Neem Oil Extraction | Profitable Small Business Idea

Neem oil extraction business opportunity demands adequate knowledge about oil extraction process. There are several techniques used in the industrial and commercial extraction of neem oil. Neem oil extraction using solvent like alcohol, ether and hydrocarbons is the most used process in the industry. The choice of neem oil extraction process depends on the nature of chemical compound that’s being extracted.

Commercially produced neem oil by treated with solvent does not contain Azadirachtin. This type of neem oil is not suitable for use on certified organic crop. Different process of oil extraction produces different compositions of neem oil. It all depends on the usage and the purpose of the extracted neem oil.

An entrepreneur having experience in neem oil industry can initiate this venture with substantial capital investment.

Neem Oil Application in Several Industries

The main application of neem oil is in agriculture. In agriculture industry, neem oil is generally used as the natural pesticide, insecticide, and fungicide. Containing with different ppm azadirachtin in neem oil, it is used for different purpose in different dosages. Another industrial use is neem coated chemical fertilizer like urea.

Other than agriculture neem oil has a wide market potential in cosmetic industry. In manufacturing a large number of skin care, hair care, body care product neem oil is an essential raw material. In ayurvedic cosmetic industry which is now booming, neem oil is an essential ingredient.

Nem oil is also an essential product in herbal medicine industry.

Business Plan for Neem Oil Extraction

As any manufacturing establishment business plan is an effective tool to have in neem oil extraction. According to the market study report determine what type of neem oil you will be extracting. It also helps you to determine the appropriate method and machinery. It is advisable to have a project report in hand before starting. It will also help you to calculate your startup capital requirement. Craft a business feasibility report on the basis of that. Determine your marketing strategy.

Legal Compliances for Neem Oil Extraction

In initiating neem oil extraction business you need to first determine the legal pattern of your business. You can consider to start with limited expenses and can register your business as OPC. Register your business as SSI Unit. You will need to obtain trade license from local authority. You need to have ‘consent to establish’ and ‘consent to operate’ permission from Pollution Control Board of your region. For certain use of neem oil such as in agriculture, BIS registration is mandatory.

Manufacturing Process and Machinery for Neem Oil Extraction

Mechanical Pressing Method

Primary process of extraction consists of grade wise separation of seeds. Grading of seeds is done according to the amount of oil content in the seeds and with sizes as well. Firstly, the fruits are collected in a drum, and the kernels are separated to obtain the seeds. Later the seeds are woven dried and then feed into the oil extracting machine in case of mechanical pressing method. The neem oil is obtained by pressing it mechanically and collected in a drum. Thus filtration is done to remove the various unwanted particles left in the extracted oil in order to obtain pure neem oil.

Solvent Extraction Method

In solvent extraction method, solvents like petrol or white gasoline is mixed with the seeds after woven drying. The solvents help in extracting the neem oil out of the kernel up to certain percent. Added to that the neem seeds are pressed if needed. The resulting oil is stored in a silo where the pure neem oil is recovered from the crude one. 

Promotion of Neem Oil Extraction Business

Concentrate to have business tie ups with the industries that use neem oil as raw material. It is always advisable to launch at least one product with your brand name in retail. Create your own website with a blog. Register your business with the popular B2B portals. Concentrate in establishing a strong distribution channel for your product.