Oil palm, botanically known as Elaeis Guineensis, belongs to the family of plants called palmae. It is a group of oil crops cultivated for their valued seeds or fruits which contains oils that are extracted and used by man for both industrial and domestic purposes.
Oil palm is one of the most important economic crops in Nigeria. Between 1906 and 1913, record had it that it accounted for 82.1% of the total Nigerian Domestic Export, Usoro (1974) and up till 1978 where it earned the nation about 22% of her foreign exchange (Modebe;1978).
and may reach a height of 10m-30m. It has a trunk and leaves. The trunk
sometimes called a stipe is the stem of the palm. At the top of the stem (stipe
or trunk) is a bud- only one bud; this is the growing point of the palm, which
makes it live and grow. It produces extensive fibrous roots and grows long
fronds consisting of a large rachis from which leaflets originate. The fronds
are attached to the trunk by a thorny petiole. It is a monoecious plant bearing
both male and female flowers per plant. Each flower is grouped in spikes. When
the male flowers fertilize the female flowers, clusters consisting of spikelets
are formed. The spikelets contain the fruits which when processed, oil is
ORIGIN OF OIL PALM
about the origin of oil palm.
in the tropical rainforest region of West Africa, the main belt running through
the southern latitude of Cameroun, Cote d’ Ivoire, Ghana, Liberia, Nigeria,
Sierra Leone, Togo and into the equatorial region of Angola and the Congo.
and it does well on latitudes 15oN and 15o S of the
America, adding that it was introduced into the tropics (Africa) by slave
origin of oil palm, as a native to tropical Africa, stating that oil palm
fruits were only taken to the Americans during the 14th-17th centuries, and
from there to the Far East, which when it was planted appeared to have thrived
better in the Far East. Thus, providing the largest commercial production of an
economic crop far removed from its centre of origin. He went further to
elucidate the areas or countries that produce oil palm such as Dahomey, Angola,
Senegal, and Nigeria.
TRENDS IN OIL PALM PRODUCTION
main stay of the Nigerian economy. The agricultural sector, precisely,
production of cash crops such as cocoa, rubber, oil palm, contributed two-third
of the Gross Domestic Product (GDP) and sixty percent (60%) of her export
sector declined to almost 21%. In 1980, instability in agricultural policies
and increased earnings from petroleum (crude oil) affected the agricultural
sector adversely. The economy became heavily dependent on crude oil revenue to
represent 90% of foreign exchange earnings and about 85% of total export.
because of over-reliance on petroleum, while making agricultural (cash crop
production) sector inconsequential.
TYPES OF OIL PALM
The dura palms: this has thick shell
with a thin pericarp and a large kernel. When processed, it gives a relatively
low quantity of oil.
The tenera palms: this has a fairly
thick pericarp, (up to 60% of the fruit weight), a small kernel and thin shell.
It gives high quantity of oil when processed.
The pisifera palms: the fruits of this
palm have kernels with no shell. Though the kernels are tiny, surrounded with
fibres. Many of this variety are sterile. This still produces large quantity of
all, Tenera palm is the best because it produces large quantity of quality oil
and it is non-sterile.
But to get a lot of oil however, each fruit must
contain a lot of pulp (epicarp and mesocarp), a shell that is not very thick
and a big kernel.
varieties of oil palms which produce many large clusters with fruits that have
a lot of pulp, a thin shell and big kernel. This is achieved by crossing as
Dura x Dura = 100% Dura
Dura x Tenera = 50% Dura, 50% Tenera
Dura x Pisifera = 100% Tenera
Tenera x Pisifera = 25% Dura, 50% Tenera, 25%
Ternera x Tenera (Tenera selfed) = 50%
METHODS OF PROPAGATION
Oil palm is propagated by seed; there is high degree
of difficulty in getting the palm seeds that will germinate. This is due to the
difficulty with which moisture penetrates the seed coat S. A. Omoruyi et al,
1999. According to him, if water does not enter the seed, then nutrient
mobilization for the embryo will not take place, and germination will not
occur. In view to this, the oil palm seed is given special treatment before it
can germinate. There are two methods of doing this.
