Soybean oil is an important edible cooking oil globally. It is vegetable oil. Generally, it is produced from the seeds. Here in this article, we intend to explore how to start a soybean oil production business with a processing flow chart.
Some of the major soybean-producing countries are Uruguay, Bolivia, Ukraine, Canada, India, and China. India is Asia’s second-largest producer of soybeans.
And some of the major soybean-producing states are Maharashtra, Madhya Pradesh, Rajasthan, Andhra Pradesh, Karnataka, and Gujarat. India accounts for 3.95% of global production according to Statista.
Commercially, there are two methods for producing soyabean oil. You can produce the oil either by pressing or solvent extraction methods. Basically, the screw pressing method is a mechanical process. The process is complicated and the oil yield is much lower.
On the other hand, solvent extraction is a chemical process. It ensures a higher oil yield. Therefore, we strongly recommend going with the solvent extraction process.
Additionally, you can start the soybean oil production unit in two ways. One is only oil production. And you will send the oil to other oil refinery companies. Basically, you can start this type of unit with moderate capital investment.
Another way you can start the unit along with a refinery setup. However, this type of unit operates on a large scale and demands substantial capital investment.
Soybean Oil Market Potential
Basically, the oil has omega-3 fatty acids, polyunsaturated fats, and low saturated fats. Therefore, it is popular as one of the healthiest cooking oils. It currently represents the second largest (after palm oil) edible oil consumed in the world with the United States and China representing the largest markets.
The majority of its global demand currently comes from the food industry. Within the food industry, most of the demand is for cooking and as a condiment in salads.
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Also, the oil finds applications in industrial paints, lubricants, solvents, cleaners, adhesives, oleochemicals, biodiesel, biocomposites, etc.
Due to its high unsaturated fat content, it undergoes early oxidation upon exposure to air, light, or moisture – which makes it suitable for printing inks and oil paint formulations.
According to industry experts, the demand for soybean oil to grow at a CAGR of around 4% during the next five years.
Licensing & Permissions for Soybean Oil Production Unit
Basically, the requirement for specific licenses mainly depends on the finished product. First, determine whether you want to sell the solvent extracted oil or refined soybean oil. In addition, check your state law for further confirmation. Here, we have compiled some of the basic requirements.
- First of all, register your business and prepare the MOA.
- Apply for MSME Udyog Aadhaar online registration
- Obtain the NOC from the Pollution Control Board
- Apply for the commercial electricity connection & water supply
- Apply for the Factory License.
- Additionally, apply for the FSSAI license. You must maintain the standard according to the PFA Act.
- Finally, check the upcoming tax liabilities of the business.
- Apply for the GST registration number.
Select a Right Location
In starting a soybean oil production business, location plays a most important role. You must establish the unit near the soybean growing areas.
Because you have to ensure the supply of soy seeds at your factory without spending much transportation costs. Otherwise, you won’t be able to get the maximum profitability from the business.
Soybean Oil Production Plant Setup & Machinery
For establishing the plant, the primary requirement is the land. If you already have space for the manufacturing operation, then it is fine.
Otherwise, you can secure a space in any industrial zone on rent. Generally, a 2000 Sq Ft built-up area is sufficient for small-scale production. Some of the most important machines are
- Solvent extraction plant
Basically, a solvent extraction plant contains
- Seed Cleaner
- Aspiration system
- Roll Grinding attachment
- Hydraulic system
- Rotary Air Lock
- Feed Bin
- Micro-Level Indicators
- Rising Hoppers
- Discharge Bin
- Bulk Flow Conveyor
- Rotary Air Lock
- Dust Catcher
- Horizontal Tubular Condensor
- Sealing Devic
- Vapour Cooler,
- Water Solvent Separator
- Spent Water Desolventiser
- Oil Stripping Column
- Oil Holding Tank
- Vacuum Equipment
- Final Vapour Absorber
- Heat Exchangers
- Final Vertical Stripper
Soybean Oil Extraction Process by Solvent Extraction
The first step is cleaning the soy seeds. Then, dry the seeds and dehull prior to oil extraction. You have to remove the soybean hulls because they absorb oil and give a lower yield.
However, you can dehull by cracking the soybeans. Finally, separate the hulls and cracked soybeans mechanically. Additionally, you can use magnets to separate any iron particles from the soybeans.
The soybeans are also heated to about 75°C to coagulate the soy proteins to make the oil extraction easier. For extracting the oil cut the soybeans into flakes. Put them in a percolation extractor and immerse them with a solvent, normally hexane.
Counterflow is used as an extraction system because it gives the highest yield. After removing the hexane, the extracted flakes only contain about 1% of soybean oil and are used as a livestock meal or to produce food products such as soy protein.
Finally, separate the hexane from the soybean oil in evaporators. And recover the evaporated hexane and return it to the extraction process. Now, the hexane-free crude soybean oil is ready to go to the refineries.
Raw Materials for Soybean Oil Manufacturing
The most important raw material is soy seed. Additionally, you have to procure Hexane and other miscellaneous chemicals. In addition to that, you have to arrange packaging materials for bulk packaging purposes.
Soybean Oil Machine Price
The price of a soybean oil machine will depend on the type and the desired production output. The cost will range from 1 lac to 5 Lac per machine for a small-scale operation.
Editorial Staff at NextWhatBusiness is a team of Business Consultants having years of experience in small and medium scale businesses.