Post by Trade facilitator on Dec 16, 2021 20:35:33 GMT 1
Palm oil is a reddish natural edible vegetable oil extract derived from the fruit of palm trees. It is used by almost every home in Nigeria. It is generally accepted and widely used, not only in Nigeria but around the world. It is a native oil with rich components found in Nigeria and some parts of Africa.
The demand for palm oil has always been high and still on the increase. When palm oil is not being used for food, it is an important raw material in the production of soaps, detergents, greases, lubricants and candles. The versatility of palm oil makes it a highly sought-after commodity in homes, restaurants, food processing industries and various manufacturing industries that make; cosmetics, animal feed, soap manufacturing, confectioneries, and bio-fuel.
The palm oil business is one of the lucrative businesses in Nigeria because of its diverse usefulness and the huge profit involved. In Nigeria, palm oil is one of the essential needs for cooking most meals. The interesting part of this business is that every part of the palm tree (fruits, leaves, trunks, and sap) is used for different things.
The palm fruits are processed to produce palm oil, the leaves on the other hand are used for thatch roofing, brooms, weaving palm baskets etc. While the popular palm wine which is the sap is a refreshing and widely loved beverage in Nigeria.
Using palm oil for cooking has great health benefits as it is said to have a high concentration of vitamin E in the finest proportion. It is also rich in carotene and possess strong healing properties.
Palm oil is one of the commodities constantly in high demand in Nigeria. There is never a time it wouldn’t be needed in the market. It is usually surplus around December to April and sells the highest around July to September.
Palm oil is of strategic importance as it is used in the production of more than half of the products sold in supermarkets globally. Nigeria is the largest consumer of palm oil in Africa. The nation consumed approximately 3 million MT of fats and oils in 2018, with palm oil accounting for 44.7% or 1.34 million MT. In the same period, production stood at 1.02 million MT resulting to supply shortfall of 0.32 million MT (excluding possible impact of palm oil exports). In the early 1960s, Nigeria was the world's largest palm oil producer with a global market share of 43%. Today, it is the 5th largest producer with less than 2% of total global market production. In 1966, Malaysia and Indonesia surpassed Nigeria as the world's largest palm oil producers. Since then, both countries combined produce approximately 80% of total global output, with Indonesia alone responsible for over half i.e. 53.3% of global output. From 1975 to 2009, Nigeria remained the second largest recipient of funding from the apex bank for palm oil investments with six projects. However, only one project survived while the rest went bankrupt. Today, Nigeria is the fifth largest palm oil producing country, with 1.5% or 1.03 million metric tonnes of the world's total output, according to the United States Department of Agriculture (USDA).
According to the Central Bank of Nigeria (CBN), if Nigeria had maintained its market dominance in the palm oil industry, the country would have been earning approximately $20 billion annually from cultivation and processing of palm oil today.
In West Africa, Côte d'Ivoire, Ghana, Nigeria and Sierra Leone are major producers of both palm oil and palm kernel oil (PKO).
There are states in Nigeria that are known for producing palm oil in large quantities. Although there are several other states that produce palm oil, but the states listed below are seen as the largest producers of quality palm oil in Nigeria:
Akwa-Ibom State
Cross-River State
Delta State
Bayelsa State
Imo State
Rivers State
Ondo State
Abia State
Some other main palm oil producing states includes Ogun, Oyo, Edo, Anambra, Enugu, Ekiti.
Palm oil forms an important part of the local diet in Nigeria because animal fats such as milk and butter are hardly consumed. It is used both as a cooking material and as an ingredient in soups, sauces and a variety of local dishes. It is also needed for the industrial production of soap and confectionaries.
Consequently, there had long been a thriving market for palm oil both within the main areas of production in eastern and western Nigeria and the non-palm oil producing northern region.
There isn't a fixed price of palm oil, the price change is seasional. The demand for Palm Oil is high in Nigeria. Consumption of palm oil cuts across social, religious, age in Nigeria in general because it is consumed every day in almost every home in Nigeria mainly for cooking purposes.
Some of the factors which have influenced the demand for palm oil in Nigeria include growth in per capita income, increase in population, and increase in number of fast food joints, restaurants and hotels and the growth in the national economy over the years.
The Nigerian palm oil industry is very fragmented and dominated by numerous small-scale farm holders, which accounts for over 80% of local production, while established plantations account for less than 20% of the total market. Local farmers produce roughly 80% of the total production, The dominance of small farm holders in the palm oil market has resulted in low output compared to the country's production potential. There has been renewed interest in Nigeria's palm oil market with the entrant of major food manufacturers via backward integration strategies into the upstream and midstream segments.
