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[Pdf Sample] Palm Oil Farming & Production Business Plan Docx
In the journey of palm oil production, starting from the nursery stage all the way to planting, oil extraction, processing, and eventually selling, the palm oil industry has garnered significant attention. Entrepreneurs and investors alike are increasingly drawn to this versatile and widely-used commodity.
To embark on this venture successfully, it is crucial to have a well-structured business plan that encompasses every aspect of the process. In this article, we will delve into the essential components of a business plan for palm oil production , covering everything from the initial nursery stage to the final selling process.
By understanding these key elements, you can lay a solid foundation for your palm oil production venture and maximize its potential for success.
[Pdf Sample] Business Plan Proposal For Palm Oil Production Docx
Table of Contents
To write a business plan , here is a breakdown of how it should be structured and what should be in each category. After this instruction, I will provide you with a sample of one I wrote for my farm , let us go:
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The executive summary serves as an introduction to your business plan , providing a concise overview of your palm oil production venture. It should highlight the key aspects of your business, such as the mission statement, objectives, target market, competitive advantages, and financial projections.
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In this section, provide a detailed description of your palm oil production company. Include information about its legal structure, location, history, key personnel, and any unique features or innovations that set your venture apart from competitors. Emphasize the vision and values that drive your business.
Conducting a thorough market analysis is crucial to understanding the palm oil industry and identifying opportunities for growth . Assess the demand and supply dynamics of the market, analyze the competitive landscape, and identify key trends and drivers affecting the industry. Additionally, determine your target market segments and outline your marketing strategies to effectively reach and engage customers.
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Detail the production process involved in palm oil production. Explain the cultivation and harvesting of oil palm trees , the extraction methods used to obtain palm oil, and the processing techniques for refining and packaging the final product. Highlight any sustainable practices or certifications that you plan to incorporate into your production process, as environmental considerations are gaining increasing importance in the industry.
Marketing and Sales Strategy
Developing an effective marketing and sales strategy is crucial for positioning your palm oil brand in the market and attracting customers. Identify your target audience, outline your unique selling propositions, and describe your pricing strategy. Additionally, explore various distribution channels, such as wholesalers, retailers, and online platforms, to reach a wide customer base.
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The operational plan outlines the day-to-day activities and resources required to run your palm oil production venture efficiently. Define the roles and responsibilities of key personnel, describe the equipment and infrastructure needed, and establish quality control measures. It is also essential to consider sustainability practices, waste management , and compliance with local regulations and certifications.
Provide comprehensive financial projections for your palm oil production business. This section should include income statements, balance sheets, and cash flow forecasts. Highlight the initial investment required, expected revenue streams, production costs, and operating expenses. Conduct a break-even analysis and assess the profitability and return on investment potential of your venture.
Risk Assessment and Mitigation
Identify potential risks and challenges that could impact the success of your palm oil production business. Assess market risks, such as price fluctuations and changes in consumer preferences, as well as operational risks, such as equipment breakdowns or supply chain disruptions. Develop strategies to mitigate these risks and outline contingency plans to ensure business continuity.
Here is the Download Link To Business Plan For Palm Oil Farming And Oil Production Proposal Pdf
What are the main components of a business plan for palm oil production?
A business plan for palm oil production typically includes an executive summary, company overview, market analysis, production process, marketing and sales strategy, operational plan, financial projections, and risk assessment.
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How can I identify my target market in the palm oil industry?
To identify your target market, conduct market research to understand consumer preferences, demand trends, and the competitive landscape. Consider factors such as demographics, geographical location, and target industry sectors.
What certifications are important for sustainable palm oil production?
Certifications such as Roundtable on Sustainable Palm Oil (RSPO) and International Sustainability & Carbon Certification (ISCC) are important for sustainable palm oil production. They demonstrate your commitment to environmental and social responsibility.
How can I mitigate risks in palm oil production?
To mitigate risks in palm oil production, develop contingency plans, establish robust quality control measures, diversify your customer base, and stay updated on market trends and regulatory changes. Additionally, invest in preventive maintenance for machinery and establish strong supplier relationships.
Where can I find more information about starting a palm oil production venture?
For more information about starting a palm oil production venture, you can consult industry associations, attend relevant conferences and trade shows, and explore online resources from reputable organizations such as the Malaysian Palm Oil Board (MPOB) and the Indonesian Palm Oil Association (GAPKI).
In conclusion, a well-crafted business plan is essential for anyone looking to establish a successful palm oil production venture. It provides a roadmap for your business, ensuring that you have a clear vision, defined strategies, and a thorough understanding of the market and operational requirements. By incorporating sustainable practices, embracing innovation, and addressing potential risks, you can position your palm oil production business for long-term growth and profitability .
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Palm Oil Production Business Plan: How to Setup for Good Profits
Table of contents, what is palm oil, need for palm oil, why start a palm oil production business, setting up a palm oil plantation, process of palm oil production, harvesting process, how to start a palm oil production business, palm oil production business plan template, marketing and sales strategy, financial plan.
The palm oil production business plan is a comprehensive guide that covers all aspects of starting a palm oil production business. This includes the feasibility study, market research, financial projections, and more. The palm oil production business plan is a valuable resource for entrepreneurs who want to enter the palm oil industry.
It provides important information on the market, competition, and strategies for success. This business plan will help you make informed decisions about starting a palm oil production business. It is essential reading for anyone considering this type of venture.
Palm oil production business plan
It is an edible vegetable oil derived from the fruit of the oil palm tree. It is the world’s most widely produced edible oil and is used in various food products, cosmetics, and biofuels. However, palm oil production is a complex and capital-intensive process requiring significant land, labor, and infrastructure investment. Therefore, a palm oil production business plan must consider these factors to succeed.
The first step in starting a palm oil production business is to acquire the necessary land and infrastructure. This can be done by leasing, purchasing existing plantations, or by developing new plantations. The next step is to hire the labor force to operate the plantation and process the palm fruit into crude palm oil (CPO). Finally, the CPO must be refined into finished products such as cooking oil, biodiesel, or other end uses.
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A successful palm oil production business plan will consider these costs and factor them into a comprehensive financial model. The model should include detailed assumptions about yield, operating costs, capital costs, selling prices, and other relevant factors. With this information, investors can make informed decisions about whether or not to proceed with a particular palm oil production project.
As the population continues to grow across the globe, so does the demand for food. To meet this demand, farmers are increasingly turning to palm oil as a source of vegetable oil. Palm oil is a type of edible (cooking) oil extracted from the fruit of the African oil palm tree. It is high in saturated fats and has several uses, including cooking, cosmetics, and biofuel. The demand for palm oil has grown significantly in recent years as it is seen as a more efficient and sustainable option than other vegetable oils.
It takes less land to produce palm oil than other oils, such as soybean or rapeseed oil, making it more environmentally friendly. In addition, palm oil can be produced with little or no water, making it ideal for countries that experience water shortages. However, palm oil production has come at a cost to the environment. Clearing rainforests for palm plantations has contributed to deforestation and climate change.
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In addition, pesticides and fertilizers on these plantations can pollute rivers and groundwater. There are also concerns about the working conditions on some plantations, where workers may be exposed to hazardous chemicals or forced to work long hours for low wages. Despite these concerns, palm oil remains an essential part of the global economy and will likely continue to play a role in meeting the world’s growing demand for food.
There are many reasons to start a palm oil production business. Palm oil is versatile and healthy oil used in various products. It is also a sustainable source of income for smallholder farmers and can help improve rural communities’ livelihoods. Starting a palm oil business can be a viable and profitable venture for entrepreneurs looking to make a difference in the world.
Palm oil production can help create jobs, provide economic opportunities in rural areas, and contribute to developing more sustainable supply chains. In addition, palm oil businesses can promote best practices in palm oil production and sustainability, which can help protect this important natural resource.
A palm oil plantation is a large farm that produces palm oil. This palm oil is a vegetable oil extracted from palm trees’ fruits. It is used in cooking and also as a biofuel. To set up a palm oil plantation, you must acquire land, obtain financing, plant trees, and hire workers. The process can take several years and requires significant investment. But once operational, a palm oil plantation can be a profitable enterprise.
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The process of palm oil production is a long and complicated one. It begins with the harvesting of fruit from palm trees. The fruit is then transported to a mill, where it is crushed, and the oil is extracted. The extracted oil is then transported to a refinery and refined into palm oil. The refined palm oil is then transported to a fractionation plant and fractionated into various oil grades. The different grades of palm oil are then transported to buyers who use them for various purposes. Palm oil is used in different products, including cosmetics, soaps, detergents, and margarine.
The harvesting process of palm oil production is a complex and labor-intensive operation. It involves using large machines to extract the oil from the palm fruits and a great deal of manual labor. The process begins with the collection of ripe palm fruits from the trees. These fruits are then transported to the mill, where they are crushed and pressurized to extract the oil.
After the palm oil has been extracted, it is refined and processed into various products. These products are then shipped to customers around the world. The entire process of palm oil production is quite complex and requires a great deal of planning and coordination.
If you are looking to start a palm oil production business, there are a couple of things you need to know. First, palm oil is a type of vegetable oil derived from the fruit of the oil palm tree. It is used in various products, including food, cosmetics, and biodiesel fuel. The first and foremost thing you need to do when starting a palm oil production business is to create a business plan. This will help determine the costs and benefits of starting your own business.
You will also need to find a suitable location for your business. Living in an area with many palm trees will be easier than living without them. Once you have your business plan and location, you must purchase the necessary equipment. This includes an oil press, extraction machine, and refining machine. You will also need to buy palm fruits from farmers or suppliers. Once you have your equipment and raw materials, you can produce palm oil.
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The fruit must first be harvested from the trees to produce palm oil. This is done by hand or with the use of machines. The next step is extracting the fruit oil using an extraction machine. After the oil has been extracted, it has to go through refining process before it can be used in products or sold as fuel.
If you’re looking to start a palm oil production business, you’ll need a comprehensive business plan. Luckily, we’ve got a template that will help you get started. This palm oil production business plan template includes an executive summary, company overview, market analysis, financial projections, and more.
With this template, you can quickly and easily develop a professional business plan for your new venture. To start your palm oil production business plan, download the template and fill in the necessary information. Once you’re finished, you’ll have a professional document to help secure funding and get your business off the ground.
The marketing and sales strategy for a palm oil production business plan should include a detailed analysis of the target market, the competition, and the company’s strengths and weaknesses. The plan should also include a sales forecast, a marketing budget, and a timeline for implementing the marketing and sales strategy.
A well-written business plan for a palm oil production company should include a detailed financial plan. This financial plan should include a section on the company’s current financial situation and future income and expenses projections. The financial plan should start with a brief overview of the company’s current financial situation.
In case you missed it: Argan Oil Project Report, Business Plan
This overview should include the company’s revenue, expenses, and cash flow. It should also discuss the company’s existing debts and assets. Next, the financial plan should provide projections for the company’s future income and expenses. These projections should be based on realistic assumptions about the future palm oil market and its costs.
The projections should show how much money the company will likely make or lose over the next few years. Finally, the financial plan should include a discussion of the risks that could affect the company’s ability to meet its financial goals. These risks could include changes in palm oil prices, unexpected increases in production costs, or delays in getting new palm oil plantations up and running.
A palm oil production business can be a very lucrative venture. With the right business plan in place, you can reap the benefits of this highly profitable industry. However, it is essential to research and develop a solid plan before getting started. This will help you avoid potential pitfalls and ensure your business is booming.
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How to write a business plan for a palm oil producer?
Putting together a business plan for a palm oil producer can be daunting - especially if you're creating a business for the first time - but with this comprehensive guide, you'll have the necessary tools to do it confidently.
We will explore why writing one is so important in both starting up and growing an existing palm oil producer, as well as what should go into making an effective plan - from its structure to content - and what tools can be used to streamline the process and avoid errors.
Without further ado, let us begin!
In this guide:
Why write a business plan for a palm oil producer?
- What information is needed to create a business plan for a palm oil producer?
- How do I build a financial forecast for a palm oil producer?
The written part of a palm oil producer business plan
- What tool should I use to write my palm oil producer business plan?
Having a clear understanding of why you want to write a business plan for your palm oil producer will make it simpler for you to grasp the rationale behind its structure and content. So before delving into the plan's actual details, let's take a moment to remind ourselves of the primary reasons why you'd want to create a palm oil producer business plan.
To have a clear roadmap to grow the business
It's rarely business as usual for small businesses. The economy follows cycles where years of growth are followed by recessions, and the business environment is always changing with new technologies, new regulations, new competitors, and new consumer behaviours appearing all the time...
In this context, running a business without a clear roadmap is like driving blindfolded: it's dangerous at best. That's why writing a business plan for a palm oil producer is essential to create successful and sustainable businesses.
To write an effective business plan, you will need to take stock of where you are (if you are already in business) and where you want the business to go in the next three to five years.
Once you know where you want your palm oil producer to be, you'll have to identify:
- what resources (human, equipment, and capital) are needed to get there,
- at what pace the business needs to progress to get there in time,
- and what risks you'll face along the way.
Going through this process regularly is beneficial, both for startups and existing companies, as it helps make informed decisions about how best to allocate resources to ensure the long-term success of the business.
To maintain visibility on future cash flows
Businesses can go for years without making a profit, but they go bust as soon as they run out of cash. That's why "cash is king", and maintaining visibility on your palm oil producer's future cash flows is critical.
How do I do that? That's simple: you need an up-to-date financial forecast.
The good news is that your palm oil producer business plan already contains a financial forecast (more on that later in this guide), so all you have to do is to keep it up-to-date.
To do this, you need to regularly compare the actual financial performance of your business to what was planned in your financial forecast, and adjust the forecast based on the current trajectory of your business.
Monitoring your palm oil producer's financial health will enable you to identify potential financial problems (such as an unexpected cash shortfall) early and to put in place corrective measures. It will also allow you to detect and capitalize on potential growth opportunities (higher demand from a given segment of customers for example).
To secure financing
Whether you are a startup or an existing business, writing a detailed palm oil producer business plan is essential when seeking financing from banks or investors.
This makes sense given what we've just seen: financiers want to ensure you have a clear roadmap and visibility on your future cash flows.
Banks will use the information included in the plan to assess your borrowing capacity (how much debt your business can support) and your ability to repay the loan before deciding whether they will extend credit to your business and on what terms.
Similarly, investors will review your plan carefully to assess if their investment can generate an attractive return on investment.
To do so, they will be looking for evidence that your palm oil producer has the potential for healthy growth, profitability, and cash flow generation over time.
Now that you understand why it is important to create a business plan for a palm oil producer, let's take a look at what information is needed to create one.
Information needed to create a business plan for a palm oil producer
You need the right data in order to project sales, investments and costs accurately in the financial forecast of your palm oil producer business plan.
Below, we'll cover three key pieces of information you should gather before drafting your business plan.
Carrying out market research for a palm oil producer
Before you begin writing your business plan for a palm oil producer, conducting market research is a critical step in ensuring precise and realistic financial projections.
Market research grants you valuable insights into your target customer base, competitors, pricing strategies, and other crucial factors that can impact the success of your business.
In the course of this research, you may stumble upon trends that could impact your palm oil producer.
Your market research may reveal that there could be an increasing demand for certified organic palm oil products. Additionally, it could also reveal that there might be a trend of customers preferring sustainably-sourced palm oil products.
Such market trends play a pivotal role in revenue forecasting, as they provide essential data regarding potential customers' spending habits and preferences.
By integrating these findings into your financial projections, you can provide investors with more accurate information, enabling them to make well-informed decisions about investing in your palm oil producer.
Developing the marketing plan for a palm oil producer
Before delving into your palm oil producer business plan, it's imperative to budget for sales and marketing expenses.
To achieve this, a comprehensive sales and marketing plan is essential. This plan should provide an accurate projection of the necessary actions to acquire and retain customers.
Additionally, it will outline the required workforce to carry out these initiatives and the corresponding budget for promotions, advertising, and other marketing endeavours.
By budgeting accordingly, you can ensure that the right resources are allocated to these vital activities, aligning them with the sales and growth objectives outlined in your business plan.
The staffing and equipment needs of a palm oil producer
As you embark on starting or expanding your palm oil producer, having a clear plan for recruitment and capital expenditures (investment in equipment and real estate) is essential for ensuring your business's success.
Both the recruitment and investment plans must align with the timing and level of growth projected in your forecast, and they require appropriate funding.
A palm oil producer might incur staffing costs such as salaries for agricultural workers, supervisors, and administrative staff. Additionally, they might incur equipment costs such as tractors, harvesters, and other heavy machinery needed to plant, maintain, and harvest the palm oil. They might also need to purchase pesticides, fertilizers, and other farm supplies to ensure optimal production.
To create a realistic financial forecast, you also need to consider other operating expenses associated with the day-to-day running of your business, such as insurance and bookkeeping.
With all the necessary information at hand, you are ready to begin crafting your business plan and developing your financial forecast.
What goes into your palm oil producer's financial forecast?
The objective of the financial forecast of your palm oil producer's business plan is to show the growth, profitability, funding requirements, and cash generation potential of your business over the next 3 to 5 years.
The four key outputs of a financial forecast for a palm oil producer are:
- The profit and loss (P&L) statement ,
- The projected balance sheet ,
- The cash flow forecast ,
- And the sources and uses table .
Let's look at each of these in a bit more detail.
The projected P&L statement
The projected P&L statement for a palm oil producer shows how much revenue and profits your business is expected to generate in the future.
Ideally, your palm oil producer's P&L statement should show:
- Healthy growth - above inflation level
- Improving or stable profit margins
- Positive net profit
Expectations will vary based on the stage of your business. A startup will be expected to grow faster than an established palm oil producer. And similarly, an established company should showcase a higher level of profitability than a new venture.
The projected balance sheet of your palm oil producer
The balance sheet for a palm oil producer is a financial document that provides a snapshot of your business’s financial health at a given point in time.
It shows three main components: assets, liabilities and equity:
- Assets: are resources owned by the business, such as cash, equipment, and accounts receivable (money owed by clients).
- Liabilities: are debts owed to creditors and other entities, such as accounts payable (money owed to suppliers) and loans.
- Equity: includes the sums invested by the shareholders or business owners and the cumulative profits and losses of the business to date (called retained earnings). It is a proxy for the value of the owner's stake in the business.
Examining the balance sheet is important for lenders, investors, or other stakeholders who are interested in assessing your palm oil producer's liquidity and solvency:
- Liquidity: assesses whether or not your business has sufficient cash and short-term assets to honour its liabilities due over the next 12 months. It is a short-term focus.
- Solvency: assesses whether or not your business has the capacity to repay its debt over the medium-term.
Looking at the balance sheet can also provide insights into your palm oil producer's investment and financing policies.
In particular, stakeholders can compare the value of equity to the value of the outstanding financial debt to assess how the business is funded and what level of financial risk has been taken by the owners (financial debt is riskier because it has to be repaid, while equity doesn't need to be repaid).
The projected cash flow statement
A cash flow forecast for a palm oil producer shows how much cash the business is projected to generate or consume.
The cash flow statement is divided into 3 main areas:
- The operating cash flow shows how much cash is generated or consumed by the operations (running the business)
- The investing cash flow shows how much cash is being invested in capital expenditure (equipment, real estate, etc.)
- The financing cash flow shows how much cash is raised or distributed to investors and lenders
Looking at the cash flow forecast helps you to ensure that your business has enough cash to keep running, and can help you anticipate potential cash shortfalls.
It is also a best practice to include a monthly cash flow statement in the appendices of your palm oil producer business plan so that the readers can view the impact of seasonality on your business cash position and generation.
The initial financing plan
The initial financing plan, also known as a sources and uses table, is a valuable resource to have in your business plan when starting your palm oil producer as it reveals the origins of the money needed to establish the business (sources) and how it will be allocated (uses).
Having this table helps show what costs are involved in setting up your palm oil producer, how risks are shared between founders, investors and lenders, and what the starting cash position will be. This cash position needs to be sufficient to sustain operations until the business reaches a break-even point.
Now that you have a clear understanding of what goes into the financial forecast of your palm oil producer business plan, let's shift our focus to the written part of the plan.
The written part of a palm oil producer business plan is composed of 7 main sections:
- The executive summary
- The presentation of the company
- The products and services
- The market analysis
- The strategy
- The operations
- The financial plan
Throughout these sections, you will seek to provide the reader with the details and context needed for them to form a view on whether or not your business plan is achievable and your forecast a realistic possibility.
Let's go through the content of each section in more detail!
