Starting Peanut Butter Making Business – In India

Introduction to starting Peanut Butter making business in India

Peanut Butter is a paste of peanuts that can be prepared from ground dry roasted peanuts. If you don’t know about the details of how peanuts are made into peanut butter or how peanut butter is processed then this article is a perfect guide to know all the necessary information like what is the most common kind of peanut used in peanut butter, Uses of Peanut Butter, what is the healthiest peanut butter.

A step-by-step guide to starting Peanut Butter making business

In many countries the peanut butter is famous. The following are the types of Peanuts:

  • Runner Peanuts
  • Virginia Peanuts
  • Spanish Peanuts
  • Valencia Peanuts

Among the above types of Peanuts, the “Runner Peanuts” is the most common one. It is uniform in kernel size that permits even roasting.

It is classically grown in the following states such as Texas, Florida, Oklahoma, Georgia, Alabama, South Carolina, etc. 80% of Runner Peanuts are cultivated in the USA.

Business plan to starting Peanut Butter making business

Peanut Butter is a lucrative business to start once the owner knows the primary aspects of starting the business and the registrations including the various licenses mandatory to start the business. 

Registration, license, and permissions required to starting Peanut Butter making business in India

The registrations that must be essential to start Peanut Butter include-

  • Business Entity: The first registration for any business is to register it as a business entity by knowing about the form of the organization. It could be as a sole proprietorship or a partnership or a limited liability partnership or a one-person company. This will help in availing a few benefits to the business and must, therefore, be selected carefully before registering the business at the Registrar’s office.
  • FSSAI registration: Peanut Butter is classified as the processing of food or food products and thus as per the definition requires an FSSAI registration. Food Safety and Standards Authority of India (FSSAI) is meant for protecting and promoting public health by regulation and supervision of food safety hence FSSAI is a mandatory registration/license for the business. The FSSAI registration process is entirely online and quite easy to follow, once the documents are ready. 
  • Shop Act or Trade License: The Peanut Butter making business for example in Maharashtra, India requires applying for a Shop Act License from the local municipal authority to run the business. This license helps manage the working conditions along with working hours, leaves, wages, holidays, etc. of the employees and supports the business to run smoothly.
  • Udyog Aadhaar Registration: The Peanut Butter is categorized as a small business and hence it must be registered under Udyog Aadhaar which is a registration and recognition for MSMEs- micro, small, and medium enterprises. 
  • GST Registration: Every business, including the Peanut Butter, should associate with taxes at some point and for monitoring a single uniform taxation structure, the business should get a common GST number which stands for Goods and Service Tax.
  • BIS certification: Apart from these registrations the business should get BIS certification as well as tax liabilities. 
  • No Objection Certificate from State Pollution Control Board: The Peanut Butter doesn’t cause any pollution so no clearance is needed, however, it is recommended to check it with the State Pollution Control Board of the locality where the business is established.

Equipment and essentials required for starting Peanut Butter making business in India

The basic requirement when you plan to start Peanut Butter business is ‘equipment’. Equipment is mandatory for Peanut Butter without which the business is not possible. The basic list of equipment, machinery, and materials required for Peanut Butter are mentioned below (taking into account all the types of flour mills)- 

  • Availability of transportation provision
  • Power provision
  • Water availability
  • Semi-skilled manpower
  • Drainage facility
  • A minimum area of 3000 sq. ft for arranging a small scale unit with the entire product range. However, for a basic mill, a smaller area could be used.

Equipment such as

  • Bucket elevator
  • Reel machine (3 segments)
  • Rotary separator with aspiration channel
  • Scourer machine with aspiration channel
  • Intensive dampener
  • Rotameter
  • De-Stoner
  • Indent cylinder
  • Screw conveyor
  • V-Groove, Couplings, Pulleys, V-Belts, etc
  • Weighing scale
  • Dust cyclone
  • L.P fan for cleaning
  • Magnate
  • Silogate
  • Roller Mill body
  • Roll Grooving & spindle cutting
  • Purifier
  • Super cyclone

How Peanut Butter is processed?

Peanut Butter Making Process
Peanut Butter Making Process (Pic Source: Pixabay)

The peanuts often contain an additional ingredient that changes the taste, texture such as the following: sweeteners, emulsifiers, and salt. The following are the simple steps of how peanuts are made into peanut butter.

