Mechanized Castor Cultivation and Oil Production in Nigeria; The Feasibility Report.

Castor (Ricinus communis L.) is cultivated around the world because of the commercial importance of its oil. Castor oil, produced from castor beans, has long been considered to be of important commercial value primarily for the manufacturing of soaps, lubricants, and coatings, among others.

Castor oil has long been used commercially as a highly renewable resource for the chemical industry. It is a vegetable oil obtained by pressing the seeds of the castor oil plant (Ricinus communis L.) that is mainly cultivated in Africa, South America, and India. Major castor oil-producing countries include Brazil, China, and India.

This oil is known to have been domesticated in Eastern Africa and was introduced to China from India approximately one thousand, four hundred (1,400) years ago. India is a net exporter of castor oil, accounting for over ninety percent (90%) of castor oil exports, while the United States, European Union, and China are the major importers, accounting for eighty –four percent (84%) of imported castor oil.

Castor is one of the oldest cultivated crops; however, it contributes to only zero point fifteen percent (0.15%) of the vegetable oil produced in the world. The oil produced from this crop is considered to be of importance to the global specialty chemical industry because it is the only commercial source of a hydroxylated fatty acid.

Even though castor oil accounts for only zero point fifteen percent (0.15%) of the world production of vegetable oils, worldwide consumption of this commodity has increased more than fifty percent (50%) during the past twenty-five (25) years, rising from approximately four hundred thousand (400,000) tons in 1985 to six hundred and ten thousand (610,000) tons in 2010.

On average, worldwide consumption of castor oil increased at a rate of seven million, three hundred and twenty thousand (7,320,000) tons per year.

In general, the current rate of castor oil production is not considered sufficient to meet the anticipated increase in demand.
Castor oil is becoming an essential bio-based raw material which makes it ideal for various industrial applications. As a result, it is being increasingly used as a potential alternative to petroleum-based chemicals.

On account of its distinctive chemical structure, castor oil acts as a major raw material which is used in the production of various end products such as biodiesel, polyurethane adhesives, machining oils, refrigeration lubricants, etc. This versatile nature of castor oil has been contributing towards the propelling growth of the market.

As compared to other vegetable oils, castor oil is a healthier and less expensive alternative. Owing to this, food grade castor oil has gained a momentum in the food industry in the form of flavourings, mould inhibitor, food additives and packaging.

The global castor oil market is being hindered by the unstable prices of castor beans which is the result of their fluctuating supply. This supply highly depends upon the weather conditions of the region and a long harvesting process of castor beans.

Nigerians spend one hundred billion (₦ 100,000,000,000) annually on castor oil importation according to Lawan Ali, National President of castor growers processors and marketers association of Nigeria (CASGPMAN) despite having arable and fertile land, and climatic conditions suitable for its farming.

This report examines the financial viability of establishing a mechanized castor farm with a castor oil processing plant in Nigeria.

The farm would be one hundred and ten (110) hectares and one hundred (100) hectares would be used for cultivation while ten (10) hectares would be used for civil works and development.

The maturity of the crop depends on the variety. Most of the improved cultivars mature in about five (5) – six (6) months after planting.

Generally, yield of any crop depends on factors like cultivar, soil type, irrigation, climate and cultural practice. On the average, castor can yield one (1) ton in the first year, one point five (1.5) tons in the second and third year and two (2) tons from the fourth year till the seventh (7th) year.

The production capacity of the proposed plant is four (4) tons per day and all the raw materials would be sourced from the farm. We did not make provision for sourcing products from outside the farm.

Table of Contents

EXECUTIVE SUMMARY 1.0 Business Overview 1.1 Description of the Business 1.2 Vision and Mission Statement 1.3 Business Objective 1.4 Critical Success Factor of the Business 1.5 Current Status of Business 1.6 Description of the Business Industry 1.7 Contribution to Local and National Economy 2.0 Agricultural Practice 2.1.0 Seedlings 2.1.1 Planting 2.1.2 Manures and Fertilizers 2.1.3 Weeding and Herbicides 2.1.4 Climate / Irrigation 2.1.5 Harvesting and Yield 2.1.6 Soil Type 2.1.7 Diseases and Pests 3. Marketing Plan 3.1 Description of products 3.2 Product Packaging and delivery 3.3 The Opportunity 3.4 Pricing Strategy 3.5 Target Market 3.6 Distribution and Delivery Strategy 3.7 Promotional Strategy 3.8 Competition 4. Production Plan 4.1 Description of the Location 4.2 Raw Materials 4.3 Production Equipment 4.4 Production Process 4.5 Production Cost 4.6 Stock Control Process 4.7 Pre-Operating activities and expenses 4.7.1 Operating Activities and Expenses 4.8 Project Implementation Schedule 5.0 Organizational and Management Plan 5.1 Ownership of the business 5.2 Profile of the promoters 5.3 Key Management Staff 5.3.2 Management Support Units 5.4 Details of salary schedule 6. Financial Plan 6.1 Financial Assumption 6.2 Startup Capital Estimation 6.3 Source of Capital 6.4 Security of Loan 6.5 Loan Repayment Plan 6.6 Profit and Loss Statement 6.7 Cash flow Statement 6.8 Viability Analysis 7.0 Business Risk and mitigation factor 7.1 Business Risks 7.2 SWOT Analysis

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