Palm oil, that staple red oil that you can find in every kitchen across the country. Used for various soups and sauces, from Egusi to Vegetable soup. The Business of Buying Palm Oil for all those Kitchens is a multi-billion Naira industry that’s over 35 years old.
As you can see, because of its usage, palm oil purchase and supply has remained a viable business for so long. A business that has consistently been producing over 970,000 metric tons of palm oil yearly, for local markets and for exports.
Palm oils current price for 1 metric ton international markets stands at $562 or N186, 541. That over N1.8 billion Naira in global market share alone.
Where does all this palm oil come from?
It still originates from local Mills in various states in Nigeria to the market women who handle its sale and distribution of nationwide and internationally, which is largely unregulated and documented by the government.
Which makes it one profitable business to get started on in 2016.
Getting started in Palm Oil purchase and supply, means getting to know how the business operates, where to buy, who are the players in various state etc.
Because without the information, you will just waste time an effort groping blindly in the dark and losing money.
So what do you need to know first?
Buying palm oil in bulk, Where to go?
Palm oil is usually milled from the palm fruit bunch by both small and large plantations. The plantations are usually the best place to go if you require large quantities of Crude palm oil.
You can also meet with rural Road side Mills,
If you are from a palm producing state, I.E Edo state, Delta, Ekiti, Cross River, Awka Ibom, Imo, Abia, Anambra, Rivers and Ebonyi State. You will usually be accustomed to seeing rural road side mills as you move around towns in each local governments of the state. Sometime you might have upwards of 5 mills per area.
Sometimes these milling my not be alone the roads but further inside. To find them you might have to ask people around or follow your nose for that palm kernel oil smell.
What types do you buy?
Most of us believe that palm oil is just palm oil. The truth, just as soups come in different flavors so also does palm oil. There are two types of palm oil you need to pay close attention to when you go buying in bulk.
Low moisture content and high moisture content palm oils.
Have you ever gone out to buy palm oil from your local food sell and notice that it’s a chore to get the oil out of the bottle? That bottle of palm oil has low moisture content meaning, it’s rich in fatty acids that make up the palm oil plus it tends to turn solid when not at room temperature.
It’s really good for cooking and can be stored for long periods of time without any significant change in taste.
Now as you can imagine, Palm oil with high moisture content, is usually more fluid. That Palm oil that when you want to use it flows right out of the bottle without hindered. You notice that the longer it stays it changes taste. It is usually better when it’s used immediately for cooking, but never a good idea for storing for long periods.
When buying Palm Oil in bulk, you stand to make a lot if you buy it pre rainy season when it is cheaper.
It’s far better for you to just buy and store in bulk than buying when demand goes up. Because as demand goes up during August September so does the price.
How much do you sell to you customers?
As at 15th March 2016, Palm oil is being sold at N9, 500 per 25 litres in the markets in Lagos. While at village markets you can get it at between N5500 and N7000.
Who will buy bulk orders from you?
You can supply bulk to various local markets and major cities, all depending on the price you purchase during storage period. It’s always better to make inquiries various people and place, across the Nigeria about the price in their markets. This will give you the opportunity of locating the best place to supply your Palm Oil.
If you’re looking for companies to supply to, please check out
r previous post here.
If you would like to get a list of more companies, that will buy your Palm Oil in bulk. You can drop us a comment in the comment section below.
Can you find foreign buyers?
There are various companies and that buy Palm Oil for international consumption. Some of these companies are located in Germany and Finland.
You can contact
How do you export?
When your current supply far outweighs your demand, it’s better to begin looking for markets outside of the country. Before you can begin contacting international buyers for export proposals, you need to have the necessary and required documentation from the relevant agencies, i.e. Customs, Export council and agricultural quarantine services.
Plus you also need lab analysis of you Palm Oil this is usually request for by the international buyer to a certain that the palm oil they are buying from you meets their requirements.
The process can be a long and expensive, but the reward for a successful delivery is most time usually worth it.
The business of palm oil can be very lucrative, when you know the right sources to get it, how best to store it and have the ready market to deliver it to.
I hope this detail helps you in your decision to get started or run it smoothly.
If you have any questions or want more details about local and international buyers of palm oil.
Please feel free to drop a comment.