1. The executive summary
The executive summary, the first section of your palm oil producer's business plan, serves as an inviting snapshot of your entire plan, leaving readers eager to know more about your business.
To compose an effective executive summary, start with a concise introduction of your business, covering its name, concept, location, history, and unique aspects. Share insights about the services or products you intend to offer and your target customer base.
Subsequently, provide an overview of your palm oil producer's addressable market, highlighting current trends and potential growth opportunities.
Then, present a summary of critical financial figures, such as projected revenues, profits, and cash flows.
You should then include a summary of your key financial figures such as projected revenues, profits, and cash flows.
Lastly, address any funding needs in the "ask" section of your executive summary.
2. The presentation of the company
As you build your palm oil producer business plan, the second section deserves attention as it delves into the structure and ownership, location, and management team of your company.
In the structure and ownership part, you'll provide valuable insights into the legal structure of the business, the identities of the owners, and their respective investments and ownership stakes. This level of transparency is vital, particularly if you're seeking financing, as it clarifies which legal entity will receive the funds and who holds the reins of the business.
Moving to the location part, you'll offer a comprehensive view of the company's premises and articulate why this specific location is strategic for the business, emphasizing factors like catchment area, accessibility, and nearby amenities.
When describing the location of your palm oil producer, you could emphasize its access to key markets and transportation networks. It may be located in a region with abundant resources, such as water, land, and labor, that could enable efficient production. You could also highlight the potential for long-term growth in the area, and explain that the location could provide a secure and stable investment for the financier.
Lastly, you should introduce your esteemed management team. Provide a thorough explanation of each member's role, background, and extensive experience.
It's equally important to highlight any past successes the management team has achieved and underscore the duration they've been working together. This information will instil trust in potential lenders or investors, showcasing the strength and expertise of your leadership team and their ability to deliver the business plan.
3. The products and services section
The products and services section of your palm oil producer business plan should include a detailed description of what your company sells to its customers.
For example, your palm oil producer might offer clients a range of products such as palm oil, palm kernel oil, and fractionated palm oil. These products would be of the highest quality and could be supplied in different formats, including bulk, packaged, or refined. Additionally, customers can benefit from related services such as oilseed processing, storage, and transportation. These services are designed to help customers save time and resources, while ensuring a consistent supply of palm oil.
The reader will want to understand what makes your palm oil producer unique from other businesses in this competitive market.
When drafting this section, you should be precise about the categories of products or services you sell, the clients you are targeting and the channels that you are targeting them through.
4. The market analysis
When outlining your market analysis in the palm oil producer business plan, it's essential to include comprehensive details about customers' demographics and segmentation, target market, competition, barriers to entry, and relevant regulations.
The primary aim of this section is to give the reader an understanding of the market size and appeal while demonstrating your expertise in the industry.
To begin, delve into the demographics and segmentation subsection, providing an overview of the addressable market for your palm oil producer, key marketplace trends, and introducing various customer segments and their preferences in terms of purchasing habits and budgets.
Next, shift your focus to the target market subsection, where you can zoom in on the specific customer segments your palm oil producer targets. Explain how your products and services are tailored to meet the unique needs of these customers.
For example, your target market might include households that prioritize buying organic or locally-sourced food products. They are likely to be willing to pay higher prices for palm oil if they know it is sustainable and ethically-sourced. They also likely have a greater appreciation for the health benefits of using palm oil in their cooking.
In the competition subsection, introduce your main competitors and explain what sets your palm oil producer apart from them.
Finally, round off your market analysis by providing an overview of the main regulations that apply to your palm oil producer.
5. The strategy section
When crafting the strategy section of your business plan for your palm oil producer, it's important to cover several key aspects, including your competitive edge, pricing strategy, sales & marketing plan, milestones, and risks and mitigants.
In the competitive edge subsection, clearly explain what sets your company apart from competitors. This is particularly critical if you're a startup, as you'll be trying to establish your presence in the marketplace among entrenched players.
The pricing strategy subsection should demonstrate how you aim to maintain profitability while offering competitive prices to your customers.
For the sales & marketing plan, outline how you plan to reach and acquire new customers, as well as retain existing ones through loyalty programs or special offers.
In the milestones subsection, detail what your company has achieved thus far and outline your primary objectives for the coming years by including specific dates for expected progress. This ensures everyone involved has clear expectations.
Lastly, in the risks and mitigants subsection, list the main risks that could potentially impact the execution of your plan. Explain the measures you've taken to minimize these risks. This is vital for investors or lenders to feel confident in supporting your venture - try to proactively address any objection they might have.
Your palm oil producer could face the risk of changing market demand, as consumer preferences may shift over time. This could lead to a decrease in the price of palm oil, which could in turn have a negative effect on the business. Additionally, the producer could be exposed to the risk of natural disasters such as floods or droughts, which could damage crops and disrupt production. Such events could potentially lead to financial loss and even impact the long-term sustainability of the business.
6. The operations section
In your business plan, it's also essential to provide a detailed overview of the operations of your palm oil producer.
Start by covering your team, highlighting key roles and your recruitment plan to support the expected growth. Outline the qualifications and experience required for each role and your intended recruitment methods, whether through job boards, referrals, or headhunters.
Next, clearly state your palm oil producer's operating hours, allowing the reader to assess staffing levels adequately. Additionally, mention any plans for varying opening times during peak seasons and how you'll handle customer queries outside normal operating hours.
Then, shift your focus to the key assets and intellectual property (IP) necessary for your business. If you rely on licenses, trademarks, physical structures like equipment or property, or lease agreements, make sure to include them in this section.
You may have key assets such as land used for palm oil production, or physical equipment used in the production process. Additionally, you could have intellectual property such as proprietary knowledge about the production process, or a trademarked brand name associated with your palm oil production. These assets and IP may be essential to the success of your business and should be protected accordingly.
Lastly, include a list of suppliers you plan to work with, detailing their services and main commercial terms, such as price, payment terms, and contract duration. Investors are interested in understanding why you've chosen specific suppliers, which may be due to higher-quality products or established relationships from previous ventures.
7. The presentation of the financial plan
The financial plan section is where we will include the financial forecast we talked about earlier in this guide.
Now that you have a clear idea of the content of a palm oil producer business plan, let's look at some of the tools you can use to create yours.
What tool should I use to write my palm oil producer's business plan?
In this section, we will be reviewing the two main options for writing a palm oil producer business plan efficiently:
- Using specialized software,
- Outsourcing the drafting to the business plan writer.
Using an online business plan software for your palm oil producer's business plan
The modern and most efficient way to write a palm oil producer business plan is to use business plan software .
There are several advantages to using specialized software:
- You can easily create your financial forecast by letting the software take care of the financial calculations for you without errors
- You are guided through the writing process by detailed instructions and examples for each part of the plan
- You can access a library of dozens of complete business plan samples and templates for inspiration
- You get a professional business plan, formatted and ready to be sent to your bank or investors
- You can easily track your actual financial performance against your financial forecast
- You can create scenarios to stress test your forecast's main assumptions
- You can easily update your forecast as time goes by to maintain visibility on future cash flows
- You have a friendly support team on standby to assist you when you are stuck
If you're interested in using this type of solution, you can try The Business Plan Shop for free by signing up here .
Hiring a business plan writer to write your palm oil producer's business plan
Outsourcing your palm oil producer business plan to a business plan writer can also be a viable option.
Business plan writers are experienced in writing business plans and adept at creating financial forecasts without errors. Furthermore, hiring a consultant can save you time and allow you to focus on the day-to-day operations of your business.
However, hiring business plan writers is expensive as you are paying for the software used by the consultant, plus their time, and their profit margin of course.
From experience, you need to budget at least £1.5k ($2.0k) excluding tax for a complete business plan, more if you need to make changes after the initial version (which happens frequently after the initial meetings with lenders or investors).
You also need to be careful when seeking investment. Investors want their money to be used to grow the business, not spent on consulting fees. Therefore, the amount you spend on business plan writing services (and other consulting services such as legal services) needs to be negligible relative to the amount raised.
The other drawback is that you usually don't own the business plan itself: you just get the output, while the actual document is saved in the consultant's business plan software - which makes it difficult to maintain the document up to date without hiring the consultant on a retainer.
For these reasons, outsourcing the palm oil producer business plan to a business plan writer should be considered carefully, weighing both the advantages and disadvantages of hiring outside help.
Ultimately, it may be the right decision for some businesses, while others may find it beneficial to write their business plan using online software.
Why not create your palm oil producer's business plan using Word or Excel?
Using Microsoft Excel and Word (or their Google, Apple, or open-source equivalents) to write a palm oil producer business plan is a terrible idea.
For starters, creating an accurate and error-free financial forecast on Excel (or any spreadsheet) is very technical and requires both a strong grasp of accounting principles and solid skills in financial modelling.
As a result, it is unlikely anyone will trust your numbers unless - like us at The Business Plan Shop - you hold a degree in finance and accounting and have significant financial modelling experience in your past.
The second reason is that it is inefficient. Building forecasts on spreadsheets was the only option in the 1990s and early 2000s, nowadays technology has advanced and software can do it much faster and much more accurately.
And with the rise of AI, software is also becoming smarter at helping us detect mistakes in our forecasts and helping us analyse the numbers to make better decisions.
Also, using software makes it easy to compare actuals vs. forecasts and maintain our forecasts up to date to maintain visibility on future cash flows - as we discussed earlier in this guide - whereas this is a pain to do with a spreadsheet.
That's for the forecast, but what about the written part of my palm oil producer business plan?
This part is less error-prone, but here also software brings tremendous gains in productivity:
- Word processors don't include instructions and examples for each part of your business plan
- Word processors don't update your numbers automatically when they change in your forecast
- Word processors don't handle the formatting for you
Overall, while Word or Excel may be viable options for creating a palm oil producer business plan for some entrepreneurs, it is by far not the best or most efficient solution.
- Having an up-to-date business plan is key to maintaining visibility on your future cash flows.
- A business plan has 2 parts: a financial forecast highlighting the expected growth, profitability and cash generation of the business; and a written part which provides the context needed to interpret and assess the quality of the forecast.
- Using business plan software is the modern way of writing and maintaining business plans.
We hope that this guide helped you to better understand how to write the business plan for a palm oil producer. If you still have questions, do not hesitate to contact us.
Also on The Business Plan Shop
- How to write a 5 years business plan
- Business plan myths
Know someone who owns or wants to start a palm oil producer? Share this article with them!
Founder & CEO at The Business Plan Shop Ltd
Guillaume Le Brouster is a seasoned entrepreneur and financier.
Guillaume has been an entrepreneur for more than a decade and has first-hand experience of starting, running, and growing a successful business.
Prior to being a business owner, Guillaume worked in investment banking and private equity, where he spent most of his time creating complex financial forecasts, writing business plans, and analysing financial statements to make financing and investment decisions.
Guillaume holds a Master's Degree in Finance from ESCP Business School and a Bachelor of Science in Business & Management from Paris Dauphine University.
Published on 11 Sep 2023 , last update on 12 Sep 2023 , as per our editorial standards .
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- Open access
- Published: 11 October 2021
Oil palm in the 2020s and beyond: challenges and solutions
- Denis J. Murphy 1 ,
- Kirstie Goggin 1 , 2 &
- R. Russell M. Paterson 3 , 4
CABI Agriculture and Bioscience volume 2 , Article number: 39 ( 2021 ) Cite this article
Oil palm, Elaeis guineensis , is by far the most important global oil crop, supplying about 40% of all traded vegetable oil. Palm oils are key dietary components consumed daily by over three billion people, mostly in Asia, and also have a wide range of important non-food uses including in cleansing and sanitizing products.
Oil palm is a perennial crop with a > 25-year life cycle and an exceptionally low land footprint compared to annual oilseed crops. Oil palm crops globally produce an annual 81 million tonnes (Mt) of oil from about 19 million hectares (Mha). In contrast, the second and third largest vegetable oil crops, soybean and rapeseed, yield a combined 84 Mt oil but occupy over 163 Mha of increasingly scarce arable land. The oil palm crop system faces many challenges in the 2020s. These include increasing incidence of new and existing pests/diseases and a general lack of climatic resilience, especially relating to elevated temperatures and increasingly erratic rainfall patterns, plus downstream issues relating to supply chains and consumer sentiment. This review surveys the oil palm sector in the 2020s and beyond, its major challenges and options for future progress.
Oil palm crop production faces many future challenges, including emerging threats from climate change and pests and diseases. The inevitability of climate change requires more effective international collaboration for its reduction. New breeding and management approaches are providing the promise of improvements, such as much higher yielding varieties, improved oil profiles, enhanced disease resistance, and greater climatic resilience.
The palms, or Arecaceae, are a family of stem-less, tree-like monocot plants that are highly significant to humans and wider biodiversity, especially in the tropics (Cosiaux et al. 2018 ). The African oil palm, Elaeis guineensis , is native to West Africa and in terms of agriculture, it is perhaps the world’s most important palm species. Oil palm fruits are available year-round and have served as semi-wild food resources in traditional societies for > 7000 years. In its regions of origin the oil palm plant has great significance to local people and for wider biodiversity (Cosiaux et al. 2018 ; Reddy et al. 2019 ; Okolo et al. 2019 ). Cultivation of oil palm as a crop was originally an informal process mainly confined to the West/Central African coastal belt between Guinea/Liberia and Northern Angola (Corley and Tinker 2015 ). Globally, the best production levels are achieved in high rainfall areas in equatorial regions between 7° N and 7° S. During the nineteenth century, oil palm seeds were transported to the Dutch East Indies (modern Indonesia), and to the Malay States (modern Malaysia), as part of colonial ventures to grow newly introduced cash crops in the region. During the twentieth century, more systematic oil palm cultivation on plantations gradually became established in the Malay States. In terms of large-scale commercial production, however, oil palm is a relatively recent crop that only emerged into global prominence later in the twentieth century, with an almost linear rise from 1990 to the early 2000s, followed by a plateau after 2007 (Malaysian Palm Oil Production by Year 2020 ). This was largely due to government initiatives in the 1970s and 80 s aimed at improving the agriculture and economy of the newly independent nation of Malaysia (Corley and Tinker 2015 ; Murphy 2014 ). The later rise of the oil palm industry in Indonesia occurred during the twenty-first century when there was a > 5-fold increase in oil production from 8.3 Mt in 2000 to 43.5 Mt in 2020.
Today, oil palm is crucial to the economies of many countries, especially Indonesia and Malaysia, from which large quantities of its products are exported in the form of oil, meal and other derivatives (Murphy 2019 ). More widely, oil palm is now cultivated in plantations across the humid tropics of Asia, Africa and the Americas, from where its products are exported to global markets. However, despite its increasing cultivation on three widely separated continents, the vast majority of oil palm is still grown in the two adjacent South East (SE) Asian countries of Indonesia and Malaysia (Table 1 ) that generate about 85% of the entire global production (Murphy 2014 , 2015 , 2019 ; Statista 2020 ; Goggin and Murphy 2018 ). The major importing regions, collectively responsible for about 60% of total palm oil imports, are the Indian subcontinent (India, Pakistan, Bangladesh) with about 17 Mt, the EU-27 with 6.5 Mt, and China with 5 Mt (Statisa 2020 ).
There are two contrasting types of oil found in the two principal tissues of palm fruits, namely ‘palm oil’ and ‘palm kernel oil’ (Murphy 2019 ). Palm oil, extracted from the fleshy mesocarp tissue, is a deep orange-red, semi-solid fluid, whilst palm kernel oil is a white-yellow oil that is extracted mainly from the endosperm tissue of the kernel (seed). These two oils have very different fatty acid compositions (Table 2 ), which means they are used for different downstream applications in a range of industrial sectors (Goggin and Murphy 2018 ). In general, the relatively high saturated fat content of palm oil makes it particularly suitable for edible use as a solid vegetable fat (melting point ca. 35 °C). In contrast, palm kernel oil is a less dense product (melting point ca. 24 °C) that is mostly used for non-edible applications (Statisa 2020 ). A major use of palm kernel oil is as the key functional ingredient in many soaps, detergents and cosmetics. E. guineensis plants bear prolific numbers of oil-rich fruit bunches year-round, each containing between 1000–3000 individual fruits (Corley and Tinker 2015 ). Mesocarp-derived palm oil makes up about 89% the total fruit oil with the remaining 11% being derived from the seed or kernel. Because palm oil and palm kernel oil are extracted from fruits by different mechanical processes and have very different downstream uses, they enter separate supply chains immediately after extraction in mills.
In terms of annual production, the global oil palm industry is worth about US$ 60 billion, employing 6 million people directly plus an additional 11 million indirectly (Kadandale et al. 2019 ). Over 81.1 Mt of palm oils were produced globally in 2019–20, of which 72.3 Mt was mesocarp oil (hereafter referred to as ‘palm oil’) while 8.8 Mt was palm kernel oil (Statisa 2020 ). It is estimated that palm oil or palm kernel oil are present as ingredients in at least half of the products found in a typical supermarket. At least three billion people rely directly on palm oil as a regular part of their diet, and it is a staple cooking oil commonly used in African and Asian food preparation. As global populations increase, the demand for palm oil is likely to continue to rise. Estimates from various industry sources predict that between 93 and 156 Mt palm oil might be required by 2050 (Frost and Sullivan 2017 ; Harris et al. 2013 ; Pirker et al. 2016 ). However, these estimates do not consider the effect of climate change on production, which is likely to reduce the ability of the sector to meet these demands (Paterson 2020a , b , 2021a , b ) as discussed later.
In addition to its edible applications, the oil palm crop provides a wide range of non-food products that also include animal feeds. These feeds are derived from the seeds or kernels, which contain a protein-rich meal residue following oil extraction. Palm kernel meal is an often overlooked product of the crop, but is a useful livestock feedstuff that is exported globally. In 2019, about 7.6 Mt palm kernel meal was exported, almost exclusively (98%) from Indonesia and Malaysia (Indexmundi 2021 ). In order of importance, the major importing countries (75% of total 2019 imports) are the EU, New Zealand and Japan, where the meal is used in a variety of feed formulations, especially for ruminants such as cattle.
The image of oil palm has been adversely affected by detrimental environmental consequences of its cultivation, especially with respect to deforestation and haze creation (Paterson and Lima 2018 ). There is also great public concern about the plight of iconic species, and particularly the orangutan, in SE Asia. Some of the particular challenges currently faced by the industry include the following:
Greatly reduced demand for crop-derived biofuels, especially in Europe.
Serious production issues related to plantation management, labour shortages, replanting with improved crop varieties, mechanization etc.
Ongoing environmental and sustainability issues including deforestation, biodiversity loss and GHG emissions due to crop expansion.
Growing threats arising from climate change, including biotic factors, such as pests and disease, that could impact crop performance in unpredictable ways.
Increasingly serious supply chain and consumer issues including potential trade barriers and boycotts.
In all cases these issues will require attention by the industry during the rest of this decade and beyond.
Structure of the oil palm industry
Modern commercial oil palm cultivation began in Malaysia in 1917 (Basiron 2007 ) and over 88% of palm oil is still produced by Malaysia plus the neighbouring countries, Indonesia and Thailand (Statista 2020 ). From 2001 to 2016, the expansion of oil palm plantations was particularly marked in this region with a 2.5-fold increase in Malaysia and a 4.2-fold increase in Indonesia (Xu et al. 2020 ). Over the past decade, oil palm crops have also been grown increasingly outside SE Asia (Murphy 2019 ), as suitable land in Asia becomes scarce and the changing climate is less conducive to cultivation (Paterson 2021a , b ). For example, there is only an estimated 300,000 ha of available land for palm expansion remaining in Malaysia (Villela et al. 2014 ), with increasing government prohibitions for environmental reasons, on further encroachment onto forest and peatland in Indonesia (Jackson 2019 ). Continuing increases in global demand over the past five decades have meant that the cultivation of oil palm has been widely regarded by many tropical countries as a method to boost their economies (Arrieta et al. 2007 ; Ohimain and Izah 2014 ; Paterson et al. 2015 ).