The estimated demand for palm oil in Nigeria is about 1,600,000 metric tons /annum. To meet the demand in Nigeria, palm oil is imported most especially from Asian countries like Indonesia, Malaysia and Singapore.
Export potential of Palm oil
Gone are the days when people think that the only sector to make cool money in Nigeria is oil and gas. Nowadays, industries that are being overlooked are the ones raking in huge profits for the business owners
Palm oil is the most versatile of all vegetable oils. Palm oil is used in large volumes across various industries such as food, personal care and biofuel industries. It is known to be an excellent source of calcium and the least allergic to all edible oil. The usefulness of palm oil is what makes it have a huge demand-supply gap and opens up opportunities for investors and those interested in exporting palm oil from Nigeria.
The exportation of palm oil from Nigeria to other countries is a lot different from selling it in the local market. So to go into the exportation of Palm oil, you need to understand the ropes of the exportation business as well as the product in question. Understanding the exportation business includes:
Requirements for a license
Where and how to source for products,
Port processes,
Marketing strategies,
How to find foreign customers,
maximize profits in business deals, etc.
How to Start a Business Exporting Palm Oil from Nigeria
Understand the international market
You need an in-depth knowledge about licensing requirements, how to source your products, port procedure, how to find customers, how to interact with foreign customer, etc, and the best way to go about it.
A good way to gather these information is from someone who is currently and successful in the business or make inquiries to get links and tips from the Nigeria Export Promotion Council (NEPC), or most preferably, a consulting firm in the business of exporting palm oil.
Sourcing the palm oil
There are two (2) things to consider;
Will you be processing the palm fruit into palm oil by yourself or
Will you buy the already processed palm oil?
If you're processing your products yourself, you should already know how to go about that or make further inquiries.
If you intend to buy the already processed oil, then you have to know where to purchase the palm oil at the best price to maximise profit. Look for a efficient suppliers that can supply palm oil both in season and out of season.
Currently in Nigeria, Akwa-Ibom state is the largest producer of palm oil. Other states that produce palm oil in large quantities include Cross River, Rivers, Abia, Imo, Ondo, Edo, Delta and Bayalsa state.
Documentation (Requirements For Starting an Export Business In Nigeria)
Documentation
In order to export palm oil from Nigeria to other countries, you will need some documentations. These documents include, company registration, quality assurance and commercial documents, traffic concession, shipping documents etc.
For exportation business in Nigeria, you will need to get the required documentation. Some of these documents are:
Register The Business with CAC
Registering your company is compulsory if you want to export goods from Nigeria to other countries. If it is only an individual looking to export palm oil, he or she could register as a sole proprietor. A medium or large company can incorporate as a Limited Liability Company.
Open a business account
Register With The Nigerian Export Promotion Council (NEPC)
To start your palm oil exportation business, you will need to register with the Nigerian Export Promotion Council. These council will provide you with viable information on best practices and regulatory requirements for exporters. Members also get privileges such as access to foreign buyers. The council also provides you the opportunity of meeting with people who are experienced in the business. Get the contact of someone who has been in the palm oil exportation business for a very long time and who has proven successful. You can also inquire from them how to run a successful palm oil exportation business in Nigeria.
Obtain Special Licences And Permits For The Goods You’re Dealing In (Standard/Quality Assurance)
Most western countries have very strict rules that you need to comply with if exporting palm oil to them. You must make sure that your palm oil has a quality assurance certification. The label should include the following details:
Address of processing company
NAFDAC number
Date of production/expiration
Proper packaging and sealing of goods
Verify Your Products Are Not On The Prohibited Goods List
Be sure to make inquiries about the goods you're shipping and tge country you're shipping to and find out if your product is allowed there and their requirements/policies. This information is readily available to you at the NEPC and at experienced export consulting firms.
Get Your Insurance Covered
Having an Insurance cover is very very important, to protect you in the business world. Insurance goes a long way to help you as an exporter.
Partner With A Freight Forwarding Service Company To Ship Your Goods (Shipping documents)
The most cost-effective method of transportation of palm oil is shipping. Take proper care to contact a good shipping company that has evidence of experience in exporting commodities. With this kind of shipping company, you will be provided with useful information on how to handle the documentation. Some shipping documentation includes customs, export agencies, etc.
After registering as an exporter, and ready to export, you'll need certain requirements;
Required export documents
For formal exports the following documents will be required at different stages of the export process:
Exporter Registration Documents
Export Contract Documents
Quality Assurance Documents
Commercial Documents
Financial Documents
Goods Movement Documents
Determine your market
Finding customers is much easier than before due to technology. From the comfort of your home, you can negotiate a business deal. Ways you can achieve this is through participation in trade websites, trade fairs, etc.
