Make Money from Red Palm Oil Business in Nigeria

Make Money from Red Palm Oil Business in Nigeria

You can make some money yearly from buying, storing and reselling red palm oil in Nigeria. It is one of the best businesses to invest your money in yearly if properly done.

Red palm oil is generally accepted and widely used, not only in Nigeria but around the world.

Palm oil (also known as dendê oil, from Portuguese) is an edible vegetable oil derived from the mesocarp (reddish pulp) of the fruit of the oil palms, primarily the African oil palm Elaeis guineensis.

Palm oil is an essential part of diet of man and animals also plays leading roles in the manufacturing of soap to cereal, bread and cosmetics. It is semisolid at room temperature and naturally reddish in color because of a high beta-carotene content.  The demand for palm oil is almost constant all year round and it has a relatively long shelf life.

Palm oil is a common cooking ingredient in the tropical belt of Africa, Southeast Asia and parts of Brazil. 

One can start off with a capital of between ₦150,000 to ₦1,000,000 and above

Palm oil is an important source of calories and a food staple in poor communities and virtually every household cooks with palm oil. So, you can imagine how much profit you can make from the business. 

Steps on how to start the business

• Secure a good storage space

Secure some space for the storage of your palm oil after purchase. Storage space can be your own garage, back yard, market, anywhere (or even the purchase venue) but preferably closer to where your targeted customers are. Any storage space that works for you will be fine but bear in mind the cost of transporting them to and fro. In Nigeria, palm oil is best stored in drums / barrels, in a cool place away from direct sunlight. It takes about 8 – 10 (20liter) gallons to fill a barrel.

• Source for suppliers

Try to find suppliers that produce high quality palm oil. You may need to conduct thorough research before making your choice because the quality of  the palm oil will largely determine the success of your business  From experience,  good palm oil can be sourced from Imo state in places such as Ngor Okpala, Orlu, Ondo, Ebonyi and Edo  State respectively.

• Plan on affordable transportation mechanism 

You would need to handle and transport your palm oil from (location A to another) the supplier’s location to your storage location. Or you sell to your customers directly from the supplier's location either to reduce cost or make more money by including the transportation cost in your customer's bill.

Transporting them requires a van or truck or you engage the services of a transport business.

• Market and sell your product

Market the palm oil to your target market/customers for unbeatable / attractive prices. Depending on your business method, you can choose to sell to the next available buyer with a little margin on top, or wait until off-peak period before selling.

The prices of palm oil drops very low usually between March and May of every year, due to the abundance of the product on the market. However, during the off-peak (non-harvest) periods, between September and December, scarcity sets in and the price rise by as much as 100%.