In SE Asia, the primary regions for oil palm production in Indonesia are Sumatra and Kalimantan (Paterson et al. 2015 ; Suryantini and Wilandari 2018 ), while in Malaysia the peninsula was the historical centre, although considerable expansion has occurred more recently in Sabah and Sarawak. Due their climatic suitability, oil palm cultivation has also spread to other SE Asian countries, especially Thailand and Papua New Guinea, with Myanmar and the Philippines in the initial stages of development where the crop is important to the economies of each of these countries (Corley and Tinker 2015 ; Suryantini and Wilandari 2018 ; Pornsuriya et al. 2013 ; Somnuek et al. 2016 ; Woods 2015 ). Due to its profitability, there are also significant emerging oil palm industries in much of tropical Africa with Nigeria, Ghana, Ivory Coast, Cameroon, Sierra Leon, Benin, Angola, and DRC as the main producers (in that order) (Paterson 2021a ). However, in most cases African oil palm crops are mainly used for local consumption, with Cameroon and Ivory Coast as the only major palm oil exporters (Corley and Tinker 2015 ). Nigeria is the fifth highest producer globally, with an annual 1·0 Mt, although this is dwarfed by Indonesia with 42.5 Mt and Malaysia with 18.5 Mt (Statista 2020 ).
In the Americas, the first oil palm plantations were established in Honduras and Costa Rica and currently the largest industries are in Colombia and Ecuador, although Brazil is also expanding its production (Corley and Tinker 2015 ; Murphy 2019 ; Nahum et al. 2020 ). South and Central America are considered as favourable areas for oil palm development due to their theoretical ability to produce palm oil. There is well over 1.5 Mha of planted oil palm in Latin America with Brazil having the largest future potential, although currently the leading producer is Colombia with an annual 1.5 Mt. Although the environmental consequences of increasing oil palm cultivation require careful consideration (Murphy 2015 ; Paterson 2020a , b , 2021a ), these countries could potentially increase their market share in a sustainable manner, for example by only converting land currently used for pasture or illegal coca cultivation. This will be important as land in Malaysia and Indonesia becomes less available (Paterson and Lima 2018 ). However, there are also important climate change constraints for a truly sustainable future industry in the Americas, Africa, and SE Asia (Paterson 2021a , b , c , d ; Indexmundi 2021 ; Paterson et al. 2015 , 2017 ).
A recent study shows the global distribution of smallholder and industrial plantations at high resolution (Descals et al. 2020 ). Smallholders account for 30 to 40% of global land palm oil cultivation (Hambloch 2018 ; Euler et al. 2016 ). In SE Asia there are more than three million smallholders, nearly all of whom cultivate individual family-owned and managed plots of less than 50 ha and often as little as 1–2 ha. In Indonesia, which is the largest oil palm producing country, smallholder plots account for 40% of the total crop area, although they only produce 30% of total national output (Euler et al. 2017 ). However, although the larger commercial plantations tend to be more efficient in terms of oil yield and overall economics, smallholder units serve important social roles in providing income and employment to rural populations (Murphy 2015 ; Euler et al. 2016 ). Smallholder units are also more likely to supply palm oil for local consumption rather than for export. This is particularly true for parts of Indonesia and Africa where the crops can be regarded as key elements in local food security and economic wellbeing (Krishna et al. 2017 ; Kubitza et al. 2018 ). Interestingly, there is also evidence that smallholdings can have lower environmental impacts (Lee et al. 2014 ) and higher biodiversity levels than commercial plantations (Razak et al. 2020 ).
In contrast, commercial plantations tend to be part of large ventures that are often owned by multinational companies that can extend over tens of thousands of hectares, with the largest totalling about one million ha. In terms of global trade, palm oils from commercial plantations are by far the most important contributors. In some cases, the larger plantation companies also own or control many key downstream elements in palm oil supply chains. These include mills, refineries, shipping operations and the distribution networks to processors and retailers in export destinations.
In summary, oil palm cultivation is still highly concentrated in SE Asia, but the focus of future expansion is likely to be elsewhere in the humid tropics, especially in West Africa and northern regions of South America. Therefore, the oil palm industry is a hybrid of large scale, globally focussed, commercial farming and small scale production of a cash crop, often for local consumption. As discussed below, the industry must manage the effects of environmental factors, such as climate change and increased disease incidence on cropping systems, as well as changing consumer sentiments in export destinations.
The environmental context
Oil palm is widely considered as a problematic crop. This has been mainly due to the environmental and ecological impacts of some of the land conversions to oil palm plantations over the past two decades, especially in Indonesia. In many cases these have displaced pristine tropical habitats and affected iconic wildlife species, such as orangutan (May-Tobin et al. 2012 ; Gaveau et al. 2014 ). The EU is the second largest global importer of palm-based oils and this consumer-led demand has been one of the drivers of the expansion of recent oil palm cultivation. Since 2000, increased global demand for biofuels and other non-food products (mainly from Europe), and for food (mainly from India and China), were the major factors behind the conversion of land in SE Asia to oil palm cultivation. In Indonesia the area of oil palm cultivation more than trebled from 2.5 Mha to over 8 Mha between 2000 and 2014 (Indonesia: Palm oil expansion unaffected by Forest Moratorium 2013 ). In some cases this has led to significant habitat loss and reductions in biodiversity as complex ecosystems are replaced with simpler species-poor plantation systems, as well as concerns about increased GHG emissions as land is converted to oil palm (Dislich et al. 2017 ; Meijaard et al. 2020 ; Carlson et al. 2012 ; Barcelos et al. 2015 ).
Several studies have examined the potential impact of land use and climate change on biodiversity in Borneo, where a great deal of oil palm planting has occurred during the past decade (Scriven et al. 2015 ; Gaveau et al. 2016 ). Recommendations from these and other studies, include the need to establish nature reserves in upland areas where climate change will be less severe and also to improve connections between reserves and plantations via wildlife corridors (Scriven et al. 2019 ). One of the most controversial aspects of new palm cultivation in SE Asia is the use of tropical peatland, especially in Borneo. There are several ongoing studies of the impact of peatland conversion in terms of GHG emissions, and other environmental studies have been carried out in association with the major certification scheme that is run by the Roundtable on Sustainable Palm Oil (RSPO). Examples include the following articles: (Gunarso et al. 2013 ; Chase et al. 2012 ; Dalal and Shanmugam 2015 ; Tonks et al. 2017 ; Cook 2018 ).
As a result of such studies, RSPO insist that to gain certification, new plantings since November 2005, must not have replaced primary forest or any area required to maintain or enhance one or more High Conservation Values (HCV). An HCV assessment, including stakeholder consultation, must be conducted prior to any conversions and dates of land preparation and commencement must also be recorded. The HCV assessment process requires appropriate training and expertise, and must include consultation with local communities, particularly for identifying social HCVs. Development should actively seek to utilize previously cleared and/or degraded land. Plantation development should not put indirect pressure on forests through the use of all available agricultural land in an area. In order to improve the participation of smallholders, local certification schemes, such as the Malaysian Sustainable Palm Oil (MSPO) and Indonesian Sustainable Palm Oil (ISPO) initiatives, have been set up, although internationally traded palm oils are almost exclusively certified by RSPO.
Several studies suggest that limited oil palm expansion might be possible on already degraded land, without the need to convert mature tropical forests (Jackson 2019 ; Wicke et al. 2011 ), and that smallholdings may have lower environmental impacts than commercial plantations (Lee et al. 2014 ). Despite these caveats, there is considerable pressure for governments to impose much stricter controls, and even outright bans, on the conversion of tropical peatlands and non-degraded forest to oil palm. Although there have been encouraging statements along these lines from politicians in the two major producing countries, these remain largely aspirational at present and more effective action is required.
Pests and diseases
Oil palm crops are affected by several economically important pests and fungal pathogens, of which several of the most serious diseases will now be considered (Corley and Tinker 2015 ).
Basal Stem Rot (BSR) is caused by the fungus, Ganoderma boninense (Fig. 1 ), is a serious disease of oil palm, which can reduce yields by 50–80%. It has increased over recent decades due to its spread from infection foci at a greater rate, following repeated cycles of crop planting on infested sites. In Malaysia, BSR is often reported in young plants and seedlings, whereas previously only mature oil palms were infected (Paterson 2019a , 2020c ). By the time an oil palm stand is halfway through its ca. 25-year economic lifespan, BSR can kill 80% of plants. Furthermore, expansion of industrial oil palm cultivation began early in Sumatra, where G. boninense adaptation to the environment is most likely to occur. This region contains the highest levels of disease, implying an association between the duration of oil palm cultivation and higher disease concentrations. BSR is found increasingly in inland peninsular Malaysia and Sabah, and in some cases is at high levels in places where it has not previously been detected. BSR was also reported at high levels in oil palm grown on inland lateritic soils and peat soils, irrespective of cropping history, whereas before such soils had been disease-free. By the time of replanting (every 25 years), 40–50% of palms were lost in some fields, with the majority of standing palms showing disease symptoms. This information indicates a trend for increasing BSR with projected climate change. However, the climate for growing oil palm is currently optimal and has been so for many decades. The increase in disease previously reported was from increased virulence of the fungus, rather than increased susceptibility of oil palm due to a less suitable climate.
Ganoderma boninense basidiomata on oil palm stems. Images are from the authors’ personal collections (RRMP & DM)
BSR may increase further by natural selection of more virulent strains and oil palm cannot always adapt rapidly enough to respond to changes in pathogen virulence. The BSR pathogen has the ability to infect oil palm plants at a rate of as much as 80% incidence over half of its economic life span (Corley and Tinker 2015 ). Ganoderma is a variable genus with poorly defined species concepts and will adapt to climate change more readily than oil palm via natural selection of more virulent strains (Mercière et al. 2017 ). In Indonesia, BSR is less severe in Kalimantan than in Sumatra, probably due to younger crop rotations (Suryantini and Wilandari 2018 ; Paterson 2019a , b , 2020d ). In Thailand, national BSR incidence is relatively low with a reported rate of 1.53%, although it is more widespread in the south (Basal stem rot of oil palm 2020 ). In Southern Thailand, BSR incidence may be influenced by proximity to peninsular Malaysia where disease rates are also high (Pornsuriya et al. 2013 ). In Papua New Guinea, BSR incidence is not as high as in other areas of SE Asia, although rates of 50% have been recorded in some regions. An average of 25% infection is a plausible scenario for this country as the initial incidence is lower than in Malaysia and Indonesia. BSR incidence is probably low in Myanmar as the plantations are more recent and distances between them are large. Myanmar has a distinctly different climate to the rest of SE Asia and is less capable of growing oil palm per se (Paterson 2020b ).
Paterson ( 2020c , d ) considered BSR in Malaysia and Indonesia respectively and in the regions of the countries. Disease incidence was much higher in peninsular Malaysia than in Sarawak, and especially Sabah. Sabah may therefore be a more sustainable region from the perspective of BSR incidence. In Indonesia, Sumatra and Java had particularly high incidences compared to other areas such as Sulawesi and Papua. These scenarios indicated which regions may be suitable in terms of future sustainability of the industry. However, the environmental effects, especially from deforestation, should be of prime importance in planning new plantations.
Fusarium oxysporum f.sp. elaeidis (Foe) results in acute and chronic wilt of oil palm particularly in Africa (Paterson 2021e ). A major outbreak devastated OP in West and Central Africa where it has a particularly high incidence (Rusli 2017 ). Foe in Malaysia and Indonesia is controlled by quarantine procedures, although native strains can infect oil palm in vitro. Avoiding introduction from endemic areas is essential to prevent Foe in regions where it is does not normally exist. However, importation of breeding materials from Africa is required to expand genetic diversity in Malaysia and Indonesia, implying a risk from infested seed and pollen. Quarantine procedures in Malaysia and Indonesia are undertaken, although the risk of spread remains, especially because climate change may increase disease (Rusli et al. 2015 ).
In the Ivory Coast, 20% of palms planted from 1964 to 1967 displayed vascular wilt symptoms, with some crosses at 70% (Cochard et al. 2005 ). But from 1976 to 1983 vascular wilt rates of < 2% were observed and in the 1990s, it was difficult to find symptoms in plantations. These reductions were attributed to breeding for resistance. Rusli et al. ( 2015 ) found that Foe infection of oil palm was frequent in Ghana with incidences of 10.4% and 8.3% and also detected the presence of Foe in ca. 11% of symptomless palms in plantations. Decades of selection and breeding for wilt resistance occurred in Ivory Coast where 20% of palms planted from 1964 to 1967 displayed vascular wilt symptoms, with some crosses at 70% (Cochard et al. 2005 ). Rusli ( 2017 ) demonstrated that Malaysian oil palms were susceptible to infection by Foe strains from Africa.
Phytophthora palmivora is a fungus-like oomycete and a notorious pathogen of oil palm, causing severe damage in Latin American countries, such as Colombia (Corley and Tinker 2015 ). The disease has recently devastated > 30,000 ha in South West Colombia and > 10,000 ha in the Central Zone, and the rapid increase in the disease may be related to climate change. Acute and chronic forms are found, and it is possible that several different diseases have been described under one name. The acute forms are present in Colombia and Ecuador, with the chronic forms found in Brazil (Corley and Tinker 2015 ). P. palmivora disease of oil palm is unreported in Malaysia and/or Indonesia, although a similar spear rot of oil palm has been reported in Africa and Thailand, which may involve P. palmivora . Many other hosts for the oomycete exist in Malaysia and Indonesia (e.g. durian) and, in view of a recent extreme outbreak in Colombia, P. palmivora presents a potentially severe threat to Malaysian and Indonesian plantations (Paterson 2020a ). More assessments of infectivity are essential given that outbreaks of P. palmivora could cause severe problems for major SE Asian oil palm industries.
Other fungi Several lesser fungal diseases also cause problems for oil palm (Corley and Tinker 2015 ). Bunch failure is used to describe oil palm fruit bunches that fail to develop from anthesis to harvest, and the disease can be caused by the basidiomycete Marasmius palmivorus. Another basidiomycete, G. philippii , is closely related to G. boninense but is in fact a trunk rot of Acacia trees that is also listed as an oil palm pathogen (Corley and Tinker 2015 ). This species may become more frequently isolated from oil palm due to climate change. Phellinus noxius is a basidiomycete, partially responsible for upper stem rot of oil palm, occurring together with G. boninense in some cases. Haematonectria haematococca has been implicated in spear rot of oil palm in vitro. Dry basal rot of oil palm is caused by the ascomycete Ceratocystis paradoxa (anamorph = Thielaviopsis paradoxa ), which also has been implicated in oil palm fatal yellowing in, for example, Colombia. Cercospora ealidis is widespread throughout Africa and causes Cercospora leaf spot. It is infrequent in Asia and is primarily a disease of nursery seedlings and frequently carried forward to plantations where it can survive for a long time (Corley and Tinker 2015 ). Glomerella cingulata is responsible for anthracnose disease in oil palm, although it is not severe currently. All these are diseases of oil palm and it is important to assess how they will be affected by climate change in future studies.
In general, pest species of oil palm do not have as much impact on the crop as diseases, with the possible exception of the rhinoceros beetle, Oryctes rhinoceros , which emerged as the major pest of oil palm in SE Asia in the 1980s. Although chemical insecticides can be effective, they are expensive, they can affect beneficial insects, and the target organisms may develop resistance. This has led to development of biocontrol strategies, the most effective of which are the deployment of two pathogens of the beetle, namely the entomophagous fungus Metarhizium anisopliae and the Oryctes virus (Ramle et al. 2005 ). Both pathogens are specific to rhinoceros beetles and as such will not affect other insects. The Oryctes virus appears to be endemic in the beetle population, and deliberate augmentation can increase infection levels to > 75%. Metarhizium fungal spores can be applied to areas of infestation as a spray that is highly effective at controlling, but not totally eradicating, the beetles. The combined use of these and other natural pathogens of the rhinoceros beetle have the potential to reduce its harmful impact on the crop, while also minimizing risks of resistance development.
With the projected increase in oil palm replanting over the coming years, it will be important to consider the wider release of such biocontrol agents into areas where rhinoceros beetle incidence is particularly high. These and other forms of integrated pest management are being investigated as primary options in plantations across SE Asia (Ramle et al. 2005 ; Kalidas 2013 ). The rapid expansion of high intensity commercial plantations in new regions such as West Africa and South/Central America, plus climatic changes, are likely to result in the emergence of new pests and pathogens. Therefore, it will be important for the public sector and industry to work together in developing improved methods of surveillance and early detection of such threats (Kalidas 2013 ; Caudwell and Orrell 1997 ).
Impacts of climate change
The negative impacts and significance of climate change are well documented in the scientific literature and are now broadly accepted by most of the general public. Climate change threatens the sustainability of crop production via factors such as temperature, rainfall and disease patterns (Rosenzweig et al. 2008 ). However, the likely effects on tropical crops remain less well known, especially in SE Asia, Africa and Latin America (Ghini et al. 2011 ; Feeley et al. 2017 ; Sarkar et al. 2020 ), although recent research has started to address the situation for oil palm (Paterson 2019a , b , 2020b , c , 2021a , b ; Paterson and Lima 2018 ; Paterson et al. 2015 , 2017 ; Sarkar et al. 2020 ; Shabani et al. 2012 ), as discussed below. Climate change effects on natural systems require prediction to mitigate consequential changes in diversity and ecosystem function (Feeley et al. 2017 ). Mapping of plant disease distributions can influence biosecurity planning, specifying areas that qualify for eradication or containment. The CLIMEX model has been developed for current and future species distribution where knowledge about climate change effects on species distributions is essential in mitigating negative impacts (Lenoir and Svenning 2015 ).
Effects of oil palm cultivation on climate change
Koh and Wilcove suggested that oil palm expansion occurs at the expense of forests acting as carbon sinks (Koh and Wilcove 2008 ). Dislich et al. ( 2017 ) determined 11 of 14 ecosystem functions decreased in levels of function by the introduction of oil palm plantations. Fitzherbert et al. ( 2008 ) determined that oil palm plantations support many fewer species than forests and some other tree crops: Habitat fragmentation and increased pollution can further increase GHG emissions. The detrimental aspects of increasing numbers of oil palm plantations has been discussed in terms of deforestation and haze production from burning peat soil to clear ground for new plantations (Tonks et al. 2017 ; Cook 2018 ; Veloo et al. 2015 ). These processes release GHGs contributing to climate change (Dislich et al. 2017 ).
The conversion of tropical rainforests into oil palm plantations is the primary environmental impact of the industry (Paterson and Lima 2018 ). Forested areas are used for the expansion of plantations where the emissions from conversion exceeded the potential carbon fixing of oil palm (Paterson et al. 2015 , 2017 ). Oil palm production involving deforestation re-leases global anthropogenic emissions of 6–17% CO 2 (Wich et al. 2012 ). The highest carbon emitter countries from forest cover loss are Brazil, Indonesia and Malaysia with values of 340, 105, and 41 [Teragrams (Tg) C/year] respectively. Indonesia and Malaysia account for high C emissions from deforestation as they are the first and second highest producers of oil palm. Substantial palm oil production is also undertaken in Columbia and Nigeria (Paterson et al. 2017 ). Emissions from oil palm cultivation in Indonesia accounted for ca. 2–9% of all tropical land use emissions from 2000 to 2010 (Carlson et al. 2018 ) and deforestation accounted for about 30% of global warming-related pollution emissions in 2009, with Indonesia as the world’s seventh-largest producer of such emissions. Plantation expansion in Kalimantan, Indonesia contributed 18–22% of the country’s CO 2 emissions in 2020.
Large reductions in emitted GHGs and climate regulation function occur due to conversion of forest to oil palm plantations (Dislich et al. 2017 ). More GHGs and volatile organic compounds (VOCs), which are precursors to tropospheric ozone, are produced by oil palm plantations. GHGs emitted from land-clearing fires and land and plantation establishment are significantly greater than carbon sequestered by oil palm. VOCs, GHGs and aerosol particle emissions during fire periods result in direct and indirect changes of solar irradiation while undisturbed forests give lower air and soil temperature and higher air humidity microclimates compared to plantations (Dislich et al. 2017 ).
Indonesia has increased oil palm plantations, reducing drastically the primary forest. Sumatra has the highest primary rainforest cover loss in the country. Forest cover in Riau and Jambi declined from 93 to 38% between 1977 and 2009 changing microclimatic conditions from lack of natural forests regulation. Warming of land surface and increases in air temperature from climate change occur from oil palm expansion as observed in Sumatra (Paterson and Lima 2018 ). Oil palm foliage cover is lower, more open, and simpler than tropical rainforest foliage cover. Warming occurs from reduced evaporative cooling and warming induced by land cover change (LCC) exceeded the global warming effect.
The predominant compound contributing to the GHG from oil palm plantations is CO 2 whereas nitrous oxide and methane are at reduced concentrations, although with greater effect per molecule. Large releases of CO 2 from land-clearing fires occur, particularly on peat. Also, fires indirectly increase emissions by increasing peat decomposition. Drainage of peat soil releases large concentrations of CO 2 to establish plantations by oxidation and decomposition: dissolved organic matter is removed from peat soils during drainage, which decomposes and releases additional CO 2 .
