Palm Kernel Oil Production In Nigeria

Palm kernel oil (PKO) is a vegetable oil extracted from the kernels of oil palm fruits. It is different from the popular palm oil (AKA red oil) which is extracted from the pulp of the oil palm fruit. It is mostly used in the cosmetic industry for the production of soaps, washing powders and other cosmetic products. It can also be fractionated, physically refined, deodorised, and bleached to give edible oil used in the food industry.

DEFINITION OF TERMS

  • Palm Kernel Nut (PKN): These are nuts obtained from the oil palm fruits. They are derived after the flesh of the oil palm fruit has been stript from it. The nuts are the major raw material for the palm kernel oil production business.
  • Palm Kernel: This is the edible kernel recovered by the cracking of the palm kernel nuts. It is these kernels that are passed through further processing to obtain the palm kernel oil.
  • Palm Kernel Oil (PKO): This is the oil that is extracted from the palm kernel.
  • Palm Kernel Cake (PKC): This is the by-product obtained after the oil has been extracted from the kernel. It is usually used as an ingredient in animal feed production.

The production of palm kernel oil involves purchasing palm kernel nuts, cracking the nuts with nut cracking machine to get the kernels, and extracting the oil from the kernel with an oil extractor machine.

The business of palm kernel oil production is a very lucrative one that has a large market in Nigeria due to its industrial applications.

Setting Up Cost

We prepared a well researched business plan that envisaged a palm kernel oil production plant with a processing capacity of 10 tons per day, producing about 4,000 liters of PKO and over 4,000Kg of PKC.

You will need a building to set up your factory in. Cost of these depends on your location.

Machinery for the factory include: Oil expeller, Nut toaster, Oil filter press, storage tanks, etc.

The cost of the complete set of machinery is estimated to be 14,000,000). You will also need to budget about one million naira (N1,000,000) for installations, test-run and training for your staff. 

You will also need vehicles for transporting your products to customers.

Profitability

The average profit realisable from processing 1 Ton of palm kernel is N30,000. A company that is able to process 10 Tons per day and work for 20 working days has the potential of turning in a gross profit of over six million naira monthly.

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