Goods Movement Documents
The good news is, THE THY CONSULTING LTD can walk you through every process and or help you with these registration process and also link you with buyers and sellers if you want.
Feel free to contact us.
The demand for palm oil has always been high and still on the increase. When palm oil is not being used for food, it is an important raw material in the production of soaps, detergents, greases, lubricants and candles. The versatility of palm oil makes it a highly sought-after commodity in homes, restaurants, food processing industries and various manufacturing industries that make; cosmetics, animal feed, soap manufacturing, confectioneries, and bio-fuel.
The palm oil business is one of the lucrative businesses in Nigeria because of its diverse usefulness and the huge profit involved. In Nigeria, palm oil is one of the essential needs for cooking most meals. The interesting part of this business is that every part of the palm tree (fruits, leaves, trunks, and sap) is used for different things.
The palm fruits are processed to produce palm oil, the leaves on the other hand are used for thatch roofing, brooms, weaving palm baskets etc. While the popular palm wine which is the sap is a refreshing and widely loved beverage in Nigeria.
Using palm oil for cooking has great health benefits as it is said to have a high concentration of vitamin E in the finest proportion. It is also rich in carotene and possess strong healing properties.
Palm oil is one of the commodities constantly in high demand in Nigeria. There is never a time it wouldn’t be needed in the market. It is usually surplus around December to April and sells the highest around July to September.
Palm oil is of strategic importance as it is used in the production of more than half of the products sold in supermarkets globally. Nigeria is the largest consumer of palm oil in Africa. The nation consumed approximately 3 million MT of fats and oils in 2018, with palm oil accounting for 44.7% or 1.34 million MT. In the same period, production stood at 1.02 million MT resulting to supply shortfall of 0.32 million MT (excluding possible impact of palm oil exports). In the early 1960s, Nigeria was the world's largest palm oil producer with a global market share of 43%. Today, it is the 5th largest producer with less than 2% of total global market production. In 1966, Malaysia and Indonesia surpassed Nigeria as the world's largest palm oil producers. Since then, both countries combined produce approximately 80% of total global output, with Indonesia alone responsible for over half i.e. 53.3% of global output. From 1975 to 2009, Nigeria remained the second largest recipient of funding from the apex bank for palm oil investments with six projects. However, only one project survived while the rest went bankrupt. Today, Nigeria is the fifth largest palm oil producing country, with 1.5% or 1.03 million metric tonnes of the world's total output, according to the United States Department of Agriculture (USDA).
According to the Central Bank of Nigeria (CBN), if Nigeria had maintained its market dominance in the palm oil industry, the country would have been earning approximately $20 billion annually from cultivation and processing of palm oil today.
In West Africa, Côte d'Ivoire, Ghana, Nigeria and Sierra Leone are major producers of both palm oil and palm kernel oil (PKO).
There are states in Nigeria that are known for producing palm oil in large quantities. Although there are several other states that produce palm oil, but the states listed below are seen as the largest producers of quality palm oil in Nigeria:
Akwa-Ibom State
Cross-River State
Delta State
Bayelsa State
Imo State
Rivers State
Ondo State
Abia State
Some other main palm oil producing states includes Ogun, Oyo, Edo, Anambra, Enugu, Ekiti.
Palm oil forms an important part of the local diet in Nigeria because animal fats such as milk and butter are hardly consumed. It is used both as a cooking material and as an ingredient in soups, sauces and a variety of local dishes. It is also needed for the industrial production of soap and confectionaries.
Consequently, there had long been a thriving market for palm oil both within the main areas of production in eastern and western Nigeria and the non-palm oil producing northern region.
There isn't a fixed price of palm oil, the price change is seasional. The demand for Palm Oil is high in Nigeria. Consumption of palm oil cuts across social, religious, age in Nigeria in general because it is consumed every day in almost every home in Nigeria mainly for cooking purposes.
Some of the factors which have influenced the demand for palm oil in Nigeria include growth in per capita income, increase in population, and increase in number of fast food joints, restaurants and hotels and the growth in the national economy over the years.
The Nigerian palm oil industry is very fragmented and dominated by numerous small-scale farm holders, which accounts for over 80% of local production, while established plantations account for less than 20% of the total market. Local farmers produce roughly 80% of the total production, The dominance of small farm holders in the palm oil market has resulted in low output compared to the country's production potential. There has been renewed interest in Nigeria's palm oil market with the entrant of major food manufacturers via backward integration strategies into the upstream and midstream segments.
The estimated demand for palm oil in Nigeria is about 1,600,000 metric tons /annum. To meet the demand in Nigeria, palm oil is imported most especially from Asian countries like Indonesia, Malaysia and Singapore.
