Sesame Oil Manufacturing Project Report

Sesame Oil Manufacturing Project Report, Business Plan

Introduction

Hello friends, today we are here with a new topic called ” Sesame Oil Manufacturing Project Report and Business Plan”. Sesame oil is derived from the seeds of the plant referred to as “Sesamum indicum”. It has several health benefits. It is desired by numerous health-conscious individuals. It is extracted from sesame seeds and has several antiviral, antibacterial, and antioxidant characteristics. As a result, the oil is even used for therapeutic preparations. It is best for hair and skin. Sesame oil is also generally used for cooking in Asian and Middle Eastern regions. Being native of Africa and Asia, it’s primarily grown in India and China.

Sesame oil is extracted using the seeds of the sesame plant either by cold-press or oil-refining process. It is a yellow-colored semi-drying fatty oil that is rich in antioxidants and popular in anti-inflammatory properties. Hence, it finds its usage in food and personal care merchandise manufacturing. It is also an ingredient in the cosmetic pharmaceutical, and soap industries.

The sesame oil industry is evaluated as per the market demand at $7.7 billion in 2020. It is predicted to attain $11 billion by 2024, depicting a healthy CAGR of 5.9% during this forecast period.

Nutrients and health benefits of Sesame Seed Oil 

Sesame seed comprises around 50 wt% oil. Sesame oil includes fatty acids such as linoleic acid (41%), palmitic acid (8%), oleic acid (39%), stearic acid (5%), and other components in small measurements. 

Around 14.8 mL (1 tablespoon) of Sesame oil includes about 120 calories. Sesame oil also has 40 mg of omega-3 fatty acid for each tablespoon of oil. This is a vital fatty acid that must be procured from food. According to research done in various countries, it is established to aid in reducing the risk of arthritis and other inflammatory issues. The sesame oil even includes phytosterols. This is a plant-derived fatty compound that shares the same structure as cholesterol. It lowers cholesterol absorption into the blood to 50% according to few research institutes.

Phytosterol can also assist to reduce the blood level of LDL, which is known to upsurge the risk of coronary disorders if the blood level is too high.

Uses of Sesame Seed Oil

Sesame Oil is widely used as a traditional cooking oil in Chinese cuisines and in Japan. Apart from cooking, this oil is even used in the manufacture of soaps, in cosmetic and skincare sectors, pharmaceuticals industries, and lubricant preparation.

A guide to Sesame Oil Manufacturing Project Report and Business Plan

Market potential of Sesame seed oil

In terms of income, Europe is the most potential place to sell sesame oil. It is projected to have more than 25% of the total global income during the period 2017-2022. During the same years, the Asia Pacific region will evolve as the second-largest market to this industry. The shops will sustain to be the rapid and expanding sales channel for sesame oil. Depending on the end-user, the retail segment could be the most attractive segment for sesame oil. This segment will observe the highest CAGR.

Sesame oil is a versatile product in this business. It finds its usage in cooking, manufacturing beauty items, and other medicinal products. This increases its popularity in various market segments. It is also known as the oldest edible oil used by people. Its usage is maximum when compared to all other essential oils. It also has several health benefits which attract people who are health-conscious. The demand for sesame oil is projected to sustain in the coming years as well.

Registration, license, and registration for Sesame Oil Manufacturing

Sesame oil is also used for cooking purposes. Also, business demands several registrations and approvals before starting only. These licenses are also dependent on the location which you have chosen for beginning the plant. However, it is recommended to approach local small business experts in that business and tax consultants for a clear picture of the exact approvals required.

• The most essential one is to register your business based on the management pattern.
• Next is to get the MSME Udyog Aadhaar available through online registration.
• Also, a trade license is essential to obtain from the local municipality.
• The business is classified under the food Industry and thus it should comply with the FSSAI norms. The Food Standards and Safety Guidelines ( 2011), and laws made under IS 544: 1968 allow the inclusion of antioxidants in de-hulled sesame seeds production to enhance the oil shelf life.
• Even GST registration is mandatory for any business and here also it is needed.
• Then acquire the BIS certification. The product should be in accordance with the guidelines laid by PFA Act.
• In any kind of business, it is important to check the tax liabilities for sesame oil-making business.
• AGMARK certification
• Acquire Fire license
• Verify the Mandi Act 
• Check the Labor Laws such as ESIC, EPFO, etc.  

Land and building required to start Sesame Oil Manufacturing Business

Sesame Seed Oil Manufacturing Business requires 200 sq. meters land in which 100 sq. meters could be the built-up area needed for operations, packing and storage of raw materials and end products. The land can be purchased in Rs. 1, 00,000/- approximately, and construction can be completed in Rs. 4.50 lacs.

Raw materials required to start Sesame Oil Manufacturing Business

In case if you miss this: Vermicompost Project Report.

