120
  • Fat – 14 grams
  • Saturated Fat – 2.5 grams
  • Monounsaturated fat – 6.2 grams
  • Polyunsaturated Fat – 4.3 grams
  • Vitamin E – 11% of RDI
  • Phytosterols – 28 mg

Groundnut oil production Market potential to make huge money

Groundnuts are considered a popular source of food throughout the world. These oils are used for cooking food and they can be used to make peanut butter. It ranks at the top among edible oils exported from India and is higher in cost. Most other edible oils are priced lower than groundnut oil. Groundnut oil is available in the market is refined and filtered forms. Although filtered oils are nutritionally superior in quality. The size of the global groundnut oil market is about 1,90,000 MT, during FY2013.

Uses of Groundnut oil

  • Healthy fat is contained in the groundnut oil which is believed to be good for consuming.
  • The groundnut oil is good for skin as it contains Vitamin E. It keeps skin young and healthy. The wrinkles, premature aging, and marks can be treated by groundnut oil.
  • The groundnut oil is good for hair to repair the damaged hair and clear dandruff.
  • It lowers the risk of cancer and heart diseases by consuming oil in a regular diet.
  • Groundnut oil consists of enough monounsaturated fats which help in regulating the blood pressure.
  • Due to its laxative properties, one teaspoon of groundnut oil can help in relieving constipation.
  • Groundnut oil consists of linoleic acid which helps in stimulating prostaglandin glands and helps in circulating overall circulation in the body.

The cost of groundnut oil

One must be thinking of manufacturing groundnut oil, but the question arises is how much kilograms of groundnut can produce 1 liter of oil?

We have an answer to this. let us discuss in a detailed way by calculating the costs. To produce one liter of groundnut oil at least 2.5 kilograms of groundnuts are needed. The price of groundnuts with shells is approximately Rs. 60,000 to Rs. 68,000 per ton.

The price of one-liter groundnut oil is Rs. 280 to Rs. 290. The Cost of groundnut oil includes the cost of procurement and processing, cost of raw material, cost of packaging, and cost of production. There are varieties of brands available in the market, but people often get confused about choosing the best brand of groundnut oil. If the question comes arises, which groundnut oil is best? there is a list of brands categorized as top brands :

  • Danna premium Organic Grondnut oil
  • Gramiyum cold-pressed Groundnut oil
  • Indic Wisdom cold-pressed Groundnut oil
  • Puvi cold-pressed Groundnut oil
  • Satvyk cold-pressed Grounut oil
  • Pure and sure organic Groundnut oil

The conclusion to start and make money from Groundnut oil production

Groundnut oil is considered as one of the healthiest oils in the country. It won’t harm in using it as a medicinal purpose, for skin or hair, etc. so it is advisable to do this groundnut oil extraction business and earn huge profits. To reduce the input costs and increase the profits in groundnut oil manufacturing business, you can plan for commercial Groundnut Farming.


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