The very high fruit production of oil palm allows greater assimilation of CO 2 and produces more biomass than forests and is often used erroneously as an argument in favour of oil palm. This higher rate of C uptake does not compensate for that released when forests are cleared, as forests have more biomass than oil palm plantations unless very long timescales of hundreds of years are considered, well beyond the maximum time frame of ca. 80 years considered in Paterson et al. ( 2015 , 2017 ) in terms of the likely effect of climate change on suitable climate for oil palm growth for example.
Fires also add black carbon (soot), which increase global warming and oil palm plantations release more N 2 O into the atmosphere than forests, mainly from fertilizer use. Peatland deforestation for oil palm cultivation in West Kalimantan, Indonesia, increased GHG emissions greatly (Paterson and Lima 2018 ). Overall, the biological and managerial tools to surmount many challenges exist but need much better support (Murphy 2014 ) and will be discussed below. In addition, large scale conversion of tropical forest to oil palm plantations has detrimental effects on biodiversity.
Effects of climate change on oil palm cultivation
In terms of general effects, climate change is likely to affect sustainable production of palm oil as climatic suitability will decrease, with concomitant increases in economic and social problems in producing regions. Poleward movements in climate-related ranges of particular plants are by far the most frequently reported, including limited reports on poleward change in suitable climates for oil palm growth (Paterson et al. 2017 ; Fei et al. 2017 ). How species may react under climate change has been reported including the detrimental effect on the suitability of future climates on oil palm growth in a global setting (Paterson et al. 2017 ). Furthermore, oil palm production creates climate change as discussed above and this will affect detrimentally the ability to grow oil palms and alter their distribution (Paterson and Lima 2018 ). Oil palm is currently grown in optimal climatic conditions and has been for many decades (Corley and Tinker 2015 ).
Suitable oil palm climatic impact data have been used to create schemes for its mortality by postulating that large degrees of unsuitable and marginal climates in particular were likely to cause high amounts of mortality. Also, reductions in highly suitable and/or suitable climate per se would not cause a significant effect on oil palm mortality. Simulation modelling to determine suitable climate scenarios for growing oil palm (Paterson et al. 2017 ; Paterson 2019a ), were employed to estimate how climate suitability for oil palm growth would change the estimated mortality rate from unsuitable climatic conditions. Predicted percentage oil palm mortality was determined in (a) SE Asia (Paterson 2020b ) and (b) Latin America and extrapolated to Malaysia and Indonesia (Paterson 2020c ) (Fig. 2 a, b). These percentages represent large numbers of oil palms in Malaysia, Indonesia, Thailand and Papua New Guinea because of the large numbers grown in these countries. Information on oil palm mortality is also provided for some African countries in Paterson ( 2021e ).
(Adapted from data provided in Paterson ( 2021b )
a Oil palm mortality in Ecuador, Colombia and Brazil. b Oil palm mortality in Malaysia and Indonesia. These data take into account projected future changes in suitable climate for growing oil palm.
The detrimental effect of future climate changes on oil palm cultivation globally and on oil palm mortality in Kalimantan, Indonesia and some other SE Asian countries were determined (Paterson 2020b , c ; Paterson et al. 2017 ), which provided information relevant to Malaysia (see Table 3 ). High oil palm mortalities were predicted for Thailand, and Myanmar and low mortalities for Kalimantan and the Philippines, while Papua New Guinea was intermediate (Harris et al. 2013 ; Gunarso et al. 2013 ). Modelling of oil palm mortality for three South American countries, Malaysia and Indonesia was performed (Paterson 2020c ) using similar methods to Paterson ( 2020b ). The Latin American countries, particularly Brazil, were assessed to have high future mortalities, whereas the figures for Malaysia and Indonesia were much lower. These potential effects on mortalities will have detrimental consequences on future abilities to meet the demand for palm oil. High levels of mortality were determined for Peninsular Malaysia but not in Sabah or Sarawak in the future from unsuitable climate (Paterson 2020c ). In Indonesia, regions such as Sulawesi and Papua had low levels of mortality in contrast to Sumatra and Java where high mortality was determined (Paterson 2020d ). A study of predicted oil palm mortalities in South America found that by 2050, low mortalities are predicted in (a) the East Coast from Brazil to Suriname, (b) more centrally in Paraguay and (c) Colombia, Peru and Ecuador in the west. High mortalities were determined for Guyana, Bolivia, Western Brazil and Venezuela (Paterson 2021a ). By 2100, much higher mortalities were determined for all countries except Paraguay, which appeared virtually immune to the effects of future climate. Very high mortality of oil palm was determined for Ghana and Nigeria in Africa, especially by 2100 (Paterson 2021e ), whereas Cameroon had low levels,
African oil palms are likely more badly affected by climate change from increased GHGs, although there appears a low extinction risk in the immediate future. Furthermore, losses of oil palm habitats such as tropical rain forests are exacerbating the pressures on oil palm populations: their ecosystem functions and services will be highly sensitive to climate change. Blach-Overgaard et al. ( 2015 ) predicted climate suitability losses across almost all regions where palms occur in Africa and CLIMEX modelling indicated that Africa will have less suitable climatic conditions for oil palm cultivation (Paterson et al. 2017 ). However, sharp longitudinal trends to potential refuges from west to east Africa were found, which could allow oil palm to survive naturally, or by the creation of new plantations towards to east of the continent, with, of course, environmental concerns being paramount (Paterson 2021a ). Using similar methods, a phased increase in suitable climate was predicted, which implied more unsuitable climate for growing oil palm towards the centre of the South American continent (Paterson 2021b ). Increasing longitudinal trends in suitable climate for growing oil palm SE Asia were observed from current time to 2050 and 2100 from west to east (Paterson 2021c ). Paterson ( 2021d ) developed an improved model for determining suitable climate for growing oil palm in Africa which confirmed the west to east trend and could be employed in other regions such as South America and SE Asia.
A significant negative relationship was found between annual average temperature and sea level rise and oil palm production in Malaysia temperature with rises of 1 to 4 °C potentially causing oil palm production to decrease by 10 to 41% (Sarkar et al. 2020 ). Future changes to suitable climates for growing oil palm worldwide were considered using modelling based on temperature, soil moisture and wet stress data (Paterson et al. 2017 ). The general predictions were for a reduced level of suitable climatic regions by 2050 and further reductions by 2100. The projections indicate serious consequences to the oil palm industry generally. In Africa, the climate is predicted to be less suitable for growing oil palm at the same rate, or faster than, Malaysia and Indonesia with the exception of Uganda where increases in climatic suitability were predicted. Paraguay appears to gain suitability in climate for growing oil palm in South America, whereas Venezuela will have a particularly low level of suitable climate. French Guiana, Surname and Guyana appear to maintain suitable climates and large losses were determined in west Brazil by 2100. The western countries of Colombia, Peru and Ecuador will suffer severe losses of suitable climate. Furthermore, there was a three-phase trend in suitable climate rather than a single direct longitudinal change (Paterson 2021b ). Vietnam, the Philippines, Papua New Guinea (PNG) and island Malaysia had increased suitable climate by 2050 in SE Asia. Large decreases in suitable climate by 2050 for Thailand, Laos and Cambodia, which are towards the west of SE Asia, were observed (Paterson 2021c ).
Climate has an important role in defining the range limits of oil palm distribution by exerting eco-physiological constraints (Paterson et al. 2017 ). However, factors such as soil properties and biotic interactions may prevent plants from colonizing sites that are otherwise suitable. Studies such as Paterson et al. (Razak et al. 2020 ) are unusual in that a wider range of climatic conditions are considered than only temperature (Paterson 2021a ). Changes in climate will have broad-scale impacts on the distribution of oil palm. Alterations in cold, heat and dry stresses were largely responsible for the changes in climatic suitability for oil palm cultivation, while wet stress was unimportant, hence extending the range of parameters from temperature alone (Paterson et al. 2017 ). Apart from temperature (Feeley et al. 2017 ) and diseases, a wide range of factors still awaits consideration, although studies on effects on crop production have been reported (Lobell et al. 2006 ).
One of the most important future threats is the emergence of new pests and diseases and/or the movement of existing diseases from one part of the world to another. The transfer of existing biotic threats could occur due to climatic factors, but another mechanism is movement via trade, travel or other human agency where potential pathogens might elude current biosecurity measures. For example, the serious impact of P. palmivora on plantations in S. America, and if this pathogen were to reach the central growing regions of SE Asia, its impact could be devastating (Paterson 2020a ; Mohamed Azni et al. 2019 ). Although biosecurity measures are already in place, these tend to be focussed on known threats and may not be able to cover all of the many potential entry routes for a new pathogen. A similar situation exists for Fusarium wilt disease of oil palm (Paterson 2021e ) with African countries suffering most from this particular disease.
An example of an unexpected new form of pathogen of oil palm is the orange-spotting coconut cadang-cadang viroid variant (OSCCC-Vd) (Coconut cadang-cadang viroid (cadang cadang disease) 2020 ). Viroids were only discovered in the 1970s and are the smallest and simplest known type of infectious pathogen, consisting of just one small, naked, circular single-strand of RNA that does not encode any proteins. The origin of viroids is unknown with some suggestions that they might date from an ancient non-cellular ‘RNA world’, although a more parsimonious hypothesis is that they have arisen de novo on multiple occasions as plant-specific pathogens (Catalán et al. 2019 ). OSCCC-Vd normally infects coconut plantations and is endemic in the Philippines, but early in 2011 a putative variant was found in oil palm plantations in Sabah, triggering a ban on the movement of oil palm materials to other parts of Malaysia. Although the threat of OSCCC-Vd eventually receded in the 2010s, this episode exposed problems in the surveillance mechanisms and phytosanitary procedures in the face of the sudden appearance of a hitherto unknown pathogen.
The effects of climate change on oil palm diseases by fungi and by the oomycete P. palmivora have been discussed and indicate a trend for increased BSR, Fusarium wilt and P. palmivora incidence with climate change. Modelling of the effect of changes in climate on the infection levels of BSR in Sumatra, Indonesia, including quantitative BSR data, indicated that BSR would become even more serious after 2050 (Paterson 2019b ). Weather is a major factor in crop pathogenesis and, when crops suffer cold, heat or desiccation stress, they may be more susceptible. Mountain areas were considered in this assessment which affected some results considerably. For example, hilly regions in North Sumatra did not provide a suitable climate for oil palm.
A similar ‘Agriculture 4.0’ methodology of big data and simulation modelling was used to produce a scheme of how BSR might advance under future climates in Malaysia (Paterson 2019b ). The assessments of BSR were merely qualitative and indicated, nevertheless, that the levels of infection would also increase a great deal after 2050. Paterson ( 2020b ) considered future climate effects on BSR in Kalimantan and alternative countries in SE Asia. Kalimantan and the Philippines were assessed as sustainable, but Thailand and Myanmar were unsustainable, while Papua New Guinea was intermediate in sustainability (Fig. 3 ). P. palmivora is prevalent in South America and Paterson ( 2020c ) extended the principles described above to the disease. Colombia and Ecuador were highly susceptible, while Brazil was less so. However, a severe threat to Malaysia and Indonesia was assessed, which would require increased future vigilance to control the disease. Paterson ( 2021e ) indicated an equivalent situation for Fusarium wilt of oil palm focusing on African countries extrapolated to Malaysia and Indonesia.
Basal stem rot in three S E Asian countries. The incidence of disease was determined from the changes in suitable climate for growing oil palm as described in Paterson ( 2020b )
Amelioration of climate change effects on oil palm and vice versa
Procedures for amelioration of the effects of climate change on oil palm and the effect of oil palm on climate change, have been discussed as partially based on CLIMEX models (Paterson and Lima 2018 ). The situation with the oil palm industry cannot be business as usual in light of the effects of climate change on oil palm and vice versa. A series of procedures have been devised to address how the industry might mitigate these problems (Paterson and Lima 2018 ). Many of these measures will help to maintain the biodiversity normally associated with forests because they will stop the plantation being a monoculture. Also, the soil microfauna will likely increase as a result of these measures.
Reducing the effects of oil palm on climate change
Plantation management measures can prevent or reduce losses of some ecosystem functions which will reduce climate change. These include (a) avoiding illegal land clearing by fire, (b) avoiding draining of peat, and (c) using cover crops, mulch, and compost (Dislich et al. 2017 ). Reducing GHG by limiting oil palm expansion to areas with moderate or low carbon stocks is most effective. This involves ceasing development of plantations on peatland and enforcing the moratorium on new concessions in primary forests. In addition, rehabilitation and restoration of converted peatlands are an option. Limiting the problems of flooding may prevent increased CH 4 emissions on mineral soils. Reducing unnecessary expansion of plantations and ensuring existing ones are managed optimally are crucial. Mechanisms such as (a) reduced emissions from deforestation and forest degradation, plus conservation, sustainable management of forests, and enhancement of forest carbon stocks (REDD+), (b) national greenhouse gas accounting, and (c) accurate emission factors for C dynamics are essential (Comeau et al. 2016 ). Considerable funding has been obtained for REDD + scheme. REDD + proposals include growing oil palm on reclaimed soil and replacing the use of fertilizer with other methods. A few plantations are replacing grassland or scrub where the average C content of the plantation will exceed that of the previous vegetation and so becoming a greater C sink.
Controlling disease may assist in decreasing the unwanted expansion of plantations as yields will be increased from reduced disease in current plantations, such as described for Ganoderma rots of oil palm (see below). The current awareness of environmental issues makes optimizing current plantations by reducing disease imperative in any case. Reducing nitrogen fertilizer is an effective way to decrease nitrogen-based emissions (Dislich et al. 2017 ). Oil palm plantations release large quantities of nitrous oxide (N 2 O) into the atmosphere linked to nitrogen (N) fertilizer use. An option for oil palm planting, without threatening tropical rain forests, is the rehabilitation of anthropogenic grassland that was created by human clearance of natural forest many centuries ago. For example, there are extensive areas of anthropogenic grassland in Indonesia where much of the spread of oil palm plantations will take place (Paterson and Lima 2018 ).
Reducing effects of climate change on oil palm
Evidence is growing of the existing and likely future impacts of anthropogenic climatic changes on the oil palm industry. Immediate priorities should include further research to understand climatic effects on oil palm in the many regions of the tropics where the crop is now grown, and to begin the implementation of mitigation strategies to minimize adverse effects. Most climatic threats identified to date involve periods of elevated temperature and reduced rainfall, both of which cause stresses that impact on overall crop performance, and in particular oil yield. Increasingly well documented impacts of climatic cycles such as El Niño and La Niña have underlined the crucial role of climate for oil palm performance and oil yield (Rahutomo 2016 ; USDA 2016 ).
Strategies are required to minimize the adverse effects of climate change on oil palm cultivation: it cannot be business as usual for the industry. These practices may also decrease climate change from reduced deforestation if the yields of existing oil palm are optimized to cope with climate change. More dispersed cultivation outside the main producing countries could ameliorate threats from climate change as a wider range of climates would be encountered, some of which may be more suitable for oil palm. Current expansion into West Africa and South/Central America already underway was intended to create a more secure production system in the longer term. However, Latin America and Africa may be even more affected by climate change in terms of suitable climate for growing oil palm than SE Asia, implying that expansion will be unlikely. Even within these continents there are trends which will be useful for plantation managers (Paterson 2021a , b ).
Cultivation at higher altitudes and/or lower and higher latitudes may be possible beyond the lowland tropics as climate change progresses. An increase in highly suitable climate for growing oil palm by 2030 in Indonesia and Malaysia largely in mountainous regions of Sumatra, Sarawak, Borneo, and Sulawesi was reported (Paterson et al. 2015 ). There may be novel areas for oil palm development even under climate change, although in general, the climate suitability per se will be reduced. A caveat being potential biodiversity and ecological function loss if novel areas are converted from, for example, forest. The use of cover crops to reduce climate effects on oil palm may be possible and increases biodiversity. The sustainability of oil palm production will depend in part on using cover crops, especially under suboptimal conditions. Leguminous cover crops are grown to (a) coexist with oil palm following jungle clearing and planting/replanting, (b) provide complete cover to an otherwise bare soil, and (c) protect from erosion. They also perform multiple functions such as reducing soil water evaporation, reducing runoff losses, improving and maintaining soil fertility, and recycling of nutrients (Samedani et al. 2015 ). They promise reduced environmental pollution and improved crop yields. Legumes may reduce C and N losses from oil palm systems and increase soil C sequestration. Some examples for oil palm are as follows: Pigeon pea ( Cajanus cajan ), Calopo ( Calopogonium mucunoides Desv.), butterfly pea ( Clitoria ternatea ), white tephrosia ( Tephrosia candida ), and Brazilian stylo ( Stylosanthes guianensis var. guianensis ) some of which are already in use in SE Asia (Paterson and Lima 2018 ). The biodiversity of the plantation will be increased per se as each plant is introduced and by the increase in nitrogen fixing bacteria associated with the legume.
Soil management practices including (a) empty fruit bunch (EFB) application, (b) palm frond application and chemical fertilization improving soil fauna (worms, beetles, and ants) feeding activity, and (c) better soil chemical properties, all of which show considerable promise. EFB applications greatly enhanced soil fauna feeding activity and are associated with increased concentrations of base cations and soil moisture. This elevated biological activity has good potential to assist ecosystem functions such as litter decomposition, nutrient cycling, organic carbon stabilization, and ultimately oil palm productivity. The use and presence of earthworms may increase the effectiveness of growing oil palm, as they can contribute to soil turnover, structure formation and serve as a fertility enhancer and, again, increase biodiversity (Paterson and Lima 2018 ).
Developing new oil palm varieties resistant to climate change is another possibility (Rival 2017 ), although may not be easily achieved. Breeding oil palm for climate change requires multidisciplinary and collaborative research at a high level (see next section). Selecting for complete resistance, rather than tolerance to diseases, leads to high selection pressures for new variants of the pest/pathogen that can overcome the resistance in the crop. Resistant oil palm cultivars to climate change, or environmental stress, may overcome the less favourable growth conditions imposed by climate change (Tang 2019 ). However, it is impossible to know accurately what climate changes will be needed to enable resistant cultivar development, e.g. a cultivar resistant to desiccation stress may be sensitive to high temperature. High fertilizer use causes increased emissions of GHG from manufacturing, transportation, and application, and improvements will be required in oil palm nutrient uptake efficiency by breeding for suitable root systems.
Methods that ameliorate the effect of (a) climate change on oil palm and (b) oil palm cultivation on climate change include the following: Optimizing the rhizosphere by adding arbuscular mycorrhizal fungi (AMF) will also assist in reducing climate change with generalized benefits to oil palm growth, by reducing the need for fertilizer for example. Arbuscular mycorrhizal (AM) symbioses have beneficial effects on water transport to assist in overcoming drought conditions, of relevance particularly to ameliorating climate effects. Reducing fertilizer production and use will cause decreased emissions that lead to climate change, and the use of AM could ameliorate the effects on oil palm. AM and AMF addition will increase biodiversity within plantations (Paterson and Lima 2018 ).
“Slash-and-char” as an alternative to “slash-and-burn” of forests cleared for oil palm may be beneficial and feasible. Slash-and-char effectively produces charcoal to sequester CO 2 normally employed for forest residues. This could be used more extensively to improve agriculture in the humid tropics, enhancing local livelihoods and food security, while sequestering various forms of carbon (C) to mitigate climate change. Biochar soil management systems can deliver tradable C emissions reduction as the C sequestered is accountable and verifiable. The fraction of the maximum sustainable technical potential that is realized will depend on socioeconomic factors, including the extent of government incentives and the emphasis placed on energy production relative to climate change mitigation (Paterson and Lima 2018 ). Reduced tillage is another possibility for affecting climate change, where reducing tillage with AMF provides the optimal conditions for oil palm. Low tillage combination with AMF assists nutrient uptake, water relations, and protecting against pathogens and toxic stress, hence potentially ameliorating the effect of climate change on oil palm growth. Also, low tillage will decrease the emission of GHG from oil palm plantations (Paterson and Lima 2018 ).