Step – 1: Firstly, you must pre-clean the groundnuts

Step – 2: Secondly, you should remove the shell of the ground nuts

Step – 3: Thirdly, you must grade the ground nuts

Step – 4: After that, you have to perform the roasting

Step – 5: Then after, you should cool them

Step – 6: Also, you must do the blanching

Step – 7: Next, you must do grinding

Step – 8: Afterwards, you have to de – aerate them

Step – 9: Then, you need to cool them once more

Step – 10: After, you must fill them

Step – 11: Lastly, you should pack the peanut butter

The aforementioned stages of how peanuts are made into peanut butter can be described briefly in the following section.

You need to pre-clean the groundnuts:

You need to pre-clean the groundnuts to attain a good quality of groundnuts. This is done by washing them cleanly and neatly.

Removing the ground nuts shells

In this step, remove the hulls properly with the least or no damage to the kernels or seeds. To avoid the excessive brittleness of the kernels or shells and also to reduce the amount of dirt the moisture of the unshelled peanuts is adjusted or optimized.

Grading the ground nuts

You must grade the ground nuts so that small and big peanuts the shelled peanuts are graded uniformly.

Roasting the groundnuts

Roasting is referred to as the next stage in the simple steps of how peanuts are made into peanut butter. In this step, based upon the moisture content, roasting is done at 160 degrees Celsius for about 40 to 60 minutes. This process helps to enhance peanuts shell life and also adds flavor. In this process, the water content is reduced to 1%.

Cooling the roasted groundnuts

You must cool them after roasting the peanuts by placing them in a blower cooler cylinder. And the process is completed which makes the temperature 86 °F or 30 °C.


In the next step of how peanuts are made into peanut butter, one should do blanching. In this step, the cooled peanuts are blanched and are done in two ways:

1.     Firstly, Heat Blanching

2.     Secondly, Water Blanching

The above two types of blanching can be explained below:

Heat Blanching:

Heat Blanching is an old process where peanuts are heated at 280 °F or 138 °C for around 20 minutes which aids to soften and split the skins.

Water Blanching:

Water Blanching is a new process in which the peanuts are undergone in the removal of outer red skin and then checked for the removal of discolored grey nuts or black nuts.

Grinding the peanuts

You must do grinding as the next step. In this step, the peanuts are grounded in a peanut butter mill which gives in 02 stages to delivers fine & creamy butter. During this process, the outlet temperature should be maintained to 65°C to 75°C. And also the ingredients such as sugar or salt are included in this process.

You have to de-aerate

In this step, you must de – aerate them. In this step, during the process, the air is incorporated into peanut butter that subsequently removed in a Vacuum.

Cool the de-aerated peanuts

You must cool them again is the ninth step in the simple steps of how peanuts are made into peanut butter. In this step, a scraped surface heat exchanger is employed for the process of cooling. 


In this final step, as per the orders of the buyer, the peanut butter is added in the following: pet jars or metal drums.

It is important to pack the peanut butter as the last step for simple steps of how peanuts are made into peanut butter. Here pack the peanut butter in the bottles and stock them.

Investment required to starting Peanut Butter business in India

The Peanut Butter making is a business that does not need much capital investment. The estimated cost of acquiring the milling machine is around Rs. 2 lakhs, which too can be minimized if the machines are rented in the beginning. Thus, given the rate of return in the business, the investment capital is less. You can just start with a minimum of Rs. 1 L – 1.5 L investment. 

Loans availability without any hurdles

As discussed, a flour mill is having huge demand and also not demands much investment when you start the business, which are positive aspects in favor of the mill business which supports banks to lend out loans to businessmen easily, for beginning a flour mill.

The profit margin in Peanut Butter making business in India

You can expect a good range of profit margin from 30-35% in the initial stages as it is a very simple process. But you need to keep in mind that quality should be your priority. This will attract a huge number of customers. As it is having many health benefits Peanut Butter making business will result in good profits. 

You should not miss this: Money Making Ideas For Housewives.

Marketing strategies for promoting your product

You can promote your product through social media websites. You can even try by using either B2B or B2C websites and sell the products. Give the samples of your product in the nearby restaurants, hotels, grocery stores, supermarkets, etc. It has great demand in the market because of its high nutritional values and health benefits.


  1. We are in process of selecting food processing unit in Western Rajasthan and needs help in designing our unit. Suggest how to start.

  2. i want to start a mini plant of peanut butter. so i need your suggestion. please guide me? my mobile number is 9409527161.


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