Groundnut Oil Production Business Plan In Nigeria 2025

Executive Summary

This business plan details the establishment of a groundnut oil production business in Nigeria. Groundnut oil is a widely consumed edible oil, and its production offers a lucrative business opportunity due to the high demand in domestic and industrial markets. This plan outlines the market analysis, operational strategy, financial
projections, and marketing strategies necessary for success.

Business Description

● Business Name: NutriGold Oil Mills
● Location: Kano State, Nigeria
● Business Structure: Sole Proprietorship/Partnership (as applicable)
● Industry: Agro-processing
● Products: Groundnut oil (refined and unrefined) and groundnut cake (a byproduct used in livestock feed).

Objectives

1. To establish a groundnut oil processing plant with a production capacity of 2 tons per day within the first year.
2. To capture 5% of the local groundnut oil market within three years.
3. To achieve annual revenue growth of 25% through efficient operations and strategic marketing.
4. To contribute to Nigeria’s agricultural value chain by sourcing raw materials locally.

Market Analysis

● Industry Overview:

Nigeria is one of the largest producers of groundnuts in Africa.
The demand for groundnut oil is driven by its use in cooking, food processing, and cosmetics. The market is expanding as consumers prefer healthier and locally sourced cooking oils.

● Target Market:

○ Households and individual consumers.
○ Restaurants and food vendors.
○ Food processing companies.
○ Export markets for refined oil.

● Competitive Advantage:

○ High-quality, locally sourced products.
○ Competitive pricing compared to imported oils.
○ Efficient production processes that maximize yield.

SWOT Analysis

● Strengths:

○ Proximity to groundnut-producing regions ensures steady raw material supply.
○ High demand for groundnut oil and byproducts.
○ Use of modern processing equipment for high-quality output.

● Weaknesses:

○ High initial capital requirement for equipment and facilities.
○ Potential supply chain disruptions.

● Opportunities:

○ Export potential to neighboring countries.
○ Expansion into value-added products like flavored oils.

● Threats:

○ Competition from established brands and imported oils.
○ Fluctuations in groundnut prices due to seasonal variations.

Operational Plan

1. Facility Setup:
○ Secure a one-hectare site with access to utilities and transport.
○ Install processing equipment, including crushers, expellers, filters, and storage tanks.
○ Establish a quality control unit to ensure product standards.

2. Raw Material Procurement:

3. Production Process:
4. Quality Assurance:
○ Regularly test oil for purity and quality parameters.
○ Adhere to regulatory standards set by NAFDAC and SON.

Marketing Strategy

● Branding: Develop a strong brand that highlights quality, purity, and local sourcing.
● Sales Channels:
● Promotions:

Financial Plan

1. Startup Costs:

○ Land acquisition and factory construction: NGN
○ Equipment purchase (crushers, expellers, filters): NGN
○ Raw materials (initial stock of groundnuts): NGN
○ Operational costs (labor, utilities, licenses): NGN
○ Total: NGN

2. Revenue Projections:

○ Year 1: NGN
○ Year 2: NGN
○ Year 3: NGN
3. Profit Margins:
ETC…

Our Groundnut Oil Production Business Plan in Nigeria can be used to get bank loans, proposal, and grant applications. The business plan was complied after a thorough feasibility study on Groundnut Oil Production Business in Nigeria was done

Groundnut oil is a very essential product in Nigeria. Every home has a need for groundnut oil either for cooking stew, frying, baking or wiping surfaces.

Groundnut oil is used for most food in Nigeria even roadside small chops. The federal government has placed a ban on the importation of groundnut oil and this has created an opportunity for local production. Groundnut oil is in high demand.

Groundnut oil is one of the most valuable legumes of Nigeria with 25% protein and 45% oil. It is mostly found in the subtropical and semi-arid regions around the world. They are a good source of protein and vitamins. It mostly grow in country with warm climates.