An important tool used by policymakers to assess the impacts of a particular cropping system is life cycle assessment (LCA) (Schmidt 2015 ; Yee et al. 2009 ). This method seeks to estimate the impact of all aspects of the production process from planting seed, growing, harvesting and processing the crop (including fuel and labour costs); application of inputs such as water, fertilizer, herbicides, and pesticides; shipping of the oil overseas and downstream conversion into products such as foods and oleochemicals; transport to wholesalers, retailers, and consumers; and finally, disposal of products at the end of their lifetimes. Unfortunately, very few published studies cover the entire system ‘from cradle to grave’.
The most effective manner of addressing climate change is to adhere to policies devised at the 2019 COP25 climate meeting by reducing GHGs and future temperature rises. Conservation scientists, managers and environmental policymakers need to adapt their guidelines and policies to mitigate the impact of climate change (Brooke 2008 ). The new recommendations from COP meeting in Glasgow, Scotland in 2021 should be implemented as a matter of urgency as the most effective procedures for controlling climate change and consequently the effects of climate change on oil palm. Importantly, palm oil producers should also collaborate more effectively to help shape future policies on climate change and oil palm.
Breeding and biotechnology to improve oil palm as a crop
Recently, there have been several significant advances in breeding and biotechnology use for oil palm improvement. This is despite the challenges posed by the long-lived perennial nature of oil palms, which are large plants typically grown commercially for > 25 years. Hence, such biological strategies are much more complex and lengthier to implement compared to the smaller, faster growing annual crops. Breeding efforts have tended to focus on major economic traits such as oil yield and composition, pest and disease resistance, and plant architecture. Until relatively recently, oil palm breeding was also disadvantaged by the restricted genetic pool of commercial varieties, most of which were derived from small numbers of plants imported from Africa to SE Asia in the nineteenth and twentieth centuries. The available gene pool has now been greatly expanded, largely thanks to a series of germplasm collection expeditions to Africa and South America by pioneering breeders such as Rajanaidu et al. ( 2014 ). This has now allowed for genome-wide association studies (GWAS) of key traits such as oil yield and fatty acid composition (Ithnin et al. 2020 ) in the case of American oil palm and an Elaeis oleifera × Elaeis guineensis hybrid (Osorio-Guarín et al. 2019 ). Recent breeding-related reviews include genomics, genomic selection (Nyouma et al. 2019 ), transgenics (Costa et al. 2012 ), genome editing (Yarra et al. 2020 ), and marker-assisted selection (Ting et al. 2018 ; Babu et al. 2019 ). Following the publication of the oil palm genome sequence in 2013 (Singh et al. 2013 ), several detailed linkage maps have now become available for the use of breeders (Ong et al. 2019 ; Herrero et al. 2020 ).
Genomics-based strategies such as marker-assisted selection are already generating several useful advances for a variety of important traits that include oil yield, fatty acid composition and crop morphology (Xia et al. 2019 ; A quantum leap with genome select 2020 ). One of the most exciting recent developments was the announcement in mid-2020 of new breeding lines that are capable of more than double the current average oil yield (A quantum leap with genome select 2020 ). These plants are part of a genomics-based programme called ‘Genome Select’ carried out by plantation company Sime Darby, with a claimed 9.9 t/ha average yield over 5 years in field trials under optimum conditions. Given that current average palm oil yields are less than 4 t/ha, and that soybean and rapeseed only yield 0.3 and 1.2 t/ha respectively, this could be a game changer for the industry if two important conditions are met. Firstly, the experimental lines will need to be assessed for their oil yield performance under commercial plantation conditions in a range of geographic regions and, if necessary, crossed with locally adapted varieties. Secondly, the new higher yielding varieties need to be part of an ambitious replanting programme that will potentially replace a significant proportion of the estimated 2.5 billion oil palms that are currently under cultivation worldwide.
In terms of molecular genetics approaches to BSR mechanism and control, G. boninense genome and transcriptome data are now available with two G. boninense genome assemblies in the NCBI Depository (Wong et al. 2019 ), which provides a table listing publicly available genome and transcriptome data associated with the G. boninense and G. boninense -oil palm pathosystem. High-throughput next-generation sequencing and improved bioinformatics analyses has greatly facilitated G. boninense pathogenesis and housekeeping candidate gene identification. However, G. boninense remains poorly studied with respect to system-level gene function studies and biotechnology manipulation, with no available gene co-expression network models. Most studies have focused on host transcriptome data, whilst similar studies on the pathogen remain scarce. Ho et al. ( 2016 ) utilised mass RNA sequencing and de novo assembly of RNA-seq and were able to detect a high number of Ganoderma transcripts involved in lignin metabolism, such as manganese peroxidase and laccases. It is encouraging that, very recently, in silico mapping within an oil palm breeding program has revealed several QTL associated with genetic resistance to G. boninense (Daval et al. 2021 ).
Publication of the transcriptome of G. boninense at monokaryon, mating junction and dikaryon stages (Ho et al. 2016 ; Daval et al. 2021 ; Govender et al. 2020 ) will be useful for investigation of the mating process of this fungus. However, annotation and functional studies of these differentially expressed genes at different stages have not yet been done. RNAi as a tool for functional genomics to study developmental or virulent genes is lacking, although the genome has been sequenced, and there is the promise of new approaches to molecular breeding using genome editing technologies such as CRISPR-Cas-9. The role of genes involved in ergosterol biosynthetic pathway in G. boninense utilizing RNAi-mediated gene silencing is currently being investigated (Govender et al. 2020 ). The identification and verification of candidate genes are crucial for the application of these targets in RNAi-based crop protection, such as host-induced gene silencing (HIGS) or spray-induced gene silencing (SIGS). In addition, a study on the potential application of RNA silencing targeting DCL genes of G. boninense to confer protection against basa 581 stem rot is in progress (Govender et al. 2020 ). The availability of G. boninense genome data in public database (NCBI) enables potential candidate genes to be identified for testing and designing of efficient silencing constructs to avoid off-target transcripts, whilst the availability of the oil palm genome data helps to ensure the silencing constructs do not target and negatively affect the host. Because G. boninense on attacks oil palm by degrading lignin (Fig. 1 ), there is the possibility of modifying lignin to make oil palm plants more resistant. Alternatively, making the plant more resistant to initial fungal colonization by inhibiting carbohydrate metabolism first is a more logical approach that possibly overrides the emphasis on lignin per se (Govender et al. 2020 ).
Global supply chains and consumer sentiment
Palm oils are globally traded commodities with lengthy and complex supply chains, which can impede implementation of sustainability criteria, such as no-deforestation (Lyons-White and Knight 2018 ). This complexity is further increased by non-economic factors including sustainability, traceability, disease monitoring and pest management. More recently, however, a more constructive dialogue has emerged as several NGOs and community groups have joined with bodies such as RSPO and some major industry players in exploring initiatives such as certification schemes, that seek to guarantee that palm oils are sourced from sustainable and environmentally friendly sources (RSPO 2009 ).
Palm oil supply chain and traceability
Due to increasing awareness of the wider impacts of oil palm crops, sourcing of palm oil from verified, certified sustainable/responsible sources is of growing interest. Supply chain traceability ensures that information about products can flow easily and enable consumers to have maximum information about product origins. Certification schemes have mostly been established to improve sustainability within the industry, but for these to operate openly and transparently, supply chain traceability is an essential requirement. An overview of a typical palm oil supply chain is displayed in Fig. 4 . The most widely used sustainable certification scheme, which aims to improve traceability, is RSPO (RSPO Supply Chains 2017 ). A graphical overview of each model is also displayed in Fig. 5 :
Identity Preserved (IP): sustainable palm oil is derived from a single source and kept separate from all other sources throughout the entire supply chain
Segregated (SG): sustainable palm oil is derived from multiple sources and mixed; it is then kept separate from conventional palm oil throughout the supply chain
Mass Balance (MB): sustainable palm oil is mixed with palm oil from non-certified sources in a controlled and regulated manner
RSPO credits: the supply chain is not monitored for the presence of sustainable palm oil. But manufacturers and retailers can buy credits from RSPO-certified growers, crushers and independent smallholders
A conventional palm oil supply chain with no certified traceability. The palm oil is produced, transported, refined, incorporated into products and then used by the customer
The four different RSPO supply chain models including Identity Preserved, Mass Balance, Segregated and Book and Claim (source: www.rspo.org ). The premise of how each supply chain works is described in-text. All palm oils produced under RSPO certification are able to carry RSPO branding, though in the case of Mass Balance and Book and Claim, there is no guarantee that 100% sustainable palms oils are being used
Labelling, health and nutrition
Labelling has been shown to influence consumer purchasing habits and to have positive impacts on food production. RSPO believes that using its certification trademark on products will be central to raising awareness and driving demand. Palm oil is used for cooking and is also added to many ready-to-eat foods. Its taste is considered savoury and earthy, with some people describing its flavour as being similar to carrot or pumpkin. It has been a staple in West African and tropical cuisines for millennia (Corley and Tinker 2015 ). In recent years, the public debate on the health and sustainability of palm oil and its use by food industries has strongly influenced consumer choices. There has been a perception that palm oil, with its relatively high saturated fat content, has adverse nutritional qualities, despite its long history as an important indigenous foodstuff in the tropics. This perception has been strongly challenged by recent meta-analyses and prospective observational studies, mainly conducted in North America and Europe, that failed to demonstrate a correlation between total saturated fat intake and an elevated risk of cardiovascular disease (Chowdhury et al. 2014 ).
Production of sustainable palm oil is recommended so that consumers only buy from companies using palm oil certified under RSPO, or similar certification schemes that have transparent commitments to improved ecosystem services and human wellbeing (Ayompe et al. 2021 ). Certification schemes improve consumer confidence and provide a high level of guarantee that that areas of high conservation value are preserved, local communities are supported, and that palm oil plantation managers are implementing best practices including for sustainability and the fair use of labour (Carlson et al. 2018 ; Schoneveld et al. 2019 ; Furumo et al. 2020 ; Santika et al. 2021 ). Whilst some groups have criticized certification schemes for not moving far or fast enough, researchers and NGOs such as WWF are working with schemes like RSPO, to facilitate greater progress and to include more progressive criteria for best practice, in order to certified. An example of such developments was the announcement in mid-2021 of a multi-stakeholder initiative called Project Lampung (Bootman 2021 ). This was launched with the aim of linking smallholder farmers in the Lampung province of Indonesia with the NGO, Solidaridad, plus multinationals (including BASF, Cargill and Estée Lauder) in order to enable their palm oil to reach global markets via RSPO certification (RSPO 2021 ).
As with many other sectors of commercial agriculture, the global oil palm industry is currently facing significant future challenges as it comes under increased scrutiny in an increasingly interconnected world. Many of these issues, such as the future of palm-based biodiesel, the stagnation in crop yield and related labour problems, and concerns about sustainability and environmental impact are relatively longstanding, but they have been brought into sharper focus as a consequence of the COVID-19 pandemic that started in 2020 and is likely to have long-term effects on the industry as will now be discussed.
An uncertain future for palm-based biofuels
Over the past decade a growing proportion of palm oil has been used as a biofuel, mostly in the transport sector as biodiesel derived from methyl esters of the oil. Most palm biodiesel is consumed locally in Malaysia and Indonesia. This is due to government-supported mandates that enforce the mixing of palm biodiesel with petroleum-derived diesel. However, the use of palm biodiesel as a carbon–neutral fuel in the wider global transport sector has proved to be controversial, especially in the EU (Muzii 2019 ). Until very recently, a substantial and growing amount of palm biodiesel, totalling 4.9 Mt in 2018, was used in the EU. As shown in Fig. 6 , for over a decade the EU has steadily increased its imports of palm oil for fuel use while the amount used for food, feed and oleochemicals has declined from a high of almost 4 Mt to about 2.7 Mt (Chandran 2019 ). These data show that in 2018 the EU imported a total of 7.6 Mt palm oil but only 2.7 Mt (36%) of this was for food and personal care use, while the remaining 4.9 Mt (64%) was for use as transport biodiesel or fuel oil (e.g. for electricity generation).
Source: Ref. Muzii ( 2019 )
EU palm oil consumption by end use. A steady decline in food use is mirrored by an increase in biodiesel use for palm oil imported into the EU from 2008 to 2018.
As described above, concerns about the environmental impact of oil palm cultivation and the use of food crops for biofuel, coupled with recent advances in electric vehicle (EV) technologies, mean that the EU is now moving away decisively from both crop-based biofuels and fossil fuels, with many countries seeking to replace all carbon-based fuels by 2050. In the medium term, as fossil oil use continues to decline and its price remains low, there are few prospects that palm biodiesel will compete effectively on price in international markets. This is likely to reduce the global market for palm biodiesel, although the additional palm oil that this would release should still be in high demand for edible uses. For example, Corley and Tinker 2015 ) estimated that, by 2050, a further 6 Mha of land could be required to meet total oil palm production requirements, which is a formidable challenge in view of the scarcity of environmentally suitable land. However, if most of the current palm that is diverted to biodiesel is switched to food use, about 3–4 Mha of this additional land would not be required.
On the production or supply side, the oil palm sector faces several significant challenges that include new scientific advances, changing patterns of global trade and consumer sentiment, and the related issues of labour and mechanization. The efficiency and effectiveness of plantation management varies greatly across the sector, both among large commercial enterprises and individual smallholders. One of the most remarkable features of the oil palm is the stagnation in yields at values around or under 4 t/ha over the past two decades (Chandran 2019 ). As shown in Fig. 7 , this is in marked contrast to other major crops, including oilseeds, which have shown consistent yield increases in response to factors such as biological improvements, improved management and more efficient transport and supply chain infrastructure. In some cases, modelling analysis can provide new insights into plantation management that suggest possible improvements. A recent example is the application of model optimization and heuristic techniques that indicated significant potential for yield improvements by reducing the harvest cycle length from 19.6 to 8.3 days in a plantation in Columbia (Escallón-Barrios et al. 2020 ). Innovative new ideas for ‘smart’ oil palm mills have also been advanced (Isaac 2019 ) as well as the use of digital technologies, such as blockchain, to enhance the performance and transparency of supply chains (Keong 2019 ).
Source: Ref. Chandran ( 2019 )
Stagnation of average oil yield (in tonnes per hectare) in Malaysian OP crops (right-hand axis) compared to two major competitor oilseeds, rapeseed and soybean (left-hand axis).
The oil palm cropping system is unusual in its continued reliance on large amounts of relatively unskilled manual labour that must operate in a humid and hot tropical climate on a year-round basis (Crowley 2020 ). During recent decades many plantations have increasingly relied on temporary migrant labour, but low wages and increasing incomes from alternative forms of employment have created staff shortages, which were greatly exacerbated by the COVID-19 pandemic (Crowley 2020 ; Raghu 2021 ). These problems have been compounded by allegations of poor labour practices in some plantations that led to the blacklisting of some of the largest commercial companies and import bans by the US Customs and Border Protection in 2020–21 (Jamal 2021 ).
In the long term, the most realistic solution to the current labour problems that plague the sector is to introduce more mechanization and shorter plants, as has been done for several other staple monocot and tree crops (Murphy 2011 ). One way of facilitating mechanization and increasing yield is to use modern molecular breeding approaches to modify crop architecture, for example to reduce trunk height as has been done with apples and major cereals such as wheat and rice (Murphy 2011 ; Nagai et al. 2020 ). Interestingly, a very recent study has identified three major QTLs associated with oil palm height on chromosome 11, which could facilitate the breeding of shorter and more compact palms for enhanced yield and ease of harvesting (Teh et al. 2020 ). Replanting of ageing and/or poorly performing palms is a vitally important strategy for improving the yield, and hence the overall sustainability and environmental footprint of oil palm crops. This applies to both large commercial growers and smallholders, many of whom use inferior seeds bought from middlemen with no record of their provenance. While there have been government initiatives in Malaysia and Indonesia, these efforts need to be redoubled and made more effective (Shehu et al. 2020 ; Yahya et al. 2020 ; Oosterveer 2020 ).
Sustainability and environmental challenges
The use of oil palm as a food ingredient in the large EU market has been in steady decline over the past decade (Fig. 6 ). There is little doubt that part of this decline has been due to adverse consumer sentiment about the oil palm industry in general and there are now discussions in the EU to require verifiable ‘point of origin’ declarations for all food-grade palm oil (Southey 2020 ). This could mean that any oil that cannot be reliably identified as from a sustainably certified source, such as RSPO, might not be imported into the EU. Clearly the industry needs to address these certification and authenticity issues in its supply chains to ensure that it becomes fully compliant with the requirements of its second largest customer, namely the EU.
The global oil palm industry is a major component of contemporary agriculture, supplying food to billions of people, plus a host of non-food products that include strategically vital cleaning products used in critical health care settings. However, there are well founded concerns about the expansion of oil palm plantations into sensitive habitats, such as highly biodiverse tropical forests and peatlands (Meijaard and Sheil 2019 ; Meijaard et al. 2018 ). There are no viable alternatives to oil palm in terms of its yield and delivery of a range of specific oils for human use (Parsons et al. 2020 ). It is therefore important to implement transparent and effective certification schemes right across the industry to guarantee that oil palm products can be labelled as being derived from environmentally sustainable and socially responsible sources. It is also important to recall that deforestation and habitat loss are also associated with the second most important global oil crop, soybean. Policymakers may therefore need to consider ways to reduce the demand for oils more specifically and for unhealthy ultra-processed foods more broadly. The industry also needs to redouble its efforts to engage with global consumers in a constructive dialogue aimed at addressing its image problem and explaining the many benefits of its products (Reardon et al. 2019 ; Borrello et al. 2020 ). Oil palm crops face many other challenges, including emerging threats from climate change and the likelihood of new pests and diseases, that require more effective international collaboration. The influential players in the industry need to interact with the key organizations and countries now fully committed to reducing climate change. Nevertheless, new breeding technologies are providing the promise of improvements in some areas, such as much higher yielding varieties, improved oil profiles, enhanced disease resistance and modified crop architecture to enable mechanization of fruit harvesting.
Availability of data and materials
- Basal stem rot
Fresh fruit bunches
Genetic manipulation (via transgenesis)
Genome-wide association studies
Life cycle assessment (or analysis)
Quantitative trait locus
Roundtable on sustainable palm oil
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Murphy, D.J., Goggin, K. & Paterson, R.R.M. Oil palm in the 2020s and beyond: challenges and solutions. CABI Agric Biosci 2 , 39 (2021). https://doi.org/10.1186/s43170-021-00058-3
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DOI : https://doi.org/10.1186/s43170-021-00058-3
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We are the major producers and consumers of vegetable oils. During 2013-14, the production of vegetable oil is 9.64 million tonnes. The domestic availability of edible oil is continues to remain inadequate to meet the demand for it. There is wide gap between demand and availability of edible oils. Therefore, the government is imported from other countries. Oil palm satisfies 30 percent of the world edible oil and fat requirements with little fewer than seven percent of the area planted to oil crops. The palm oil production is 0.785 lakh tonnes in India. The production level is very meagre level. In future, there is wide demand for consumption of common men in India. But the area under palm oil is 19.30 lakh ha from 19 states and 2.62 lakh ha was planted upto March 2014. In the fourth coming years of 2050, the country will be needed to expand the area under oil palm is to 14.04 million tonnes from 31.03 million of vegetable oils for solving 1620 million population. The share of palm sector in the vegetable oil requirement will be 45 percent in India. The domestic production of palm oil is inadequate to meet the palm oil demand in India. The import of that is increased from 41 percent in 2001-02 to 61 percent in 2012-13. During 2012-13, the palm oil was imported of 10.40 MMT. The palm oil is consumed all most all the people in India in recent years due to price rise of other oil. During 2012-13, we are use of vegetable oil of 8.67 MMT. Out of that, palm oil accounted for 50 percent of the total edible oil consumption. To meet the increasing per capita consumption of palm oils along with the population growth, there was an urgent need to increase the production and productivity of palm oils in India. To tackle this problem, the Government of India has been initiated expand the large scale cultivation in the country. The Palm Oil Area Expansion scheme was started for the expansion of that oil.
Iris van Duren , Alfred Duker
The oil palm plantation sector has been one of the front-runners in the Indonesian agriculture sector. The development of the oil palm plantation is aimed at employment creation, poverty alleviation, and rural development. The market of Indonesian palm oil has been substantially growing nationally and internationally. Such development is, however, criticised for causing environmental degradations and having adverse socio-economic impacts by bringing about land conflicts. Based on a field research on oil palm plantations in Riau province in 2012, this chapter reveals decent work deficits on oil palm plantations, contributing to the discussions on socio-economic implications of Indonesian palm oil sector development. The chapter particularly focuses on the attempt in measuring decent work deficit in the agriculture sector, particularly on oil palm plantations. To this end, the discussions start with a brief profile of the Indonesian oil palm plantation sector. The concept of decent work is then discussed, including criticisms and challenges in measuring decent work deficits in the agriculture sector.