The nut (seed) to be germinated are kept
in a room where it is always very hot, or arranged on trays filled with
charcoal and kept in an incubator, maintained at a constant temperature of 35oCwhile
moistening the nuts in the trays at regular intervals. The nuts are examined
once a week. Germinated seeds (nuts) are removed to be planted in the nursery
A. A. Akerobo, 1999.
The second method involves soaking palm
fruits in water to depulp them. Thereafter, they are removed, washed clean and
shade-dried. The dried nuts are then placed in polythene bags and dry-heated in
a germination room for 80 – 90 days at temperature between 37oC to
40oC. After this, the seeds are removed and soaked again for seven
days, with daily change of water. The nuts are then returned to the polythene
bags and kept in cool places. Water is sprinkled on the nuts and is examined
about twice a week. Germination is achieved in about the third week.
LAND PREPARATION AND
These operations are;
- Planting in the nursery
- Planting in the field
Planting in the nursery: After germination, seedlings are first planted
in a pre-nursery where they remain for about four and half months (41/2
months), before planting in nursery. Seedlings can however be raised more
economically by the use of 400 – 500 guage black polythene bags measuring 30cm
wide and 40cm deep, filled with fertile soil. Seedlings in nursery are allowed
to grow for a further 6 – 12 months before they are transplanted into the
field, usually at the beginning of rainy season which is around March.
Seedlings in nursery are place at 45cm spacing, Asherio, 2002.
Planting in field: The bushes should be cleared, distance an d hole
measured and marked out. This is called field demarcation and pegging. The
holes arte then dug. Poly bag seedlings are best transplanted with all the soil
(earth) in the bag intact. In situation where the seedlings are planted in
nursery beds, it is best to lift them with a ball of earth which has been cut
some 6cm around the plant to protect the root from damage and shock, and soil
added and pressed down.
Note: When seedlings are to be transplanted to far distances, the ball of earth
method may make them too bulky to carry. The naked root method can be used. By
this method, the soil is shaken off the roots. To prevent dry-out however, the
roots are then dipped in clay suny and tied with moist grasses or dried banana
leaves. The planting distance is usually 9m triangular, giving about 150 palms
per hectare. Field planting is best done from March to early May, C. I.
Young palms should be protected from
rodents, such as grass cutters by a collar of wire netting, which has to be
removed when the palms have fully established.
CLIMATIC AND SOIL REQUIREMENT
Oil palm is mostly adapted to the regions between latitudes 15oN
and 12oS. It requires a temperature range between 24oC to
34oC, with a constant sunshine for the development for the female
flower. A rainfall range of 2, 000mm to 4, 000mm a year and well distributed is
adequate for good production. Oil palm requires rich well drained soils with PH
on acid side of neutrality (4.5 – 6), Ascherio A., (2002), Baily C. C., 2003.
requirements and applications.
in the ratio of 1:1:1:2, using ammonium sulphate, muriate of potash, single
super phosphate and magnesium sulphate is applied twice at the rate 55g per
seedling, when the seedlings are 2 and 8 months old. In field, yields will fall
rapidly if the soil nutrient extracted by the plant as well as through the
bunch are not replaced. Spread in broad bonds, for older palms.
Potassium is the most important and the most limiting nutrient for oil palm
production, potassium is an important constituent of the bunch, Usoro (1974),
the Nigerian Institute for Oil Palm Research (NIFOR), Uguru (2007). Excess
potassium induces magnesium deficiency in the soil. Thus potassium should be
controllably applied. Spread it in a ring form at 7.5cm away from the seedling
to avoid scorching the seedlings.
Maintenance and weed control:
Weed round each tree (ring weeding). Leguminous plants like pueraria and
centrosema can be planted to suppress weed in the plantation. The use of
herbicides proves very effective in oil palm plantation, Onuoghia; 2005.
