Do you know that palm oil season has come? Yes, the time to store palm oil is now. We are in February and the price of palm oil has crashed from 22k to 18k-19k. And may possibly crash the more, but you can start storing because you never can tell, you may be thinking it will continue to drop and boom it sky rock. This day you can’t really say the price of foodstuff because as price is given to you by the time you turn your back the price has changed. But the price will remain low from now till ending of April before it goes up very much in May.
Where to buy palm oil for storage
There are few states that produces palm oil in large quantities. Some of the states are; Akwa Ibom, Cross River, Imo, Ebonyi, Abia, Ondo etc. There are people who stand as middlemen who link palm oil buyers to sellers, you can locate them or go to the states to buy.
How to start the storage
- Locate where to buy the palm oil, I have just mentioned some states, there are distributors who go to different starts for supplies. Ask traders if you are new in the business.
- Source for capital. You need money to do any business and this time you need good money for palm oil storage. This should include money for transportation, Buying of jerrycans and the palm oil.
- Prepare a place you will keep the oil until it is time to sell. The place suitable to keep stored palm oil is a room not exposed to sun or rain.
- Identify your target market. Buyers are on ground, do you know there is no day a family doesn’t use it to prepare food. So traders are everywhere. Buyers are always on ground to purchase, Wholesaler and distributors alike.
- Means of transportation: You have to put this in place before starting the business of palm oil storage. Truck is preferable because it is cheaper than other cars. If truck is charging 2k for a gallon others may charge 3k.
How profitable is palm oil storage
It is very lucrative, you can earn 40% to 50% of your capital. The good thing about it is that you can sell off all you goods in just one day and pocket both your capital and profit.
Should I take loan to store palm?
May answer is NO, apart from the fact that I don’t like this loan of a thing, it is better to take loan to grow an existing business than start a business. I remember in 2016, many people collected loans to store palm oil and that year glut sets in and the loss heavily instead of gaining. Well! that may possibly not happened but it is better to be on the safe side.
Challenges of palm business
I will only mention one challenge in this case, which is importation. Distributors import palm oil from Malaysia and other neighbouring countries. It infiltrate the country thereby crashing the price but with the way rate is flying I doubt such would happened this year.
