Is it profitable to invest in edible oil refinery plant in Nigeria?
According to authoritative research reports, Nigeria’s edible oil consumption is expected to reach about 3 million tons per year, with huge market demand. However, most is sold unrefined to the market. Not only is the storage time short, but crude oil also contains many harmful substances that affect people's health. Many entrepreneurs want to invest in edible oil refinery plant in Nigeria, so is it profitable to invest in edible oil refineries in Nigeria?
5tph edible oil refinery plant in Nigeria
The edible oil refining business has high profits and low risks. Profit margins range from 5% to 10% depending on the raw material. Margins on premium oils can be as high as 25%. Additionally, training employees to use machines efficiently, implementing shift systems to extend production times, and regularly maintaining equipment can all increase profits by reducing costs. This article will analyze for you whether it is profitable to invest in an edible oil refinery plant in Nigeria from both raw materials and equipment.
1. Nigeria’s edible oil market
Palm oil is of strategic importance to Nigeria as more than half of the products sold in supermarkets globally are produced from palm oil. In 2018, national oil consumption was approximately 3 million tons, of which palm oil accounted for 44.7%, or 1.34 million tons. The fatty acid by-products of refining extraction also command good prices.
Palm oil in Nigeria
In 2022, Nigeria's palm kernel oil production is expected to be 393,000 tons. Between 2010 and 2022, the country's palm kernel oil production increased by 88,000 tons. The largest increase occurred in 2021, with production up nearly 10.4% from the previous year. Most of the refined palm kernel oil is exported to neighboring countries and European countries.
Meanwhile, Nigeria's soybean oil production is expected to reach 139,000 tons in 2026, up from 112,000 tons in 2021, with an average annual growth rate of 3.5%. Nigeria’s edible oil supply has been increasing since 1993, at an annual rate of 5.2%. At the same time, soybean oil also has the advantages of low cost and short cycle.
2. Nigeria’s edible oil refining equipment market
In 2023, the Nigerian branch of Henan Glory Company will explore the Nigerian market and build a factory in Nigeria to produce edible oil processing equipment. You can purchase edible oil refining equipment from Henan Glory Company at ex-factory price, which not only saves you equipment costs, but also helps you save transportation costs and increase your profits from investing in edible oil refinery plant.
Edible oil refinery plant
The profit margin of the edible oil refining business depends on the supply of raw materials, the quality of raw materials and operating costs. Nigeria has abundant raw materials and a promising market for refined edible oils. Therefore, it is proposed to build palm oil refinery plant, palm kernel oil refinery plant and soybean oil refinery plant in Nigeria.
If you have any questions about investing in an edible oil refinery plant in Nigeria, or would like to know any information about edible oil refining equipment, please contact us and we will provide you with a free quotation service.
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