Profits in Coconut Oil Making Business (Cost to Start)

Introduction to coconut oil making business profits and the cost to start it

Coconut palms are prominently found in coastal areas of India. The dried kernel of coconut is famous as copra. This is an industrial word used commonly. Copra is the main commercial product of coconut the oil content varies from 65 to 72 percent. There is another term for it called ‘virgin coconut oil.’ Virgin coconut oil is derived from the extraction of the fresh coconut (not from copra). If you are dwelling in a coconut growing area, you may begin the coconut oil manufacturing business.

Ideas to start and make profits in coconut oil making business

There is another type of coconut oil, named RBD coconut oils. RBD stands for bleached, refined, deodorized. The “bleaching” is usually not a chemical process, but rather a basic filtration step to remove contaminations. A “bleaching clay” is used for filtration. Here in this blog, we plan to explain how to start a coconut oil manufacturing business from copra.

Coconut oil manufacturing – market potential

Coconut oil is an essential cooking medium in Southern regions of the country, particularly in Kerala and Karnataka State. Besides, oil has diverse industrial uses. It is used for the manufacture of laundry soaps, toilet soaps, surface active agents and detergents, massage oil, hair tonics, cosmetics, hair oil, etc. Growing in tropical places coconut has an international market opportunity.

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Market scopr for coconut oil.
Market scopr for coconut oil.

The major consumer of coconut products, specifically coconut oil and copra, is the United States. Among the European Union countries, the Netherlands serves as the main port for the import of these goods, which are then spread to various countries. Refined coconut oil has a huge demand in France and Germany, with its varied uses in the cosmetics industry. Therefore, we may infer that coconut oil making is a money-making business platform for new entrepreneurs.

Registration, license, and registration for coconut oil manufacturing business

Coconut oil is also used as a food product. And the business requires various registrations and licenses before beginning only. These requisites are mainly based on the location where you are planning to initiate the unit. However, it is suggested to contact local small business professionals and tax consultants.

  • Primarily, you must define the management design of your organization. And then as per the design, register your business.
  • Firstly, apply for MSME Udyog Aadhaar which is available as online registration.
  • Then, the important trade license from the local municipality should be applied.
  • The business comes under the food Industry category and requests consent from FSSAI which is also done online.
  • Nowadays it is a must to apply for GST registration.
  • Try to create a current account in any of the nearby banks.
  • Then it is important to apply for the BIS certification. The Bureau of Indian Standards specification for the product is IS 966:1962. The product must also conform to the PFA Act, guidelines
  • Moreover, it is essential to check the tax liabilities as well for this business.

Machinery for coconut oil manufacturing business

Some of the equipment is needed for various aspects. The machinery is needed for the manufacturing process, also based on the raw material used, the particulars of the required output, and the investment potential of the owner. Here we have noted down few common machines needed for coconut oil manufacturing.

  • Copra Cutter
  • Bucket elevator
  • Steam jacketed kettle
  • Oil expeller
  • Screw conveyor
  • Crude coconut oil storage tanks
  • Filter press
  • Microfilter
  • Filtered oil storage tanks
  • Volumetric filling machine
  • Baby boiler
  • Wooden storage drums

Properly dried copra with a moisture content not more than 6% is the perfect raw material for coconut oil manufacturing. Usually, the quality of the coconut oil mainly based on the quality of copra.

Coconut oil manufacturing process

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Raw coconut.
Raw coconut.

Firstly, the edible oil is extracted from matured contents (or) kernel which is harvested from the coconut palm. Below you will have some of the basic steps involved in making virgin coconut oil.

De-husking of coconut

In this step, by using the coconut de-husking machine, the husk is detached manually.

De-shelling of coconut

In this stage, the coconut shell is separated without breaking the kernel.

Paring of coconut

In this stage, using a paring machine the brown skin of the kernel is removed.

Blanching of coconuts

In this fourth step, the pared coconuts are properly dipped in boiling water for some minutes in a blanching tank.

Draining of coconut

In this next step, the extra moisture content that is present during the blanching process is then removed using the draining process by using a vibratory screener.

Disintegration process

In this step, the pared nuts are sliced into tiny pieces and fed to a disintegrator to make it ready for the extraction process.

Extraction of the milk

Here the milk extractors – screw press (or) hydraulic press contain shredded coconuts and the extractor oozes out the coconut milk. In case any solids (or) large particles are there then the extracted coconut milk is filtered to remove them.

Centrifugation

In this stage, for separation of the two immiscible substances centrifugation is done. The coconut milk basically a natural oil in the emulsion of water. Therefore, coconut oil and coconut skim milk is separated post centrifugation.

Filtration of the crude extract

Filtration is performed in the last step and this is the final step for how to make virgin coconut oil. In this step, the coconut oil is sent through a filter and later packed in the consumer packs. The extra moisture present in coconut oils is taken out by the vacuum dehydration of oils.

Investment or cost to start Coconut oil making business

To initiate the coconut oil making business, you need to arrange the finance about from Rs. 2 lakhs to Rs. 5 lakhs.

The coconut oil making machine price ranges from Rs. 80,000 to Rs. 3,00,000 which depends upon the capacity.

The raw materials cost is Rs. 1,00,000.

Profits in coconut oil making business

You can earn good profits in coconut oil making business. You can make 35 to 40% of profits in coconut oil making business.

How to sell your coconut oil

You can sell your coconut oil in local markets or you can even sell in the medical stores. You can also register in B2B websites and B2C websites in online markets to promote coconut oil products.

You can also sell your products in supermarkets, small stores in shopping malls, etc. Advertise about your product through social media to get a huge number of clients in this way you can increase and promote your business. Even though there are several coconut oil manufacturers in India, but the demand for encouraging the new product is also high because of its medicinal properties. So, you need not worry about the market. You can sell your product based on the coconut oil wholesale price in India.

To reduce input costs and get more profits in coconut oil making business, you can start commercial Coconut Farming.

7 COMMENTS

  1. Hi Josephine, I am also exploring option on starting coconut oil business in kerala. Would be good to connect with you to share our findings.

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