The major raw material is the quality sesame seeds. The annual production of sesame seed for a state is approximately 1, 50,000 tons. The sesame seeds can be obtained only for some months being a seasonal crop and hence factory will be working for 240 days in a year. Oil can be packed using either plastic container sheets of different sizes or polythene. Also, the residual de-oiled cake is packed in second-hand gunny bags. 

List of machinery required to start Sesame Oil Manufacturing Business

To attain the processing capacity of 200 tonnes with 240 working days in a year, the below-stated equipment is essential:

• Oil expellers having a long heating kettle, other accessories, and electrical
• Filter press having plunger pump, filter cloth, etc.
• Weighing scale
• Mini Boiler
• Shaker screen with blower
• Oil storage tanks etc.

Miscellaneous assets required to start Sesame Seed Oil Manufacturing Business

Other essential stuff such as furniture and fixtures, working tables, etc. is needed. 

Utilities in Sesame Seed Oil Manufacturing Business

Total power usage could be estimated to be 40 HP along with 1000 liters of water that will be used daily.

The manufacturing process of Sesame Seed Oil

The process for sesame oil manufacturing is summarized in the following section.

Sesame Seed Cleaning

The first stage in the process includes sesame seed cleaning. This assists to avoid dirt, small stones, foreign particles, etc. from the seeds.

Sesame Seed Dry Roasting

Now, the seeds are dried by the roasting process. Once the roasting is complete, they are sent for crushing. Sesame seeds are heated now to eliminate the extra moisture from them.

Sesame Seed Pressing

After the moisture is eliminated, the seeds are pressed. This process is done by sesame oil expeller press. The press will produce the oil from seeds. The oil is kept aside for some duration for settling.

Crude Sesame Oil Filtration

After seed pressing is completed, there may be some pieces of oil cake is left over in the sesame oil. This is removed by oil extraction filters. This step is also crucial before processing the oil for the next step called refining. 

Sesame Oil Refining

After this step of oil extraction called Refining, the oil will be free from various impurities.

Sesame Oil Packaging

The essential and last step of oil extraction is the packaging. Sesame oil is packed in desired quantities and sent to the market for selling.

Sesame Oil Manufacturing Project Report / Economics of Sesame Oil Manufacturing Business

• Land and Building: Rs. 5,50,000

Sesame Oil Manufacturing Project Report – Plant and Machinery

• Oil expellers complete with long heating kettle, other accessories and electrical: Rs. 5,00,000
• Filter press with plunger pump, filter cloth, etc.: Rs. 2,50,000
• Mini Boiler: Rs. 11,50,000
• Shaker screen with a blow: Rs. 50,000
• Weighing scale. Oil storage tanks etc.: Rs. 2,00,000
• Total: Rs. 11,50,000
• Miscellaneous Assets: Rs. 1,50,000
• P & P Expenses: Rs. 1,50,000
• Contingencies @ 10% on Building and plant and machinery: Rs. 1,70,000
• Working capital margin: Rs. 3,30,000
• Total: Rs. 25,00,000

Sesame Oil Manufacturing Project Report – Means of Finance

• Promoters’ contribution: Rs. 10,00,000
• Term loan from Bank FI: Rs. 15,00,000
• Total: Rs. 25,00,000
• Debt Equity Ratio: 1.5:1
• Promoters contribution: 40%

Sales Revenue at 100%

• Sesame oil: Rs. 1,16,00,000
• De-oiled cake: Rs. 42,00,000
• Total: Rs. 1,58,00,000

Sesame Oil Manufacturing Project Report- Profit in Sesame Oil Manufacturing Business

• Installed capacity: 200 Tonnes
• Capacity Utilisation: 60%
• Sales Realisation: Rs. 94,80,000

Sesame Oil Manufacturing Project Report – Cost of Production

• Raw material & Packing materials: Rs. 61,50,000
• Utilities: Rs. 1,50,000
• Salaries: Rs. 4,00,000
• Stores and Spares: Rs. 60,000
• Repairs and Maintenance Rs. 30,000
• Selling Expenses @ 25%: Rs. 4,62,000
• Administrative Expenses: Rs. 60,000
• Total: Rs. 73,12,000
• Profit before Interest & Depreciation: Rs. 21,68,000
• Interest on Term Loan: Rs. 1,80,000
• Interest on Working Capital: Rs. 1,54,000
• Depreciation: Rs. 1,60,000
• Net Profit: Rs. 16,74,000
• Profit after tax: Rs. 15,07,000
• Cash Accruals: Rs. 16,67,000

Break Even Point Analysis

• Sales: Rs. 94,50,000

Variable Costs

• Raw and Packing Material: Rs. 61,50,000
• Utilities (70%): Rs. 1,30,000
• Salaries (60%): Rs. 2,94,000
• Stores and Spares: Rs. 75,000
• Selling and Distribution Exps (70%): Rs. 4,03,000
• Administration Expenses (50%): Rs. 30,000
• Interest on WC: Rs. 1,92,000
• Break even cost analysis: Sales – Variable Costs = Rs. 21,76,000
• Fixed Costs: Rs. 5,73,000
• Break Even Point: 27%

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