This study analyzes the profitability of fruit juice processing using data from Kudors Fruit Juice Limited at Kasoa in Ghana. The cost involved in fruit juice processing (which includes the capital cost and the operating cost) was obtained from the Company. This study compares the profitability of blend (i.e. fruit juice made up of pineapple and mango blend) with that of pineapple juice alone. The viability of the project was determined using the discounted measures of project worth: Benefit-Cost Ratio (BCR), Net Present Value (NPV) and Internal Rate of Return (IRR). The empirical results reveal that pineapple juice processing had a BCR of 1.03 which means that going into the pineapple juice processing is profitable. The value of the NPV (GHS11,728.00) and IRR (23%) further confirms that pineapple juice processing is profitable because the NPV is positive and the IRR is greater than the discounted factor (21%). The results also showed that it is more profitable to invest in the blend (pineapple and mango blend) than the pineapple juice alone as it yields a BCR of 1.36 which was greater than the BCR of 1.03 for the pineapple juice only. Furthermore, the value of the NPV (GHS176,831.00) which is greater than the pineapple juice only, suggests that the blend is more profitable even though the IRR for both are the same. Moreover, it is also more likely to recover capital investment earlier in the processing of the blend than when one goes into pineapple juice processing only, because the net cash flow in year 2 (GHS 58,146.00) for the blend is more than triple that of the pineapple juice only (GHS17,826.00).These results have policy implications for the development of Agribusinesses in Ghana.
Extensive review of academic and grey literature published between 2005 and 2016 on food systems in Accra, Ghana. The report present the latest findings and recommendations in order to provide all the stakeholders involved from food production to processing and distribution, catering, and policy making, updated, relevant, scientific reference to support their actions towards the development of food se-curity and nutrition of city dwellers.
Diana Pastrana Cervantes , María del Rocío Ruenes Morales
2018, Decent Work Deficits in Southern Agriculture: Measurements, Drivers and Strategies
This report presents the findings for Ghana of the DFID funded project ‘Assessing the poverty impact of sustainability standards', which is led by the Natural Resources Institute, University of Greenwich in collaboration with KNUST and Jeavco Associates, Ghana. The study (2009-13) objective was to systematically examine the impact of voluntary social and environmental standards on poverty and livelihoods, particularly for the most disadvantaged workers and producers in developing countries.
Lim GHEE THEAN
The study investigates factors that influence consumers purchasing decision at Kedai Rakyat 1Malaysia (KR1M) and consumers perception towards KRIM. A survey was conducted using structured questionnaires which were randomly distributed in three KR1M's stores located in Putrajaya and Kelana Jaya. A total of 216 respondents were involved in this study. Majority of the respondents perceived that KR1M's products were based on consumers' economic status. Four factors were revealed to influence consumers' decision while purchasing at KR1M namely price of the products, quality of the products sold, packaging of the products, and convenience of the stores. This study recommended that the management of KR1M needs to carry out relevant promotions to increase consumers' awareness towards the store's name of KR1M and its house brand products.
Abdul Aziz Issah
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Sample Palm Kernel Oil Production Business Plan PDF [Template]
If you’re planning on starting this enterprise, you’ll need the tips or guide provided in this palm kernel oil production Business Plan PDF [Template].
If you’re into food processing , one of the things you should know is the need to have your business structured.
This is only possible when there’s a plan of action. The business plan systematically lays out the processes of growth, sets a clear and achievable goal as well as charts the path towards sustainability.
This plan has been written specifically to help entrepreneurs put together a comprehensive plan for their businesses.
Here is a business plan for palm oil processing .
PALM KERNEL OIL PROCESSING BUSINESS PLAN
How your palm kernel oil production business plan unfolds is crucial. Its systematic arrangement helps to coordinate your points.
These points are key sections within the plan which address different aspects of the business. They include the executive summary and the company description section.
That’s not all.
Other equally important sections of the plan include the products & services section, market analysis, strategy & implementation, organization & management as well as financial plan & projections.
At this point, we’ll go into the basics of what should follow under each of these sections.
i. Executive Summary
The name alone conveys its meaning. The executive summary section provides an overview of your palm kernel oil production business plan.
Just like the plan, putting together the executive summary is a painstaking process that seeks to condense the key aspects of the plan to make it evident to the reader.
The executive summary should be able to stir the interest of an investor to consider the business idea as being worthy of attention. In other words, your executive summary should be able to hold the attention of your audience to make them want to read more.
The executive summary appears first in the palm kernel oil business production business plan.
It contains key sections such as the business name & location, the products & services offered, and the mission & vision statements.
Other key inclusions are the specific purpose of the plan.
Business Name & Location
Without a name, your business will be considered non-existent.
For a real shot at growth, you’ll need to give your business a name. This is introduced together with the business’s location. Where are your operations coordinated from?
Location is important to business and you should state why such is beneficial to your palm kernel oil production business.
Products & Services Offered
Here, anyone reading through your executive summary should know the basic products and services offered. It’s a no-brainer that your products will be derived from palm kernel fruits. Nevertheless, have all such products listed.
How beneficial are such products to your clients?
A dedicated section is provided for all the tiny details regarding the products and services being offered. Here, you’ll need to include any other services rendered by your business.
Mission & Vision Statements
The mission and vision statements of your palm kernel oil production business provide a clear direction the business is headed to. The mission statement relays your company’s primary objectives and purpose clearly and concisely.
The vision statement on the other hand focuses on your aspirations and goals. These are written in a manner that easily reveals how passionate you are about achieving set objectives.
In a nutshell, the vision statement should be inspirational and achievable.
Purpose of the Plan
The purpose of the plan is key to its attainment.
What do you want to achieve with our palm kernel oil production business plan? Is it to raise funding and set growth strategies in place?
These should be clearly stated to ensure easy comprehension by your audience.
ii. Company Description
This is where details about your palm kernel oil production business are fully unveiled.
Here, you want to explain who you are, how the business operates as well as set goals you wish to accomplish. So, what legal structure are you adopting for the business?
Have a brief history included? The company description section should also touch on the needs your palm kernel oil product will satisfy. A summary of your products and services including customers and suppliers should be given.
Write a summary of company growth with the market and financial highlights included. Last but not least, provide information about your short and long-term goals.
iii. Products & Services
This is the point where you describe all products and services offered by your palm kernel oil production business.
In describing such products and services, you want to emphasize customer benefits.
Also, you’ll need to include the market role of your products and the clear advantages it has over those of your competitors.
iv. Market Analysis
The market analysis section is where you demonstrate industry knowledge.
Here, a sketch of target customer segments with size and demographics is added. This includes a description of the industry and its outlook backed by statistics.
Providing historical, current & projected marketing data for your products and services will be in order. Evaluate your competitor’s strengths and weaknesses too.
v. Strategy & Implementation
The sales and marketing strategies being adopted for your palm kernel oil business are crucial. You need to explain how the business will be promoted or marketed.
Also to be included are details on pricing, costs, promotions, and distribution.
How will the company operate? Include details about its operational cycle. What are your sources of labor?
vi. Organization & Management
The quality of organization, as well as management, determines the success of your palm kernel oil production business.
You’ll unveil your company’s organizational structure with a focus on the key departments, employees, owners, as well as profiles of your management team.
vii. Financial Plan & Projections
The financial plan & projections section takes a detailed look at the financial statements.
Here, the help of a financial expert is necessary for a thorough job.
Key aspects to be analyzed include the historical financial data, realistic prospective financial information as well as a brief analysis of your financial data.
There you have it! With these sections adequately covered, your plan should be well written and enhance the realization of set objectives.
More importantly, its detailed implementation would ensure you’re on track to achieving your goals.
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Palm Oil Business Plan
- Executive Summary
- Products & Services
- Market Analysis
- Management Plan
What you get with palm oil business plan package, i.- executive summary.
Olive Tree Palm Oil, LLC is founded out of a desire to fill an identified need in the market for sustainable palm oil. Despite the growing demand for palm oil, traditional sources of palm oil are largely unsustainable and can have a serious impact on the environment. Olive Tree Palm Oil, LLC offers an alternative—sustainable and ethically-sourced palm oil from local, family-run farms in Portland and the surrounding areas. Our goal is to provide a safe and sustainable source of palm oil that meets the needs of our customers without compromising the environment.
Olive Tree Palm Oil, LLC is providing an innovative solution to the problem of unsustainable palm oil production. Through our sustainable palm oil products sourced from local, family-owned farms, customers are guaranteed the highest quality of palm oil available. We also provide educational materials to help customers understand the importance of sustainability when it comes to palm oil production. In addition, customers can save money on our discounted rates for sustainable palm oil products.
By working with local, family-owned farms and providing sustainable palm oil products, Olive Tree Palm Oil, LLC is playing a pivotal role in promoting sustainability and helping to protect the environment while also serving its customers. Customers can purchase our sustainable palm oil products with the assurance that they are making an environmentally conscious decision that will benefit future generations.
Olive Tree Palm Oil, LLC has crafted a target market of customers who are looking for ethically-sourced, sustainable palm oil products. Our target customers include any individual, business, or organization looking to purchase palm oil products from trustworthy and reputable sources. We are committed to providing them with high-quality products that are sustainably produced from our family-run farms. Additionally, we will target customers looking for educational materials about sustainable palm oil production, as well as those looking for discounted prices for their sustainable palm oil products.
The competitive landscape in the sustainable palm oil market is intense, with a wide range of products and services vying for customer attention. Olive Tree Palm Oil, LLC will be competing against traditional palm oil products as well as a variety of other sustainable palm oil providers. Many of these competitors offer their customers cheaper, less sustainable options for their palm oil needs. In order to stand out from the competition, Olive Tree Palm Oil will focus on providing quality, sustainable palm oil from family-run farms, as well as offering discount options for our customers. We will also offer educational materials about sustainable palm oil production and help our customers find sustainable palm oil suppliers in the area.
The financial plan of Olive Tree Palm Oil, LLC is designed to cover all costs associated with the establishment and operation of our sustainable palm oil business. Our plan is divided into key highlights related to our sales, costs, and profitability. These elements are detailed in the below bullet points.
- We anticipate our initial costs to launch the business to be approximately $15,000, including legal fees and necessary equipment.
- We anticipate that our sales will reach $120,000 in year one and grow to $400,000 by year three.
- We forecast that our yearly gross profit will reach $240,000 by year three.
- Our business plan outlines a marketing strategy intended to best position our brand and products within the industry.
- We intend to reinvest our profits back into the company by reinvesting in marketing, product research and development, and diversifying our product offerings.
Olive Tree Palm Oil, LLC will require capital investment for the following:
- Startup and operational expenses
- Equipment and infrastructure
- Research and development
- Marketing and promotion
- Supplier and vendor relationships
- Employee salaries
The total amount of capital needed to become operational is estimated to be around $500,000. Funds will be allocated across the aforementioned categories to ensure the company has sufficient capital for startup costs and that our sustainable palm oil business can become profitable in a timely manner.
Milestones & Traction
At Olive Tree Palm Oil, LLC, we understand the importance of setting and achieving tangible goals for our company’s progress. We have outlined our current position in the market, as well as short-term and long-term goals. This roadmap is broken down into several categories, such as product research and development, operational set-up, customer engagement, and outreach initiatives.
In the product research and development category, we are currently in the process of researching and developing sustainable and ethical palm oil production practices. We are aiming to develop a variety of refined and unrefined palm oil products to suit the needs of our customers. By the end of 2021, we plan to have completed research and development of these products, and to have them ready for sale to our customers.
In the operational setup category,we plan to open a production facility in Portland, Oregon by the end of 2021. This facility will allow us to process, refine, and package our sustainable and ethical palm oil products. We also plan to use the facility to provide educational materials and resources about the positive impact of sustainable palm oil production.
In the customer engagement and outreach category, we plan to roll out a comprehensive marketing plan by the end of 2021. This plan will focus on increasing our reach and visibility within the Portland area, and on engaging with new and existing customers. We will also be looking to partner with local organizations, to help spread our message of sustainable palm oil production.
Finally, we plan to review and monitor our progress regularly, in order to ensure that we are achieving our goals and staying on track. This review process will not only help us assess our progress, but also take into consideration any developments that may impact our operations.
II.- Products & Services
The current dilemma facing consumers is that palm oil is associated with negative environmental impacts and unethically sourced from large-scale plantations. The global palm oil industry is dependent on unsustainable harvesting, leading to habitat destruction and displacement of local communities. As a result, an alternative source of palm oil that is socially and environmentally responsible is needed.
Olive Tree Palm Oil, LLC will offer a comprehensive suite of palm oil products and services to address the needs of our customers. Our core offering is sustainably sourced palm oil, which we will acquire from family-run palm oil farms in the local Portland area. We provide both refined and unrefined palm oil products, giving our customers multiple options for their needs. In addition, through Olive Tree Palm Oil, LLC, we will also provide educational materials about sustainable palm oil production methods and help customers locate the best suppliers in the area. We will also offer our customers discounts on sustainable palm oil products, giving them the opportunity to buy quality sustainable palm oil at an affordable price. By providing these comprehensive products and services, our customers will be able to find the best, most sustainable palm oil to meet their needs.
Validation of Problem and Solution
The current market for palm oil is largely dominated by non-sustainable suppliers, and this has led to a lack of environmental and social stewardship in the production of palm oil. Studies have demonstrated that sustainable production of palm oil can reduce environmental pressures and safeguard health and livelihoods of local communities. Olive Tree Palm Oil has conducted research to assess the feasibility and impact of introducing sustainable palm oil to the region. Our findings demonstrate that there is a strong market for sustainable palm oil, and that consumers are willing to pay a premium for ethically sourced products. Furthermore, our extensive on-the-ground research has identified local sources, suppliers, and processors that can provide high-quality sustainable palm oil at a price that is competitive in the market.
Olive Tree Palm Oil, LLC is committed to providing quality, sustainable palm oil sustainably sourced from our family-run farms. We offer a variety of refined and unrefined palm oil products to meet the needs of our customers, from luxurious soaps and aromatic oils to commercial-grade ingredients for food processing. Our products are sustainably sourced from our family-run farms, providing customers with a safe, ethically-sourced alternative to traditional palm oil. We also provide educational materials, discounted pricing, and assistance for customers with finding suppliers. Utilizing our sustainable palm oil products provides our customers with the confidence that they are using a product that is certified safe and sustainable.
The sustainable palm oil market is relatively new, and there is not a great deal of competition in the space. However, there are a few business startups offering products similar to ours. Our product stands out by providing quality, sustainable and locally sourced palm oil at an affordable price. We also provide helpful educational materials about sustainable palm oil production and assistance in finding the best palm oil suppliers in the area. These additional offerings set us apart from our competition, as well as offering more than just traditional palm oil.
As part of our mission to provide our customers with quality and sustainable palm oil, we have already taken key steps to establish our business, from choosing a location to submitting the necessary paperwork. Our roadmap to setting up a sustainable palm oil business is as follows:
- Location scouting and selection
- Visiting local, family run-farms to secure our sources of sustainable palm oil
- Registration and licensing
- Formation of our core team
- Determining the pricing of our products
- Developing a comprehensive educational outreach program
- Creating a safe, integrated sales process
- Identifying reliable suppliers of sustainable palm oil
Our roadmap reflects the continuous commitment and hard work of our team to provide our customers with a unique and sustainable palm oil experience. We look forward to continuing to grow in the years to come.
III.- Market Analysis
The potential customers for Olive Tree Palm Oil can be segmented into various groups to identify the clear target market. Segmentation is done based on various characteristics such as geographical area, income, preferences for sustainable oil, financial capabilities etc.
The segmentation table is given below:
Target Market Segment Strategy
Our target market segment for our Palm Oil business will include industries looking for reliable, high-quality palm oil to use in the production of food, cosmetics and industrial products. As the demand for palm oil is increasing due to its popularity for providing alternative sources of fat, we plan to meet the ever-growing demand for palm oil in the international market, as well as in local markets.
Our ideal customer would most likely be volume purchasers who need a reliable supply of palm oil. They should have an established business with a strong track record of producing quality products, with a great reputation in the industry. Our customers must demonstrate commitment to quality and ethical practices and should have an adequate financial strength to support their procurement.
Our ideal customer archetype for our palm oil business is, primarily, food companies looking to source their palm oil from a dependable and high quality provider, as well as small-scale agricultural businesses looking for reliable and cost-effective palm oil sourcing and processing. These customers should be drawn to our commitment to quality, diversity, and sustainability, as well as our affordable prices, customer service, and transparent business practices.
The potential palm oil market is expected to remain strong due to its popularity and versatility as a natural product. Our business strategy is to capitalize on new opportunities arising from consumer preferences, and to establish a global presence to capture a larger share of the market. To achieve this, we are committed to continuing our research and development initiatives to expand our production capacity and maintain quality standards, while also investing in marketing and promotional campaigns. Additionally, by forging strategic partnerships with local buyers, we will be able to increase our market penetration, and ensure the sustainability of our business in the long-term.
Olive Tree Palm Oil, LLC’s major competitors are current palm oil producers and suppliers. As an up-and-coming sustainable palm oil provider, the company is smaller and less experienced compared to its competition. Below is a table of potential competitors:
As Olive Tree Palm Oil, LLC is based in the same city and state as its competition, the scale of competition is significantly higher than normal. In order to gain a strong foothold in the market, Olive Tree Palm Oil, LLC must differentiate itself from other palm oil suppliers.
IV.- Marketing and Sales Plan
At Olive Tree Palm Oil, LLC, our primary goal is to create a marketing and sales plan that maximizes our reach while remaining cost efficient. To this end, we plan to implement a mix of traditional and digital marketing strategies, to ensure a wide range of customers have access to our sustainable palm oil. We will target local, ethical consumers as well as corporate customers who are interested in reducing their environmental impact. Our cost-effective strategies will include the following:
- Printed advertisements in local newspapers, magazines and online publications.
- Social media campaigns on relevant social media platforms, such as Twitter and Instagram.
- Word of mouth marketing efforts such as sponsoring community events and developing partnerships with local businesses.
- Educational materials and seminars, to promote sustainable palm oil practices and usage.
In addition to the strategies outlined above, we also have plans to increase customer engagement and loyalty by offering discounts and other incentives. Our goal is to ensure customer satisfaction with our products and services, while still remaining cost-effective in our marketing and sales plan.
We anticipate making a sizable number of sales from our palm oil business given the current market conditions, our capacity and our pricing strategy. Considering the current demand for palm oil, our efficient production capabilities and our competitive prices, we expect to generate impressive sales volumes. Our sales volumes will be further increased by a comprehensive marketing and advertising campaign conducted by our team.
Our current market research suggests that our sales numbers could rise steadily to reach a yearly maximum of XXX units. We base these estimates on our current production setup, the retail and wholesale channels we intend to use and our competitive pricing strategy.
Location and Facilities
Olive Tree Palm Oil, LLC is located in Portland, Oregon, where we have family-owned farms with direct access to the local palm oil we use in our products. Our physical presence in Portland provides us with a cost-effective operation, while our farms provide us with access to high-quality local oil. We have established our facility and are ready to provide our customers with the highest quality sustainable palm oil products.
Our facility includes state-of-the-art equipment for refining and packaging our products. We are also able to offer educational materials and assistance in finding the best sustainable palm oil suppliers in the area. Our space is conveniently located and allows us to serve our customers quickly and effectively.
Our palm oil business plan takes advantage of the latest technological advances to make sure that our clients' investments are well-protected, optimally managed and profitable. With proprietary software specifically designed for the palm oil industry, we are able to track the entire process from planting to harvesting and even distribution and sale. This allows us to create an efficient and accurate supply chain system, ensuring each individual output is maximized for maximum returns. Additionally, our monitoring systems enable predictive analytics to give a better understanding of how market changes may affect our margins, allowing customization of products and strategies when needed.
Equipment and Tools
To successfully operate a palm oil business, we will need to be equipped with the proper tools and equipment. Our required equipment and tools consists of an extraction machine, refining machine, storage tanks for finished product, containers for raw material, and other necessary machinery. We will need to purchase or rent the necessary equipment and consider the associated costs.
The following table outlines the cost associated with purchasing or renting the equipment:
V.- Management and Organization
Our organization will be comprised of a CEO, CFO, and Operations Director who together will report to the Board of Directors. Below is an overview of the structure including roles and responsibilites.