Old and infected leaves should
be pruned and burnt on routine basis. Fresh or green leaves should never be
trimmed as the number of leaves on the palm tree has a direct relationship with
the yield of the plant, he added.
HARVESTING OF OIL PALM:
years after planting. According to Stephen and Osagie, 2007, oil palm fruits
are harvested when they begin to ripe (that is, when the bunch begins to lose
It is done by cutting down the
bunch using cutlass, a chisel or a special harvesting knife (sickle attached to
a long pole). For older palms, the bunch could be reached by using ladder or
climbing ropes/wires. Highest harvest occurs early in the beginning of rainy
season (March to April) while smaller harvest occur at the end of rainy season
(September to October).
PROCESSING OF OIL PALM FRUITS
According to Onuohia (2005), the immediate processing of the oil palm fruits is
very important as it leads to the production of good quality oil with reduced
free fatty acid (FFA) content. This is because the oil palm fruit is very rich
in latent enzymes, important among which is lipase. These enzymes are activated
as soon as the bunch is harvested and they work rapidly on the pericarp
triglycerides of the fruit, hydrolyzing the fatty acid from the glycerol. This
leads to a rapid increase in the amount of free fatty acid (FFA) in the fruits.
A high content of FFA leads to deterioration of the oil quality. This is why
traditional method of processing gives low quality oil as well as very low
percentage extraction achieved, Onuohia (2005).
The oil mills however, give the best result in terms of oil quality and
percentage extraction, Onuohia (2005).
Nyanwu et, al (2009) classified palm oil
into three (3) types, this was based on the method s of extraction. It
Hard oil – containing high free fatty acid (HFFA)
Soft oil – containing low free fatty acid (LFFA)
Special oil – containing very low free fatty acid (VLFFA)
Methods of palm oil processing
i. Local (traditional) method
ii. Modern method
i. Local method: in small-scale palm oil production, the use of local
(traditional) method is common to present farmers. Nigeria Institute for oil palm
Research, (NIFOR), estimated that about 250 tons of palm oil is lost annually
due to traditional processing method employed by majority oil palm producers,
Oluwasanmi (2007). According to him, these procedures are as follows: Cut the
bunch into pieces and cover with materials for some days to allow it loosen its
fruits, then mesh to extract the fruit. The fruits are then boiled and pounded
in a mortar, the fibre and nuts are removed and the oil is separated from the
residue by floatation after mixing with water. The crude liquid is then
re-boiled and oil carefully separated (skimmed). The oil is later reheated to
remove any traces of water.
According to Uguru (2007), modern method (the oil mill method), involves
– Sterilization: This helps to soften the fruits for stripping from the
bunch, and for milling, to kill any disease pathogens and stops the action of
the lipolytic enzymes which increases the FFA content.
– Stripping: this is the removal of the fruits from the Bunche;
thereafter the fruits are heated or boiled for about 30 – 45 minutes.
– Milling (pounding): This involves pounding the fruits to separate the
mesocarp from the nut. This is done by the use of horizontal digester or the
macerator. It is called depulping
– Pressing: This is the pressing out of the liquid from the macerated
mass. Pressing can be done using:
– The screw hand press
– Hydraulic press or,
– The centrifugal press. The nuts are
removed from the fibrous-mass while the liquid is sent to the next stage
– Clarification: This is the separation of the pure oil from the water
and sludge (impurities). The process involves boiling and skimming. He added
that clarification is more effective when hand or hydraulic press is used.
– Storage: Oil palm can be stored in drums, tins or plastic cans.