Groundnut Oil Production Feasibility Study

Nigeria is among the first five countries producing groundnut and has the largest production in West Africa. Groundnut has high demand all around the countries. It can be used for preparing Africa dishes like groundnut soup, which can be used in eating rice. It can also be used in preparation of butter, groundnut oil, peanut oil and can be eaten naturally.

One ton of groundnut oil seeds will generate 500litres of groundnut oil, 420kg of groundnut oil cake, and 40kg of groundnut oil sludge.
1 ton of groundnut oil seed= #280,000
1 litre of groundnut oil = #700
1 kg of groundnut cake = #250
So if you process 1 ton of groundnut oil seed
1 kg of groundnut sludge = #250
So if you process 1 ton of groundnut oil seed, you are most likely to get an average of #20,000.

Research

Anyone going into groundnut oil business must have a great knowledge about it because it’s technical. It is also important to employ people who have knowledge about it, so as to get a well refined and high quality oil. It is also important to get consultant in this field who will set up the oil production chains and other processes involved in the business.

It is also important to get a business plan on what you will need to set up the business. The cost of production, the equipment required, landed properties, staffs recruitment, transportation and consultation.

This is important, you don’t just wake up and run into the market because it is profitable. You should carry out feasibility studies on the market, the cost price of production, competition and industry already available. This is to enable you know what to expect, how well to prepare and also to learn from the mistakes of others.

To place an order for our updated GROUNDNUT OIL PRODUCTION BUSINESS PLAN & FEASIBILITY STUDY, pay N15,000 to

GTBank (Guaranty Trust Bank)

Account Name – Uwadia Eyemeka
Account No – 0127561472

OPAY
Account Name – Eyemeka Uwadia
Account NO. – 7036785443

Registration

This involves registration of your company name in Corporate Affairs Commission (C.A.C) and also getting permits from other association involved in it.

Get an operating permit

This can be gotten from food regulations body like National Agency for Food and drugs Administration and control (NAFDAC) this body is a federal agency under the Federal Ministry of Health that is responsible for regulating and controlling the manufacture, importation, exportation, advertisement, distribution, sale and use of food.

We also have other bodies to obtain license from such as:
Food operating license
Trade license
Fire license
Company registration with ROC
AGMARK Certificate

Funding

This involves getting the capital you need for the business. Do you have enough money to start or do you intend to borrow from bank or other financial institutions? This business is lucrative but also involve finance.

Workers

This involves recruiting staffs, the staffs must be experienced in this field. The business is technical and requires skills, so you should employ people who knows about it so that you can produce good products.

Equipment Required for Groundnut oil Production

Steel drums for storing edible oil.
Filter press
Weighing balance
Batch type solar dryer
Cans and trays for handling oil seeds
Pre-cleaner for cleaning the oil seeds
Cooking pots
Child boiler
Oil expeller

Groundnut oil production process and technology

Cleaning: Clean the groundnut seed to remove any dirt, sand, stones and other debris so as not to contaminate the oil.

Dehulling: This is removing the outer seed coat of the oil seeds.

Grinding: This involves reducing the particle size.

Heating: This leads to greater yielding of oil.

Pressing: This involves pressing the oil seeds using a lever press.

Refining: This involves removing undesirable cloudiness, color and flavor from the extracted oil.

You can get a business structures of this kind;

Customer care executives
Truck drivers
Secretary
Accountants
Maintenance teams
Security guard
Marketing staffs

Problems involved in Groundnut Production

Little or no access to quality groundnut seeds, insecticide, pesticides, .
Lack of fund to begin.
Lack of technical know how.
Too much attack by insects.

Our templates / samples Groundnut Oil Production Business Plan in Nigeria can be used to access grants, bank loans, etc. The business plan was put together after a proper market research and feasibility study on Groundnut Oil Production Business in Nigeria was done.

Get our updated Groundnut Oil Production Business Plan In Nigeria / Feasibility Study. To place an order, pay N15,000 to

GTBank (Guaranty Trust Bank)
Account Name – Uwadia Eyemeka
Account No – 0127561472