The flow of information between the different levels of the organization will be established through frequent communication, regular reporting and performance review sessions. This will help ensure that all members of the organization have access to the same information and can make decisions in order to move the business forward.
In order to succeed, PalmOil Business will require experienced professionals in every level of our organizational hierarchy, from top to bottom. We anticipate need to recruit a skilled management team consisting of leadership, sales, operations and finance professionals. The following table outlines the potential candidates we are considering for high-level roles within the company:
Management Team Gaps
At this point in time, our palm oil business plan does not have individuals or candidates ready to fill certain positions or areas of expertise. We recognize the need to dedicate resources towards identifying and training team members who will take over these roles in the future.
We are currently lacking in specific skills related to the marketing and financial aspects of our business. Additionally, we need to identify personnel that possess expertise in the relevant areas of procurement and product management.
To run a successful palm oil business, a specific personnel plan must be implemented to ensure the most efficient use of resources. To that end, a table of potential positions required in order to effectively manage and operate the business can be found below:
Company History and Ownership
Olive Tree Palm Oil, LLC was founded in 2021 by Michael and Jessica Johnson, two Portland-area entrepreneurs with a strong background in sustainability and business. The Johnson family saw the need for an alternative palm oil source for customers, as most major brands use unsustainable palm oil sources. The mission of Olive Tree Palm Oil is to provide a safe, quality, and sustainable alternative to traditional palm oil.
The company is owned by Michael and Jessica Johnson and their two adult children, Emily and Jake. They each have equal ownership of the company and maintain a collaborative approach to business decision-making. They are committed to promoting sustainability from both an environmental and an ethical perspective, and are interested in educating their customers about sustainable palm oil practices.
A detailed roadmap of specific goals and objectives can help us manage and steer our palm oil business. We have created a table below outlining our major milestones and targets for the next 12 months.
Key performance indicators (KPIs) are metrics used to measure and track the performance of various aspects of a palm oil business. These metrics help businesses to assess their overall performance and health, as well as to identify areas of opportunity. Examples of KPIs to measure the performance and health of a palm oil business include gross profit margin, customer satisfaction, production efficiency and effectiveness, inventory turns, and market share. By tracking these and other KPIs, businesses can better understand the functioning of their operations and the impact of their decisions on their overall performance.
VI.- Financial Plan and Metrics
A sales forecast is a crucial element of any business plan. It serves to document expected sales performance and provide guidance on necessary budget allocations. Our palm oil business plan includes a three-year sales forecast. Our projected sales are provided in the table below.
Palm Oil Financial Plan Key Inputs
Starting or running any business requires the investement of money. The palm oil business is no different. Additionally, a well formulated business plan should include information on not just income and profits but also expenses. These expenses are bound to fall into two categories: startup costs and operational expenses.
This part of the business plan is where you present the three main financial documents of any startup: the income statement, the cash flow statement, and the balance sheet. These documents provide an overview of the financial activity of the business by providing detailed information on revenue and expenses, cash flow management and asset and liability balances. With these documents, investors can get a comprehensive view of your business plan.
Palm Oil Financial Plan Profit & Loss Statement
Palm Oil Financial Plan Cash Flow Statement
Palm Oil Financial Plan Balance Sheet Statement
The personnel plan for our palm oil business outlines who and how we intend to hire and what the respective remunerations and roles will be in the business operations. We will be hiring experienced and capable personnel who are knowledgeable about the palm oil business. Our hiring efforts will involve recruiting personnel through job postings, networking, and local outreach programs. Additionally, we plan to cultivate relationships with educational institutions to strengthen our recruiting efforts.
The payment structure for our personnel will depend on the hiring role and experience level. While the exact remuneration packages will be based on individual negotiation, they will all remain within the market rate. Furthermore, all personnel will have access to medical and retirement benefits. In terms of roles, our personnel will take on various responsibilities such as managing operations and production, maintaining proper safety and quality standards, developing strategies, and creating promotional material.
Finally, all personnel hired will fit into each of our business operations by having a comprehensive understanding of the palm oil industry and being willing to work together with other personnel in the business. The integration of personnel into the business will be done in a streamlined and efficient manner, with attention to detail and a commitment to delivering excellence in our products and services.
Capital Requirements and Use of Funds
The capital requirements for our palm oil business plan should reflect our estimated costs for startup and ongoing operations. Crucially, the plan should also contain an outline of how the funds raised will be allocated. We intend to allocate our capital in a way that will ensure maximum return on investment for our investors or lenders.
Our capital will be allocated to the following areas:
- Operational expenses, including personnel, materials and equipment, building and facility expenses;
- Marketing and promotional campaigns;
- Administrative costs;
- Research and development; and
- General capital expenditures.
We believe that ensuring adequate capital allocation across these five categories is essential to the success of our business. We also intend to allocate a portion of our capital to promote sustainable palm oil farming practices and to support the communities surrounding our production facilities.
The exit strategy for our palm oil business plan is focused on finding potential buyers or partners who will be interested in our product and the mission behind our business. We intend to bring in buyers or partners who could help accelerate the growth of the business. Depending on the buyer, our plan may include selling the business, merging with a corporate partner or a private investor, or passing the business along to a family member or an employee.
Our exit strategy also includes establishing a solid network we can rely on for advice and guidance. The exit strategy should also be revisited over time to ensure it remains in line with changes in the industry and the goals of the business.
Very useful tool
PALM OIL PRODUCTION BUSINESS PLAN WITH FINANCIAL ANALYSIS
Looking for a comprehensive palm oil production business plan in Nigeria to kick start your business?
This sample of Palm Oil Production and Processing Business Plan in Nigeria can be used for Grant Applications, NIRSAL, CBN, BOI, BOA, Bank Loans, Proposal writing, Business Concept Note, Competitions etc. Palm Oil Production and Processing Business Plan is a lucrative business that needs a lot of strategic planning to start.
The Palm Oil Processing Business Plan will have these Chapters:
- Executive summary
- Business Description
- Objective and Goals
- Estimated Profit
- Production Strategy
- Cost Estimates
- Our vision statement
- Our mission statement
- Our business structure
- Our strength
- Market analysis
- Market trends
- Our target market for our palm oil production company
- Our competitive advantage
- Sales and marketing strategy
- Sales forecast for our palm oil processing plant
- Payment options
- Financial analysis for our Palm Oil production plant
- Sources of startup capital for our Palm Oil processing company
READ – Download Snail Farming Business Plan Now
1.0. Business Description of Palm Oil Production and Processing Business plan
Business: Palm Oil Production and Processing
Industry: Agriculture (Crop Farming; Palm Oil Production and Processing Business plan in Nigeria)
Farms is an Integrated Palm Oil Production and Processing Farm operating in hygienic and pure production and processing of prepared palm oil targeting Ebonyi state, Southeast Nigeria, the entire nation and ﬁnally the export market. We make sure we always use the best quality raw materials and ensure good cultivation practice throughout our cultivation and processing process. Our palm oil is certiﬁed to meet international standard and are rich in essential vitamins and other mineral nutrients.
The pros of our products and services are:
- Quality, healthy and pure hygienically and painstakingly prepared palm oil produce of international quality.
- Good packaging and intensive cultivation and processing thus ensuring continuous availability of our products.
- Impeccable or close to impeccable Customer Care Services.
- Online purchase and delivery for both our products and training services.
My business meets a need and demand for:
- The supply of pure and high quality prepared palm oil produce.
- The demand for cheaper and locally produced palm oil for the increasing population.
- The demand for increased production and consumption of high quality locally produced unadulterated hygienically prepared palm oil produce.
I am in this business because of my keen interest in palm oil. I also desire to produce this produces at a quantity that will meet local demands. I have also discovered a possible means of establishing a monopoly as I have noticed an unsatisfiable market in my area. I have a great passion for self-reliance and creating job opportunities.
2.0. Our Objectives
- Constant growth in sales in 12 months.
- To generate customer satisfaction
- To provide high quality locally produced pure, hygienically prepared palm oil produce at reasonable prices with exemplary services.
3.0. Our Goal for the Palm Oil Production and Processing Business
- To be a one-stop farm for high quality locally produced pure and hygienically prepared palm oil produce in Nigeria.
- To have trained over 500 trainees in 12 months.
4.0. Our Vision for the Palm Oil Production and Processing Business plan in Nigeria
To supply high quality locally produced, pure and hygienically prepared palm oil produce in Nigeria at an affordable cost.
Our Mission for the Palm Oil Production and Processing Business plan in Nigeria
To surpass the customers’ expectations by providing quality products and services
How To Download The Palm Oil Plantation Business Plan Template PDF and Doc (with financial analysis)
Above is a part of the Palm Oil business plan template in Nigerian. In case you need the complete Palm oil plantation business plan, follow the procedures to download it.
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Thereafter, send us your email address through text message to +234 701 754 2853 . The text must contain the title of the business plan you want and also your email address. Immediately after the confirmation of your payment, we will send the Palm Oil Plantation business plan in Nigeria to your email address where you can easily download it.
How To Start A Palm Oil Processing Business In Nigeria.
The palm oil business in Nigeria is not as complicated as you may assume. I will show you the steps that must be performed in order to begin a lucrative palm oil processing business in Nigeria.
1. Conduct extensive market research This is an intended initial step. It is critical that you first do a thorough market study to assist and guide your marketing approach. It is always preferable to have a ready market than to go seeking buyers once the firm has been established. So remember that. By reading this essay, you have already taken the first step.
2. Find a suitable site for Your Processing Plant. Your ideal site should be convenient for your target market. However, because you will not be selling directly to people, it may be unnecessary for you to be located near a market. In this situation, your optimal site will be near palm oil fields and plantations, or in locations where there are a lot of palm trees. You want your facility to be far away from human and animal activity.
3. Purchasing Palm Oil Processing Equipment In the market for palm oil processing, there are several complex machinery and equipment available. The following equipment is required for the proper operation of your business: • Boiler • Palm fruit stripper • Nut fiber separator • Pounding machine • Mechanical screw press • Barrels/surface tanks I recommend that you obtain a Palm Oil Operation Plan to properly understand the equipment required for your business.
4. Plant installation The following step is to efficiently set up your processing facility and install certain machinery. Typically, you must seek out pros to assist you in constructing the necessary infrastructure as well as setting up and installing it.
At the end of the day, your ability to sell will decide the success of your firm. Every day, look for new ways to reach out to additional customers. While concentrating on networking inside your target market. Approach potential marketers and persuade them to purchase from your firm. Concentrate on efficiently expanding your consumer base and developing repeat customers for your company. When it comes to adopting marketing techniques, you must be proactive. This is your company’s lifeline, therefore treat it as such.
Dr. Abi Demi is a skilled technical writer and author with specialties in the martech and fintech space. Featured on Tekedia, Coin Review, Business Insider, Fintechna, Cryptocoin.news, Date 360 and several other sterling online publications, Demi is an astute technical writer that specializes in finance, marketing and technology - with over 500 published pieces across the internet ecosystem. Contact Abi Demi - [email protected]
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Palm Oil Production Business Plan
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Resources On Palm Oil Production
- Financial Model
- Value Proposition
- One-Page Business Plan
- SWOT Analysis
- Business Model
Products & services, market analysis, marketing plan.
- Management Plan
- Financial Plan
Palm oil is a widely used commodity in the United States, with demand continuing to rise. However, local farmers struggle to meet that demand due to challenges such as low productivity, low yields, and lack of access to quality genetic material and agricultural inputs. On the other hand, palm oil companies have to depend on imports to meet their requirements, resulting in the US being less self-sufficient in palm oil production.
Our business, Palm Harvest, aims to address this problem by using the contract farming model to empower local farmers and provide top-quality palm oil to US companies. Our focus on genetic material, agricultural inputs, and technical advice, along with our long-term partnerships with farmers and companies, will ensure a sustainable and profitable business for all parties involved.
Palm Harvest will be providing a high-quality palm oil solution to the US market through the contract farming business model. The company will be offering products and services to both palm oil companies and local farmers, ensuring a steady supply of high-quality palm oil that is sustainably produced.
Through the direct agreements with local farmers, Palm Harvest will be providing the necessary genetic material, agricultural inputs, and technical advice required to cultivate high-quality palm oil. This not only ensures a consistent supply of palm oil to the market but also enables the farmers to improve their livelihoods by providing them with a guaranteed income.
Our business model solves the problem of ensuring a steady supply of high-quality palm oil to the US market while simultaneously providing farmers with sustainable and reliable income. With a focus on providing value to both our customers and our partners, Palm Harvest is well-positioned to be a successful player in the highly competitive palm oil production industry.
The target market for Palm Harvest includes palm oil companies and local farmers who are interested in contract farming. Palm oil companies require a steady and reliable supply of high-quality palm oil for their production processes. Through our direct agreements with local farmers, we aim to provide a sustainable and profitable source of palm oil for these companies. Our value proposition of guaranteed income and improved livelihoods for farmers also appeals to those who are looking for a more equitable and socially responsible way of doing business.
In addition, we aim to target environmentally conscious consumers who are willing to pay a premium for sustainable and responsibly-sourced palm oil products. This target market is growing as consumers become more aware of the negative impacts of palm oil production on the environment and human rights. By focusing on sustainability and social responsibility, we aim to appeal to these consumers and capture a share of this growing market.
Currently, there are a few alternatives available in the US market, including palm oil imports from countries such as Indonesia and Malaysia. However, there are concerns about the sustainability of the palm oil industry in these countries, including deforestation and the exploitation of workers. Therefore, there is a growing demand for sustainable and ethically-sourced palm oil in the US market.
Palm Harvest aims to provide a sustainable and profitable solution for companies and farmers alike, using the contract farming model to ensure a steady supply of high-quality palm oil. Our key differentiators are our focus on sustainable and ethical practices, our direct agreements with local farmers, and our long-term partnerships with palm oil companies. By offering a solution that meets the demand for sustainable and ethically-sourced palm oil, we believe that we will be able to compete effectively in the market.
The Palm Oil Production Business Plan has been carefully designed to ensure a sustainable and profitable business. Our financial plan covers the costs, sales, and profitability of the business.
Key highlights of our financial plan include:
- We aim to secure $2 million in startup capital through a combination of bank loans, private equity, and angel investments.
- We project a cost structure that is efficient, sustainable, and profitable for both our company and local farmers.
- We plan to generate revenue that will cover the costs of production and operations, with a reasonable return on investment.
- We expect a steady supply of high-quality palm oil from our long-term partnerships with local farmers and palm oil companies.
- We will operate with a high-profit margin, thanks to our contract farming business model that allows us to sell our products at a pre-agreed price higher than the market price.
With our financial plan, we are confident that Palm Harvest will be a successful and profitable business venture, providing high-quality palm oil to the US market while improving the livelihoods of local farmers.
Our funding goal for the Palm Oil Production Business Plan startup is $2 million, which will be raised through a combination of bank loans, private equity, and angel investments. The following is a brief outline of the amount of money needed for the startup:
- $1 million for land acquisition and development
- $500,000 for equipment purchase and installation
- $250,000 for initial staff salaries and benefits
- $150,000 for marketing and branding efforts
- $100,000 for legal and accounting fees
With this funding, Palm Harvest will be able to establish a sustainable and profitable business, providing high-quality palm oil products and services to both palm oil companies and local farmers, while improving their livelihoods through the contract farming business model.
Milestones and Traction
At Palm Harvest, we have set several milestones that we plan to achieve in the coming years. We believe that these milestones will help us achieve our business goals and become a sustainable and profitable business in the palm oil production industry.
These milestones will help us track our progress and ensure that we are on track to achieve our business goals. We plan to continually review and adjust our plans to ensure that we remain competitive in the market and provide high-quality products and services to our customers.
Problem Worth Solving
The palm oil production industry in the US faces a major challenge of securing a steady supply of high-quality palm oil. The prevailing market price for palm oil is often low, resulting in local farmers struggling to make ends meet. Additionally, these farmers may lack access to the necessary genetic material, agricultural inputs, and technical advice required to produce high-quality palm oil crops.
Thus, Palm Harvest aims to solve these key pain points for both the palm oil companies and the local farmers by providing a comprehensive solution. Our contract farming business model will ensure that farmers have access to the required resources and technical support, leading to increased yields and higher quality crops. In turn, this will guarantee the palm oil companies a steady supply of high-quality palm oil at a pre-agreed price, thus avoiding the volatility of the open market.
Validation of problem and solution, product overview.
Palm Harvest will provide high-quality palm oil to the US market using the contract farming business model. Our product is targeted towards palm oil companies and will benefit them by offering a steady supply of high-quality palm oil at a pre-agreed price higher than the prevailing market price. This guarantees a reliable source of the raw material they need for production.
In addition, Palm Harvest will provide farmers with the necessary genetic material, agricultural inputs, and technical advice to ensure the cultivation of high-quality palm trees. This service will enable farmers to increase their yields and improve their livelihoods by generating a guaranteed income through the sale of their produce to Palm Harvest.
Overall, our product and service will benefit both palm oil companies and local farmers by providing a sustainable and profitable business model that generates income for all parties involved.
Currently, there are several palm oil production companies in the US offering similar products and services to our target market. Some of these include XYZ Palm Oil Company and ABC Sustainable Farms. However, our unique approach sets us apart from our competitors.
Unlike other companies that solely rely on large-scale industrial plantations, we will be implementing the contract farming model, which offers several advantages for both palm oil companies and local farmers. Our long-term partnerships with farmers will ensure a steady supply of high-quality palm oil at a pre-agreed price, which is usually higher than the prevailing market price. This approach will create a stable business environment for all parties involved, ensuring sustainable and profitable business growth.
Furthermore, we will not only offer genetic material and agricultural inputs to the farmers but also provide them with technical advice, helping them improve their farming practices and increase their yield. This added support will not only improve their livelihoods but also improve the quality and quantity of the palm oil produced.
Another way our business plan differs from competitors is through our location. Our company will be located in the city of Miami, a strategic location that will enable us to tap into the vast US market, as well as the international market.
Roadmap: Products & Services
At Palm Harvest, we aim to provide the US market with high-quality palm oil using the contract farming business model. Our products and services will be focused on both palm oil companies and local farmers, providing them with genetic material, agricultural inputs, and technical advice to achieve a steady supply of premium quality palm oil.
Our roadmap will include the following steps:
Our roadmap will be updated regularly, ensuring that we remain on track to achieve our business goals and deliver high-quality palm oil to the US market.
The potential market segments of the palm oil production business include large corporations that require a steady supply of palm oil and small-scale farmers who are willing to enter into contract farming agreements. While the size of the palm oil companies segment is medium, the market potential is high due to the steady demand for palm oil. The local farmers segment is large, but the market potential is medium as not all farmers will be willing to enter into these agreements.
Target market segment strategy
Our ideal customers are palm oil companies that require a steady supply of palm oil for their operations, as well as local farmers who often face uncertainties in securing a fair price for their produce. By entering into direct agreements with these farmers, we aim to provide them with a guaranteed income and improve their livelihoods, while ensuring a consistent supply of high-quality palm oil for our clients. Our target market strategy is to build long-term partnerships with these customers, based on mutual benefits and shared values of sustainability and responsible production.
Our ideal customer archetype will be palm oil companies looking for a reliable and sustainable source of palm oil, as well as local farmers who want to improve their livelihoods and have a guaranteed income. These customers will be our main advocates as we work together to create a mutually beneficial partnership. We aim to establish long-term relationships with our customers, built on trust and transparency, as we work towards our shared goal of sustainable and profitable palm oil production.
Based on the analysis of the potential customer segments, our contract farming model for palm oil production has a promising future market. By offering a steady supply of palm oil to companies through partnerships with local farmers, we can ensure a reliable source of revenue for our business as well as improve the livelihoods of farmers.
Furthermore, as consumer demand for sustainable and ethically sourced products continues to grow, our commitment to fair trade practices and responsible production methods will help us tap into this expanding market. By offering a product with a positive social and environmental impact, we believe we can capture a loyal customer base and grow our business in the future.
Our market analysis has identified several potential competitors in the palm oil production industry:
Despite the presence of these competitors, our contract farming model offers a unique value proposition to both palm oil companies and local farmers, providing a steady supply of high-quality palm oil and improving the livelihoods of small-scale farmers.
Marketing and Sales Plan
Our marketing and advertising strategy will focus on building long-term partnerships with palm oil companies and local farmers. We will reach out to these potential customers through direct mail, email marketing, and personal visits to their locations. Our goal is to establish ourselves as a reliable and trusted partner for palm oil production.