The extracted nuts are dried in the sun. The kernel, extracted by cracking the
nuts (either manually or mechanically) are then dried and stored in bags or
ECONOMIC IMPORTANCE AND USES OF OIL PALM PRODUCTS
Oil palm tree is so unique that virtually all the parts are useful. The trunk
(stem) serves as a valuable source of timber, for use as pillars and beams, or
can be sawed into planks and used for construction and building. According to
Ajakaire, (1997), the leaves (fronds) are used for roofing and thatching, the
fibre, used in rope and basket production. The leaflets are used in broom
making for domestic purposes. The whole fronds, however is used for fencing and
The palm oil with high FFA, referred to as industrial oil is used for making
soap, candle, while those with low FFA are used for cooking, manufacture of
margarine and vegetable oils. The palm kernel oil is used in making local
pomade and palm kernel cake for feeding livestock, Oluwasanmi,
( 2007). The shells which result from cracking of the nuts are used in
concrete making, as source of fuel, and to check or control erosion, Onuohia, ( 2008).
The palm wine is a refreshing drink, rich in yeast and Vitamin B. Palm wine can
be distilled to produce local gin.
The bunches, after removing the fruits can be burnt and used in making native
soap, Oluwasanmi, (2007). They are good source of manure to the palms, being
very rich in potassium content. The fibrous pulp inside the bunch is used in
making foot mats. The fibrous residues obtained after pressing out the oil
(mesocarp) are good source of fuel.
Generally, oil palm production had being a good source of food, income,
industrial raw materials and employment to the jobless, Onuohia, (2005).
PROBLEMS AND PROSPECT OF OIL PALM
The following are the problems
militating against oil palm production in Nigeria. These are:
1. Problem of finance: Majority of our local farmers are poor. Credits
are not easily made available to them, aas well as some private sectors because
they cannot provide the collateral security which commercial banks or credit
institutions demand. There is also a problem of high interest rate which rural farmers cannot cope with. Hence, they
are discouraged, S. A. Omorayi, (1990).
2. Lack of interest and education: Many individual farmers and
government sectors don’t seem to be keen in investing in long-term projects,
like oil palm plantation and production. But in projects that attracts
immediate financial benefits, such as trading on agricultural products. This is
because of poor formal education and orientation.
3. Climatic problem: High yields are rarely achieved in practice. This
is because erratic rainfall pattern, sunshine and temperature regime in central
and West African regions (Nigeria). Oil Palm trees suffer water-related
Some times the effect of weather, such as thunder, and lightening could be an
impediment to already existing palm tree, causing their premature death or
delay in yield for years.
4. Pest and diseases: Prospective farmers (oil palm investors) are being
discouraged because of pest and diseases prevalence in Nigeria. Diseases and
pests cause reduction in productivity and yield of oil palm. Many palms show
symptoms of collar rot diseases (NIFOR).
5. Land tenure system: Individual and commercial system of land
acquisition had hampered oil palm production in Nigeria. As population
increases, land fragmentation creeps in, such that land becomes unavailable.
6. Poor processing and storage facilities: and over dependence on
petroleum (crude oil) are other factors militating against oil palm production.
POSSIBLE SOLUTIONS TO THE PROBLEMS OF OIL PALM PRODUCTION
on the needs and importance of oil palm production should
be conveyed to farmers. In this light, government should grant loans and
credits to prospective oil palm investors and
subsidize the price of input (such as fertilizers, machines, herbicides,
irrigation and drainage facilities). Government should engage in Land use Act and Land use Decree, provide
good and affordable processing and storage equipment’s, as well as providing
high strain and disease resistance varieties.
seen the economic importance and uses of oil palm, I wish to recommend that
government should see oil palm production as a lucrative business, an
investment forum that would alleviate the masses from poverty line to a higher
standard of living.
Private investors however should be encouraged and
assisted by the government to carry on oil palm production.
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- SECTION I – EXECUTIVE SUMMARY
- NAME OF BUSINESS / COMPANY
- OFFICE & SITE LOCATION
- MISSION STATEMENT
- SOCIAL/ECONOMIC VALUE
- PROJECT STATUS & START UP
- WHY PREPARE THIS BUSINESS PLAN?
