Castor (Ricinus communis) is a seed cultivated round the world because it’s oil and the commercial uses of oil derived from the seed,for the development of a Biodiesel.
Castor (Ricinus communis) is a seed cultivated round the world because it’s oil and the commercial uses of oil derived from the seed. Opportunity is numerous and Castor farmers could earn a lot over a minimum period of 7 years in which the castor seed could be cultivated.
Uses of Castor oil: Because of its tremendous demand from critical industries the current consumption and it’s derivatives worldwide is put at 3-4 million tons.
We have a business plan that covers the investment in the castor seed oil production,The investment package has extension to 10 years business development of plan that will operate among two primary alternative energy units: bio-fuel production and unrefined Castor oil.
The first aspect of the business’ operation, bio-fuel production, is readily becoming the number one alternative to standard diesel in the World whiles castor oil serves as raw material for various industries. Other byproducts namely glycerol and castor meal can also be sold.
We are seeking for an Investor / Lender for the development of a Castor oil refinery and a Bio-diesel Plant in Ghana. On a preliminary basis, the Lender will receive interest for the funds invested in the business.
Our Mission Statement remain to establish and produce a quality bio-diesel and castor oil for the Mining Industry, Cosmetic industry, Pharmaceutical Industry as well as the Aviation Industry.
We shall enjoy a monopoly in the castor business due to the fact that castor care Ghana is the first in the country.
We are seeking an investor who willing to invest in this viable business to contact us for more information and modality in which the future investor will like to operate with us.
Our most important competitive advantage is entering the market with quality products; bio-diesel / Castor oil supply industry with the most advanced technologies, gaining experience and market share before the intrusion of new competitors.
India is the leading producer of castor oil in the world, followed by China and Brazil. The present annual world trade in castor oil is estimated at about 3-4 million tons as indicated above. The major importers of castor oil in the world market are European Union, US and Japan. The world demand for castor oil is estimated to be growing at the rate of about 3 to 5 % per annum. Both Brazil and China have experienced a steady increase in their domestic castor oil consumption in the recent years and thus utilize almost their entire production. India consumes only a quarter of its castor oil production and exports the rest.
Based on research we conducted through phone calls and one-one conversation with traders of Castor oil, there is no indication of a competitor/producer of biodiesel made from castor plant as well as Castor Oil yet in Ghana. Most vendors of Castor oil imports into the country and are basically used for cosmetic and pharmaceutical purposes. The fact that we have no producer yet in Ghana, Our company will enjoy monopoly till other institution joins the market. Moreover, the increasing demand of Castor oil due to it uses might attract new entrant but there will be more room to accommodate new entrants without any serious damage to us. Just like the cultivation of Cocoa in Ghana, the more you produce the more your sales goes up, which implies that the efficiency and effective operations will determine the growth in profit for the firm.
With the global market, since the quantity demanded is lesser than the quantity supplied in a year, we will capitalize on this inefficiency to capture a portion of the vacant market not supplied.
Our team sees this business as a great opportunity and therefore wants to tap into it. Currently there is no company producing or has such an idea even though the plant is used by locals for medicinal and spiritual purposes.We will specialize in the Bio-diesel Industry and also supply unrefined castor oil to Pharmaceutical and Cosmetic Industries.
We expects that the business will aggressively expand during the third year of our operation with the assumption of a 50% increment on harvested seeds. The 50% increase is based on the maturity of the plant, improved expertise as well as the engagement of other local farmers. This will in effect increase the annual production unit of 9000 tons of oil per year to 13,500 tons of oil per year. We intend to implement marketing campaigns that will effectively target individuals (that use diesel engines), companies with large diesel fuel needs within the target market which includes the Mining Industry, Pharmaceutical and Cosmetic industry.
The marketing goals are geared towards becoming the first and leading producer and distributor of Bio-diesel/Castor oil and its related products in Ghana. For the goal to be achieved, we will work hard to meet the production of its expected minimum quantity of 9400 tons per year for the first two years, expand to 14100 tons per year from the third year and also sell all the quantity produced.
