Step by Step on How to Start Palm Oil Supply Business

The Palm Oil Supply business is a very lucrative business in Nigeria that anyone can start with a very small working capital. You can make large profits by investing in the Palm Oil Supply business.

If you intend to start a Palm Oil Supply business, then this post is for you. We have covered in detail the step-by-step procedures on how to start a Palm Oil Supply business in Nigeria.

When considering a Palm Oil Supply business plan, you have to first understand the palm fruit and its kernel, who uses it, and how it is used. To Get a well-written business plan for a Palm oil supply business with three years of financial projection, contact us

What Is Palm Oil?

If you are a newbie in the Palm Oil Supply business, then this introduction may be of help to you. Palm Oil is a local oil used for cooking in Nigeria. It has a red color which thickens if stored for a long periodic of contact with fire, palm oil is inflammable, just like any other oil.

Palm oil is not only used for cooking, it has a variety of applications, like in Medicine. Palm oil is a potent source of Vitamin A which helps to improve eyesight and can also be used to relieve oneself stomach pain. Palm oil also has some implications as it contains a high quantity of cholesterol that can occlude blood flow.

Palm oil can be refined and used in the production of cosmetic products and toiletries like body cream, toilet soap, and bath soap, among other products.

Some of the Common Uses of Palm Oil

  1. Production of Drugs
  2. Water Treatment Chemicals
  3. Production of Drilling Fluids
  4. Production of Canned Foods like Sardines, Minced Meat, and Baked Beans
  5. Production of Feed for domesticated animals like dogs, chickens, and Pigs.
  6. Preservation of foods both raw and cooked.

Steps on How To Start Up A Palm Oil Supply business

Your Palm Oil Supply business can make you large profits if you handle it properly. Everyone makes use of Palm oil or Palm Oil products in some way. Because of this, the Palm Oil Supply business market is booming as it is a huge necessity for many.

Going into Palm Oil Supply Business can be very favorable if you implement any of these three types of Palm Oil Supply businesses.

Palm Tree Plantation

This type of Palm Oil business is Capital intensive. You need to purchase a large expanse of land and also test the viability of the land for Palm tree plantation. This is because the quality of Palm fruits and Palm oil that will be produced largely depends on how fertile the land is.

Check out the Top 10 Palm Oil Producing States In Nigeria to help you decide on the state to invest in.

After making a pick on the most appropriate land type and size, next, you have to consider the location of the land. The land where you intend to plant your palm trees has to be close to the market. This will help to reduce the cost of transportation of palm fruits when you want to sell Palm Oil or nuts.

The incubation period of Palm trees takes between five to ten years before they can be harvested. It requires some patience on the side of the farmer. However, the harvest is normally bountiful as different palm trees ripen and different times in the same season. You can get about five heads of ripe oil palm fruits from a single palm tree.

As the owner of the palm tree plantation, you can decide to set up a palm oil extraction mill or you can sell the palm oil kernel seeds. To run this project Palm Oil Supply business, you may need a capital requirement worth millions of Nairas.

Therefore, to set up a palm oil tree plantation;

  • Make use of family land or purchase a land
  • Test the soil to know if it is fertile and viable for Palm tree plantations
  • Check for where you can sell or distribute your palm kernel seeds
  • Plant your palm trees
  • Wait patiently for five to ten years
  • Harvest your palm fruits

Setting Up A Palm Oil Mill

This aspect of the Palm Oil Supply business is relatively capital-intensive. This is because you need to install palm oil milling machines to process the palm oil kernel seeds. You can process palm oil kernels in two ways:

Commercial Processing

Here, you rent out the milling machines so other persons can process their palm oil kernels. These persons pay hiring fees to use the milling machines.

Palm Oil kernel is usually harvested between January and May and sometimes around July to December. During these periods, you can rent out the palm oil kernel milling machines and get paid.

Installation And Personal Use Of Palm Kernel Oil Milling Machines

This is another series of Palm Oil Supply businesses that involves processing palm oil kernels into Palm oil. Here, you simply install the milling Machines and purchase the harvested palm oil kernel from Farmers.

You can now process the pa oil kernel seeds that are, extract the palm oil from the palm oil kernel seeds, then sell the oil to resellers or users.

Sitting your palm oil milling machine at a good location will help reduce the cost of transportation between the milling factory and the place of sale.

Trading Palm Oil

Most investors in the Palm Oil Supply business are engaged in this form of Palm oil business. Here, you buy palm oil in large quantities and sell them off at a profit.

Some traders hoard palm oil till they are no longer in the season before they can begin selling their palm oil. Though this method is fraudulent, the traders usually make a great deal of profit in this course.

Steps To Take Before Starting A Palm Oil Supply business

Market Research

This can be formal or informal. It is here that you understand the basics of the Palm Oil Supply business, the nature, and volume of the business, who your customers are, and why they may want to patronize your Palm Oil Supply business.

You need to also know the states and locations that are the chief producers of palm oil, the prices that they sell at, their profit margins, and the markets that sell palm oil at the least prices with the best quality amongst other details.


You cannot go into any business without first understanding the capital requirements of the business. The capital you need to start up your Palm Oil Supply business must be able to do the following:

Working Capital

The minimal amount of money that you need to purchase the palm oil and the cost of transportation from the place of purchase to the warehouses where they are stored.


You need to consider the cost of getting a warehouse where you can store your palm oil that is not on sale at that point.

Cost of Acquiring The Means Of Storage

Your level of investment will largely determine how much you can spend on Acquiring the gallons, drums, and other storage methods.

Means Of Storage

Apart from having a container where you can store the palm oil, it is also advised that you have an idea of how best to store palm oil while maintaining its original taste and flavor. The kegs for storing the oil have to be well arranged in the warehouses where they are stored.

Contact Suppliers

You not only find the best suitable customers for your products but also the locations where you can get the Palm oil at its cheapest price. Make sure that the supplier is reliable and delivers the exact kind of quality that he advised.

Mode Of Transportation

When picking a Transport mode or company for transporting your palm oil, you need to consider the vehicle to be used, the security of the goods in Transit, and how best to maintain the transported goods at their original integrity.


Choosing the best market for selling your palm oil and keeping in touch with the supplier of the palm oil can be aiding.

Marketing Your Supply Business And Finding Palm Oil Exporters

To export palm oil from Nigeria, you will need to look out for palm oil exporters in Nigeria. You can market palm oil internationally on e-commerce websites like and Vconnect.

On, you can get in touch with international palm oil buyers and market your palm oil business. There are also local palm oil exporters on other top online stores.


The Palm Oil Supply business is one of the most profitable businesses in Nigeria. You can either go to a palm tree plantation, set up palm oil milling plants, or the sales of palm oil. The interesting part about the business is that you don’t need to stress yourself about getting your business approved by the Regulatory bodies in Nigeria like the CAC or NAFDAC.

Considering starting a Palm Oil Supply business? you need a business plan, CONTACT US to Get a well-written business plan for the Palm oil supply business with three years of financial projection.