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groundnut oil production businessThis free groundnut oil production business plan template will give you needed guide on how to start and profit from groundnut oil manufacturing business. The cost and source of quality groundnut oil processing machine and equipment needed for the commercial processing of groundnut oil. The packaging of the finished product and the feasibility report on groundnut oil production business are discussed in this groundnut oil production business plan template.

Market Analysis
Demand and Supply Dynamics

Groundnut is an oil seed crop that has been recognized as an important source of raw materials for the food and beverage industry. It is a good source of protein and oil for various industrial uses. The demand for groundnut oil is on the increase because it is a vegetable oil, which is used among the household in Nigeria. The application of groundnut oil meets the specific requirements of various industries, including pharmaceutical, cosmetics, food and beverage and textile industries.

Groundnut seed, which is the raw material for this product is grown in commercial quantity in Nasarawa Eggon local government area of Nasarawa State. This makes the venture very attractive for potential industrialists.

Project Engineering of groundnut oil production business

Plant capacity:

The plant is expected to produce 1,200 litres of groundnut oil per annum. Raw Materials Requirements

The raw materials required for the extraction of oil are groundnut seed and chemical – hexanes.

Quantity 5 metric tones
Quality Good
Cost 5 metric tones @ N25,000/MT 125,000
Source: Local


Production Process in groundnut oil production business

The common method used in production of groundnut oil is as follows: The groundnut is dehusked, roasted and passed into seed crusher to facilitate pressing. The crushed seeds are fed into screw press expeller to extract the oil and separate it from the pressed cake residue. The oil is passed into refining unit. The sediment left over from the refining process of the crude oil is useful in margarine making and other things.

Machinery and Equipment Requirements:

Equipment required for groundnut oil extraction are seed dryer, seed crusher, oil expeller machine, oil filter press, pumps and stainless tank.

Sources: Local and Imported

Labour/Manpower Requirement of groundnut oil production business

Number of People Required: 8

S/No. Category Number N ’000
1 Manager 1 244,000
2 Accountant 1 150,000
3 Skilled workers 2 120,000
4 Unskilled worker 4 320,000
Total 8 834,000

Source: Local

Training Needs:

In-plant = Yes

Out-pla = Yes

Both = Yes


1 Power 70,000
2 Fuel 40,000


3 Water 20,000
Total 130,000

Other Facilities

Telephone, transport

Preliminary Financial Analysis of groundnut oil production business

Cost of Fixed Assets (Investment) N’000
1 Land 250,000
2 Building 500,000
3 Furniture/Fittings 400,000
4 Plant & Machinery 2,000,000
5 Project Vehicle 400,000
6 Utilities 450,000
7 Preliminary & Pre-operational expenses. 200,000
8 Contingencies (10%) 420,000
Total 4,620,000

Working Capital

N ’000
Raw materials 31,025
Salaries and wages 208,000
Overhead and utilities 32,050
Total working capital 271,075
Estimated Turnover
N ’000
1200 liter @ N350/annum 4,200,000

Operating cost

0.75% of preceding cost of production 2,962,050 Gross margin (%) 51.8% Source: RMRDC, Abuja 2003.

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