Castor estimate 800kg of seeds per acre which will account for a total of 20,000,000 kg. Out of this, 50% will be represented by oil whilst the other 50 will be meal/cake.
We also assume the 50% castor oil should contain 90% biodiesel and 10% glycerol after processing.
Our financials are based on achievable target considering a price lower than the market price of Castor oil per ton. The enterprise has decided to sell a ton of Biodiesel / unrefined castor oil between $950- $1150, this is relatively cheaper as compared to the international market. The team also decided to sell up to 9400 tons in the first 2 years and increase by 50% in the third year onwards. We estimate to sell all quantity produced by the end of the year.
We also assume to plant other edible crops among the Castor plants to also generate other source of revenue.
The Biodiesel Plant will have a constant annual revenue growth for the first two years and increase by 50% from year 3 - 5.
We will obtain $7,500,000.00 from its Lenders/ Investors.
We also assume to sell the by-product of Castor oil (Glycerol) and the Cake.
Cost of Operations: The operational cost of acquiring facilities, equipment, plants and machinery as well as the cost to find and retain qualified workers that are needed to effectively and efficiently oversee the operations of the business is very high. The costs in turn have made the bio-diesel industry a very capital intensive type with fewer players in this country or Africa at large.
The following lists the first year financing plan for castor plantation, details of budget for each are indicated in our business plan. The schedule indicates our emphasis on planning the implementation. The most important programs are castor seed cultivation (Stage 1 - Harvesting) and equipment installation.The list are:
1. Equipment orders will be possible after negotiations with producers of different parts and having completed the installation plan. This plan will be done by design institution using equipment producers’ drawings and specifications. Equipments include bio-diesel plant, Castor decorticator, Castor Expeller. Milestone’s budget is a cost of equipment (50%) plus cost of installation plan.
2. Quantity of agricultural tools needed was estimated for a farm with a total arable area of 10,000 hectares. This includes Tractors, Trucks, Planters and others.
3. Site preparation includes mainly construction works: fence, building, roofing, building bases for equipment and storage capacities, installation storage reservoirs, energy supply and fire detection equipment. These works will be performed by subcontractors.
4. We can start the oil processing right after site preparation, because this does not require complicated technology. So, installation of oil processing equipment (oil presses, filters, cisterns) and the offer of oil processing services can be started at the beginning of the year. (Milestone 12) We did not plan cash inflows from these services.
5. Farm preparation is soil fertilizing (depends on qualities of soil, may be omitted) and processing. Milestone’s budget includes costs of fuel, fertilizers, labor force and drilling or boreholes for irrigation.
6. Stage 1- Sowing of castor, fuel and labor force costs are assigned here.
7. Stage 2: Weeding or application of herbicides and fertilizers. Costs of herbicides and accelerators were included.
8. Harvesting will be done by farmers and other labourers (casual workers), because this stage requires more hands.
9. Dehulling of seeds will be concurrent with harvesting.
10. Payment of another 50% costs of equipment will be done after delivering it to the site, inspection, installation and testing. Works will be done by subcontractor (construction works) and equipment supplier. Budget includes costs of equipment, installation, labor force.
11. Equipment and maintenance includes works with electricity, water, air supply equipment, biodiesel processing equipment, and implies the testing and the improvements.
12. Oil processing costs include energy, labor force and maintenance.
13. Processing of bio-diesel is possible when sufficient (1000 tons) quantity of oil have been pressed. Costs include chemicals, energy and labor force.
We are seeking to raise $7,500,000 from an Investor / Lender for the development of a Castor oil refinery and a Bio-diesel Plant. On a preliminary basis, the Lender will receive interest for the funds invested in the business.
We expect full recovery of cost plus profit at the start of operations. We did not need investor hand-on,other than MOU agreement and legal documents to established the financing the investment.
All other modality of investor interest will be discussed with the investor on the suggestion on investment installment schedule.