Export potential of Palm oil
Gone are the days when people think that the only sector to make cool money in Nigeria is oil and gas. Nowadays, industries that are being overlooked are the ones raking in huge profits for the business owners
Palm oil is the most versatile of all vegetable oils. Palm oil is used in large volumes across various industries such as food, personal care and biofuel industries. It is known to be an excellent source of calcium and the least allergic to all edible oil. The usefulness of palm oil is what makes it have a huge demand-supply gap and opens up opportunities for investors and those interested in exporting palm oil from Nigeria.
The exportation of palm oil from Nigeria to other countries is a lot different from selling it in the local market. So to go into the exportation of Palm oil, you need to understand the ropes of the exportation business as well as the product in question. Understanding the exportation business includes:
Requirements for a license
Where and how to source for products,
Port processes,
Marketing strategies,
How to find foreign customers,
maximize profits in business deals, etc.
How to Start a Business Exporting Palm Oil from Nigeria
Understand the international market
You need an in-depth knowledge about licensing requirements, how to source your products, port procedure, how to find customers, how to interact with foreign customer, etc, and the best way to go about it.
A good way to gather these information is from someone who is currently and successful in the business or make inquiries to get links and tips from the Nigeria Export Promotion Council (NEPC), or most preferably, a consulting firm in the business of exporting palm oil.
Sourcing the palm oil
There are two (2) things to consider;
Will you be processing the palm fruit into palm oil by yourself or
Will you buy the already processed palm oil?
If you're processing your products yourself, you should already know how to go about that or make further inquiries.
If you intend to buy the already processed oil, then you have to know where to purchase the palm oil at the best price to maximise profit. Look for a efficient suppliers that can supply palm oil both in season and out of season.
Currently in Nigeria, Akwa-Ibom state is the largest producer of palm oil. Other states that produce palm oil in large quantities include Cross River, Rivers, Abia, Imo, Ondo, Edo, Delta and Bayalsa state.
Documentation (Requirements For Starting an Export Business In Nigeria)
Documentation
In order to export palm oil from Nigeria to other countries, you will need some documentations. These documents include, company registration, quality assurance and commercial documents, traffic concession, shipping documents etc.
For exportation business in Nigeria, you will need to get the required documentation. Some of these documents are:
Register The Business with CAC
Registering your company is compulsory if you want to export goods from Nigeria to other countries. If it is only an individual looking to export palm oil, he or she could register as a sole proprietor. A medium or large company can incorporate as a Limited Liability Company.
Open a business account
Register With The Nigerian Export Promotion Council (NEPC)
To start your palm oil exportation business, you will need to register with the Nigerian Export Promotion Council. These council will provide you with viable information on best practices and regulatory requirements for exporters. Members also get privileges such as access to foreign buyers. The council also provides you the opportunity of meeting with people who are experienced in the business. Get the contact of someone who has been in the palm oil exportation business for a very long time and who has proven successful. You can also inquire from them how to run a successful palm oil exportation business in Nigeria.
Obtain Special Licences And Permits For The Goods You’re Dealing In (Standard/Quality Assurance)
Most western countries have very strict rules that you need to comply with if exporting palm oil to them. You must make sure that your palm oil has a quality assurance certification. The label should include the following details:
Address of processing company
NAFDAC number
Date of production/expiration
Proper packaging and sealing of goods
Verify Your Products Are Not On The Prohibited Goods List
Be sure to make inquiries about the goods you're shipping and tge country you're shipping to and find out if your product is allowed there and their requirements/policies. This information is readily available to you at the NEPC and at experienced export consulting firms.
Get Your Insurance Covered
Having an Insurance cover is very very important, to protect you in the business world. Insurance goes a long way to help you as an exporter.
Partner With A Freight Forwarding Service Company To Ship Your Goods (Shipping documents)
The most cost-effective method of transportation of palm oil is shipping. Take proper care to contact a good shipping company that has evidence of experience in exporting commodities. With this kind of shipping company, you will be provided with useful information on how to handle the documentation. Some shipping documentation includes customs, export agencies, etc.
After registering as an exporter, and ready to export, you'll need certain requirements;
Required export documents
For formal exports the following documents will be required at different stages of the export process:
Exporter Registration Documents
Export Contract Documents
Quality Assurance Documents
Commercial Documents
Financial Documents
Goods Movement Documents
Determine your market
Finding customers is much easier than before due to technology. From the comfort of your home, you can negotiate a business deal. Ways you can achieve this is through participation in trade websites, trade fairs, etc.
Goods Movement Documents
The good news is, THE THY CONSULTING LTD can walk you through every process and or help you with these registration process and also link you with buyers and sellers if you want.
Feel free to contact us.