- SECURITIES FOR THE PROPOSED LOAN
- SECTION II – STUDY AREA
- STUDY AREA
- COMPANY OVERVIEW
- MANAGEMENT TEAM
- DEPARTMENTS IN THE COMPANY
- MANAGEMENT TEAM GAPS
- SECTION III – INDUSTRY ANALYSIS
- DEFINING YOUR INDUSTRY
- YOUR INDUSTRY SIZE GROWTH RATE AND SALES PROJECTIONS
- INDUSTRY STRUCTURE
- MARKET OVERVIEW
- MARKET SEGMENTATION
- RELEVANT MARKET SIZE
- KEY SUCCESS FACTORS
- LONG TERM PROSPECTIVE
- MARKET CHARACTERISTICS
- SAMPLING TECHNIQUE
- SECTION IV – CUSTOMER ANALYSIS
- TARGET CUSTOMERS
- CUSTOMER NEEDS
- MARKET NEEDS / SOCIAL PROBLEMS AND SOLUTIONS
- BUYERS BEHAVIOUR
- MARKET SHARE
- SALES FORECASTING
- SECTION V – COMPETITIVE ANALYSIS
- DIRECT COMPETITORS
- COMPETITIVE ADVANTAGES
- SECTION VI – MARKETING PLAN
- PRODUCTS & SERVICES
- FINISHED PRODUCTS
- PRODUCT QUALITY AND PRODUCTION QUANTITY
- PRODUCTION CAPACITY
- PROMOTIONS PLAN
- DISTRIBUTION PLAN
- SECTION VII – OPERATIONS PLAN
- GENERAL APPROACH TO PRODUCTION
- TECHNICAL ANALYSIS / PRODUCTION PROCESS
- PACKAGING REQUIREMENTS
- SECTION VIII – FINANCIAL PLAN
- REVENUE MODEL
- FINANCIAL ANALYSIS
- FINANCIAL ASSUMPTIONS
- FINANCE CHARGES
- FINANCIAL PROJECTIONS
- FUNDING REQUIREMENTS/USE OF FUNDS
- CRITICAL ASSUMPTIONS
- FINANCIAL MODELS
- SUMMARY OF PROJECT COST
- BUDGET OF FIXED ASSETS / CAPITAL EXPENSES / INVESTMENTS
- OPERATING EXPENSES (OPEX)
- TOTAL REQUIRED INVESTMENT OUTLAY (REQUIRED START-UP CAPITAL)
- FINANCING PLAN
- INSTALLED / AVAILABLE EQUIPMENT
- BREAK-EVEN ANALYSIS
- LOAN REPAYMENT SCHEDULE AND INTEREST PAID
- FORECAST OF PROFIT AND LOSS
- CASH FLOW
- BALANCE SHEET
- GENERAL ASSUMPTIONS (BREAK EVEN ANALYSIS)
- BUSINESS RATIOS – PROFITABILITY ANALYSIS
- SECTION 3 – APPENDIX
These Feasibility study on poultry farming business (specializing on layers and boilers production), was conducted using projections, impressive publications, compounding interest/values, tables, graph, bar chart, pie chart, profits analysis and cash flow positions in other to give a clear picture of what is obtainable in that location, using eight plots of land, at Esemdiary village, Off Effurun Sapele Road, Okpe LGA of Delta state, Nigeria as a case study.
Esemdiary village is a community in Okpe Local Government Area of Delta State with coordinates 05°26’N 5°57’E, which also plays the host community to the Warri Airport, which is actually located at Osubi.
Okpe Local Government is a territory that used to be part of the original Okpe Kingdom, its headquarters is at Orerokpe, with a population of 128,398 people whose primary occupations include commercial farming, fishing, hunting, trading and gas exploration.
After carrying out the feasibility study on Esemdiary village, Off Effurun-Sapele Road, Okpe LGA of Delta state, Nigeria, it was discovered that, farming generally will do well both on crop and animal production.
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