The costs associated with our marketing efforts will be primarily focused on travel expenses and marketing materials. Our total projected marketing budget for the first year is $50,000.
We anticipate strong demand for our high-quality palm oil products from both palm oil companies and individual consumers. Our pricing strategy will be to sell our palm oil at a pre-agreed price that is higher than the market price, ensuring that our company and farmers receive a fair return on investment. We will also offer value-added services such as customized packaging and logistics support to attract customers.
Based on market conditions and our production capacity, we expect to sell approximately 1,000 metric tons of palm oil in the first year of operation, with sales increasing to 5,000 metric tons by the fifth year. Our sales projections are conservative, taking into account potential challenges such as fluctuations in demand and supply chain disruptions. We will continuously monitor market trends and adjust our sales strategy accordingly to ensure that we meet our revenue targets and remain competitive in the marketplace.
Location and Facilities
Palm Harvest will be operating in the city of Miami, Florida, a strategic location that allows us to tap into the growing demand for sustainable palm oil in the US market. We have identified an ideal location in the outskirts of the city that provides ample space for the cultivation of palm trees and easy access to major transport networks.
The costs of operation include land lease fees, utilities, and transportation costs for the palm oil. We have done extensive research and have identified cost-effective suppliers for all necessary inputs, such as fertilizers, seedlings, and other agricultural inputs. Our location and facilities are designed to optimize efficiency, reduce waste, and improve the quality of our palm oil products.
Equipment and Tools
For successful palm oil production, we will need the following equipment and tools:
We will use a combination of purchasing and renting equipment and tools, depending on the specific needs of the farm. We will also explore financing options for some of these costs in order to manage our cash flow effectively.
In marketing and sales, we will highlight our investment in high-quality equipment and tools, as well as our focus on sustainable and ethical production practices. By doing so, we aim to attract customers who are interested in supporting responsible and environmentally friendly palm oil production.
Management and Organization
Our Palm Oil Production Business Plan has a simple and effective organizational structure. It consists of three levels, each with specific roles and responsibilities. The upper level is the management team that oversees all operations, from strategizing to decision-making. The middle level consists of supervisors who manage the daily operations and are responsible for ensuring that the goals set by the management team are achieved. The lower level is comprised of the farmers who cultivate the palm trees.
We maintain a fluid information flow between the levels to ensure that everyone is well-informed and can make well-informed decisions. The CEO communicates with the supervisors who, in turn, relay the information to the farmers. This ensures that everyone is playing their role effectively and the business runs smoothly.
Management team gaps.
At present, our management team lacks expertise in the areas of sustainable palm oil production and supply chain management. We are actively seeking experienced professionals to fill these roles and ensure that our business practices align with industry best practices and environmental standards. Additionally, we plan to hire a dedicated human resources professional to manage our relationships with local farmers and ensure that they are provided with adequate support and resources to cultivate their palm trees effectively.
Running a successful Palm Oil Production business requires a team of skilled personnel to manage various activities from cultivation of palm trees to managing farmer relationships. The following table shows the potential positions and their respective roles in the business.
Company History and Ownership
Palm Harvest is a young and vibrant company that is poised to leverage on the lucrative palm oil production business in the US. The idea for the company came from a team of experienced business consultants who were passionate about using their skills to make a positive impact. Their extensive research on the palm oil industry in the US revealed a gap that provided an opportunity for a sustainable and profitable business that will generate income for the company and farmers alike.
Palm Harvest is fully owned by its founders, who have pooled together their resources and expertise to create a company that will be competitive in the palm oil production industry. As top-tier business consultants with experience in business development, finance, and economics, the founders are well equipped to navigate the challenges in the industry and achieve their financial goals.
The company has a lean management structure, with the founders taking on key roles in strategy, operations, and finance. They will be supported by a team of experienced professionals in the fields of agriculture, marketing, and supply chain management, who will ensure that the company's operations run efficiently and sustainably. The team is committed to the success of the company and the improvement of the livelihoods of local farmers.
As a part of the management and organization plan, Palm Harvest has created a detailed roadmap in HTML table format to achieve specific goals and objectives that will steer the business to success.
Effective monitoring of key performance indicators (KPIs) is crucial for the success of any business. For our palm oil production business, we will track the following metrics to gauge the overall performance and health of the company:
- Total revenue generated from sales of palm oil
- Growth in the number of farmer partnerships and palm tree cultivation
- Cost of genetic material, agricultural inputs, technical advice, and management of farmer relationships
- Percentage increase in farmer income and improvement in livelihoods
- Customer satisfaction level based on feedback and reviews
By closely monitoring these KPIs, we will be able to identify areas that require improvement, take corrective action, and continuously strive towards achieving our business objectives.
Financial Plan and Metrics
Below is the projected sales for the three years (2023, 2024, 2025) broken down by product categories:
Our sales forecast is based on our projected production levels and our expected prices per product category. We anticipate a steady growth in demand for palm oil in the US market, which will allow us to increase our sales year over year.
Projected Profit and Loss
Our financial plan shows a steady growth in revenue and profits over the three-year period, with a focus on maintaining sustainable and profitable operations. The profit and loss statement, presented in the table below, reflects the expected financial outcomes for each year.
As shown, we expect to generate $2.5 million in revenue in 2023, with a gross margin of $1 million and a 40% gross margin percentage. Our expenses for the year are projected to be $600,000, resulting in a net profit of $400,000 and a 16% profit percentage.
Over the next two years, we anticipate significant growth in revenue and profits due to increased demand for our products and services. By 2025, we forecast revenue of $5.5 million, with a gross margin of $2.2 million and a 40% gross margin percentage. Our expenses are estimated at $1 million, resulting in a net profit of $1.2 million and a 22% profit percentage.
Overall, we are confident that our financial plan will enable us to achieve our goal of creating a sustainable and profitable palm oil production business while improving the livelihoods of local farmers.
Projected Cash Flow
Our financial plan for Palm Harvest includes building a projected cash flow statement for the first three years of operations (2023-2025).
Our projected cash flow shows that we expect to have positive net cash flow in all three years, with increasing revenue from sales and careful cost management. These funds will be used to grow the business, expand our product lines, and invest in new technology.
Projected Balance Sheet
Below is a table showing the projected balance sheet for the Palm Oil Production Business Plan for the years 2023, 2024, and 2025. The categories included are Assets, Liabilities, and Equity.
As shown in the table, we anticipate a steady growth in our assets, liabilities, and equity over the three years. We are committed to managing our finances effectively and ensuring our liabilities are minimized while our assets and equity grow, to maximize our profitability.
Our personnel plan involves hiring local experts in agriculture and palm oil production, as well as skilled workers in the field. We will also train local farmers to cultivate palm trees and manage their farms sustainably.
We will offer competitive compensation packages that include salary, benefits, and bonuses based on performance. Our employees will be an integral part of our business operations, playing a key role in ensuring the quality and sustainability of our palm oil production.
Use of Funds
Below is an HTML table detailing how the startup capital of $2 million will be utilized for the Palm Oil Production Business Plan:
The funds will be used to cover the costs of production, operations, working capital, and marketing activities. By utilizing these funds, Palm Harvest will be able to establish itself as a competitive player in the palm oil production industry.
Our eventual exit strategy for this business is to focus on growth and expansion while building a strong brand reputation. Our long-term goal is to become a preferred partner for palm oil companies, leading to acquisition or buyout offers. We will also explore the option of a public offering or selling the business to a family member or key employee who shares our vision and values.
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Palm Kernel Oil Business Plan [Sample Template]
By: Author Tony Martins Ajaero
Home » Business Plans » Agriculture Sector » Agro Processing
Are you about starting a palm kernel oil production business? If YES, here is a complete sample palm kernel oil production business plan template & feasibility report you can use for FREE .
Okay, so we have considered all the requirements for starting a palm kernel oil production business. We also took it further by analyzing and drafting a sample palm kernel oil marketing plan template backed up by actionable guerrilla marketing ideas for palm kernel oil production businesses.
So let’s proceed to the business planning section. Palm kernel oil is usually derived from pressing and extracting the oil from the palm kernel nuts through a press machine and then refined by a refining machine. After pressing, the palm kernel oil in its crude state becomes solid with a taste and smell, however, after refining, it turns into oil with a whitish or yellowish color and a neutral taste.
Palm kernel oil is vital for the production of many products such as soaps, chocolates, chewing gum, washing powder, lipsticks, margarine, coating, ice cream, noodles and bio-diesel. It is also widely used for cooking by some people and is not only cheaper than vegetable oils buts also has a higher saturated fat content which allows for a better and longer shelf life.
This is not just a newly discovered business but has existed for a long time, and is a real money spinner to entrepreneurs who are in it.
The market for this business is not only steady but it is a market that can never be saturated as there are no close substitutes to its use in many of the products that it is widely used in. if you intend going into the business, then you would need a business plan.
Below is a sample palm kernel oil production business plan;
A Sample Palm Kernel Oil Production Business Plan Template
1. industry overview.
The palm oil fruit is one of the most important fruit crop globally because the benefits that is gotten from all parts of the tree, from the palm fronds, to the palm oil extracted from the fruits and the palm kernel oil extracted from the palm nuts.
There are two forms of palm kernel oil extraction; mechanical and traditional. While mechanical is easier but requires more machines, the traditional method is more labor consuming but requires fewer machines.
The demand for palm kernel oil has increased globally as more than 54 million tons were produced in 2011. The demand is due to the cheap nature of the oil for those who use it to cook, as it is a close substitute to vegetable oil, and has higher saturated fat that is close to the amount contained in coconut oil.
The demand is also spiked by those who manufacture cosmetics, candles, detergents, as well as food products due to its properties which make it very versatile in the industry, especially as it has a high melting point.
Globally, Malaysia is the highest producer of palm oil and is responsible for 44% of world exports. Malaysia started refining its crude palm oil in the early 70s which came about as a resolve of the country’s government to increase industrialization. Palm oil fruits mainly grow in countries that have rainforests such as Asian countries and African countries.
As at 2013, 55 million metric tons of palm oil was consumed globally, this was nearly four times of what was consumed two decades back. Asides Malaysia, Indonesia is the second highest producer of palm oil. The two countries meet 85% of global demand.
The increase in the demand for tropical oils in the united states started when in 2006, when the United States Food and Drug Administration, mandated that food labels listed Trans fats.
Trans fats was regarded as a major cause of heart disease and as such manufacturers especially those in the food industry started moving towards the use of palm oil and palm kernel oil in its products, especially as the benefits of the oil to the heart and brain were expounded by a renowned doctor.
There however have been setbacks for this business as more health conscious organizations are advocating for the boycott of palm oil and its by-products and advocating instead for the use of organic palm oil in products especially consumable products.
This is due to the fact that palm oil producers in a bid to make profit are not transparent, do not observe strict environmental standards and practice unfair labor policies. Also, oil palm plantations is said to be gradually destroying the rain forest and the different species found there.
There are some consequences to producing oil palms which are deforestation and habitat destruction, but this has however not made the few replaceable alternatives attractive enough for most of the food and industrial manufacturers, as even the alternatives will lead to more destruction to the forests and climates.
Also, the alternatives do not have a sustainable nature like the palm kernel oil and might not be able to meet the growing global demand.
Several companies have begun to take the warnings of environmentalists seriously by changing to sustainable palm kernel oil which use ingredients that have sustainable sources such as certifiable sustainable palm and palm kernel oil. Others have started using segregated or mass balanced palm kernel oil.
2. Executive Summary
Henai Palm Kernel Oil Inc is one of the foremost leading palm kernel oil extraction companies in Brickell Avenue, Miami, USA that caters to mostly domestic, commercial and industrial clients. We deal in the extraction of palm kernel oil from crushed palm kernel nuts into a crude or refined state depending on the requirement of our numerous clients.
We also sell the by- products gotten after extracting and refining the crude oil, while also offering consultancy services to start-ups who want to venture into the palm kernel oil extraction business as well as for research purposes.
Our aim of establishing this business is to favorably compete with other palm kernel oil extracting companies both in Miami and in the United States as a whole.
One of our major corporate goals is to be a renowned brand known for transparency and good work ethics, this we can do by crafting a sound corporate culture for the company and also recruiting and giving out continuous training to the best professionals in the industry who not only believe in our vision but would also project the image of the company positively through their interactions with our numerous existing and potential customers.
Our extraction machines are intended to be one of the best as we have procured the best crushing, extraction, and refining machines available.
We also have processes and structures in place so as to be able to extract our palm kernel oils under the best standards possible. Our packaging methods will be done with the hygiene of our customers in mind, as there are plans in place to ensure that we become the best there is.
Henai Palm Kernel Oil Inc intends to set a standard when it comes to how palm kernel oil will be produced not only in Miami but also throughout the United States as well.
We intend to not only recruit the best hands possible but to also ensure that they always undergo continuous trainings so as to achieve productivity efficiently. We also intend to engage our stakeholders so that they could participate in the growth of the business.
After a thorough research into the market, we have found that the demand for palm kernel oil both for home, commercial and industrial purposes will continue to increase as the year progresses. Due to this vital information, there are plans in place to ensure that we maintain the best distribution network that will ensure that all our products can reach our numerous clients.
To allay the concerns of environmentalists and provide our own quota towards preserving the rain forests, we at Henai Palm Kernel Oil Inc. intend to ensure that we integrate business practices that are of a high and sustainable standard wherever possible.
We seriously intend to consider switching to sustainable palm kernel oil which use ingredients that have sustainable sources such as certifiable sustainable palm and palm kernel oil in the nearest future.
At Henai Palm Kernel Oil Inc, we intend to ensure that our palm kernels are sourced from trusted and reliable vendors who also engage in the best practices possible. Sourcing from reliable vendors will allow us to be able to continue with our sustainable approach.
Henai Palm Kernel Oil Inc. is established and owned by one of the topmost entrepreneurs in Miami, Mr. Sam Jack. Sam Jack has a B.Sc in Food Science Technology and a Masters Degree in Business Administration from a prestigious school.
He has received several entrepreneurial awards and not only has the required experience to run this business but to also hire the right professionals who will help run the business.
3. Our Products and Services
Henai Palm Kernel Oil Inc. deals in the extraction of palm kernel oil from palm kernel nuts. We are established to cater largely to commercial and industrial clients via our production plant.
We are established to make profit legally as permitted by the laws of the United States; however we also believe in creating multiple sources of income and as a result, we intend to sell the by-products gotten after extracting and refining the palm kernel oil.
Listed below are some of our products and services;
- Refined Palm Kernel Oil (PKO)
- Crude Palm Kernel Oil (CPKO)
- Palm Kernel cake for animal feed production
- Palm kernel sludge
- Crushed palm kernel shell for bio-fuel
- Consultancy services
4. Our Mission and Vision Statement
- Our vision is to be a renowned palm kernel oil producing company and be known not just in Miami but globally as well.
- Our mission is to ensure that we build a palm kernel oil production company that meets with best practice internationally while also meeting with the demands from our existing and potential customers not only in Miami but in the United States as well.
Our Business Structure
One of the major plans we intend to achieve in building our palm kernel oil production company is to ensure that we recruit the right people for the right position. Also, we intend that those we recruit get in tune with our vision, goals and objectives and successfully apply that in relating with our clients.
Getting the best hands is not only necessary for the now, but also for future growth and expansion. We want the people who will be able to help us grow and also sustain the growth we have achieved by constantly moving the company at a steady space.
This cannot be achieved however, if we don’t also invest in training them and also ensure that they have the best welfare possible.
Due to the fact that we intend to sell other products in addition to our main product – palm kernel oil, as well as provide other services as well. We also intend to ensure that the right hands able to handle the refining and sale of these different products effectively.
Below id the business structure for Henai Palm Kernel Oil Inc;
- Chief Executive Officer
- Plant Manager
- Production Floor Supervisor
- Human Resources and Admin Manager
- Marketing Executives
- Truck Drivers
- Customer Care Executives
- Maintenance Team
- Security Guard
5. Job Roles and Responsibilities
Chief Executive Officer (CEO):
- Formulates policies for Henai Palm Kernel Oil Inc.
- Oversees all the operations and departments of the company
- Communicates the company’s culture and value to the management staff
- Responsible for high negotiation deals with clients and investors
- Works closely with production floor supervisor to ensure the successful day-to-day operation of the facility
- Responsible for all the manufacturing personnel hired and coordinates their training
- Monitors production expenses and seeks for ways to reduce cost without reducing quality
- Responsible for developing and ensuring that the plant manufacturing budgets are executed
- Works with the purchasing manager to ensure that purchase orders are created and placed
Production Floor Supervisor:
- Responsible for decision on resources requirement
- Responsible for maintenance of equipment
- Monitors the production processes and adjusts schedules accordingly
- Responsible for ensuring that production is cost effective
- Responsible for drafting a timescale for each task
- Responsible for drafting and executing purchasing strategies
- Responsible for seeking reliable vendors and suppliers
- Responsible for monitoring and also predicting demand levels
- Determines delivery quantity and timing
Human Resources and Admin Manager:
- Responsible for communicating policies regarding employee benefits, compensation as well as employment opportunities to staff
- Responsible for recruiting, hiring and giving orientation to employees so as to ensure they align with company’s goals
- Carries out performance appraisal of employees within the organization to ensure that adequate compensation packages are allotted
- Prepares the budget for the human resources and admin department
- Works directly with the Chief Executive Officer
- Responsible for the preparation of profit and loss statements on behalf of Henai Palm Kernel Oil Inc.
- Ensures that the company accounts as well as its tax returns are not only prepared on time but filed accurately
- Helps in ensuring that budgets are produced and implemented
- Critically analyze the budget as well as other financial information and give advice on where savings could be applied
- Works hand in hand with the Chief Executive Officer
- Responsible for contributing to, drafting marketing strategies and reviewing them whenever possible
- Responsible for the maintenance and up-to-date records of customer databases
- Evaluates marketing campaigns and managing the marketing budget
- Manages the production of marketing materials and ensuring its effective distribution
- Manages existing customer relationships and continually communicating with target audiences to source for potential customers
Customer Care Executives:
- Ensures that they are familiar with the company’s products and services and the benefits of each to the customer
- Responsible for order processing, and satisfaction of customer needs in a satisfactory and professional manner
- Takes orders, resolves complaints, provide information and answers inquiries from clients
- Keeps accurate records of company’s customers in such a way that it can be easily retrieved when necessary
- Develop and constantly review plans and strategies for customer support
- The maintenance team must ensure that the machineries are all performing efficiently and effectively
- Responsible for carrying out corrective maintenance on machineries
- Monitors new technologies and machineries
- Arranges for replacements of needed parts
- Keeps plant manager and floor supervisor informed of defects and or progress
- Ensures that driving activities logbook is maintained so as to show compliance with federal regulations
- Responsible for keeping record of vehicle inspections
- Ensures that truck is equipped with standard safety equipment
- Supervise the loading and unloading of cargo
- Ensure that the route is planned in accordance with delivery schedule
- Protects the facilities of Henai Palm Kernel Oil Inc. and also its staff by ensuring that the environment is safe and secure
- Takes note of unusual occurrences and take prompt lawful action as required
- Ensures that the entry and exit access of the facility are adequately monitored and controlled
- Takes random or regular patrols around the buildings or its perimeter
- Responsible for monitoring surveillance equipment
6. SWOT Analysis
Becoming a renowned business means striving and attaining excellence. Our desire for excellence cannot be disputed and it is due to this that we have with the help of our hired business consultant gone through our proposed business structure and concept to critically evaluate the business which we have intended to go into.
Our evaluation was done to determine if the business was a worthwhile venture that required all the desired investment and resources that were needed.
The evaluation clearly allowed us see our strengths and how we can use it to our advantage; our weaknesses and how we can turn them to strengths; the opportunities which avail themselves to us; and the threats likely to be faced during the course of running the business. Below is what was revealed from the critical evaluation carried out on Henai Palm Kernel Oil Inc.
Our strength stems from the fact that we are not focusing on the sale of refined palm kernel oil alone but also in the sale of its by-products as well. Also, our location is convenient for our target market as there are good road networks into and out of our facilities.
Another factor is our large machineries which are built to withstand the numerous demands that might triple at certain points in time. Also, our competent workforces who have aligned themselves with the vision, goals and objectives of our company are the finest professionals in the industry.
Even though this market is not regarded as a saturated one, we might not effectively be able to compete against already established palm kernel oil production companies in Miami especially those located close to us. However, our marketing strategies have been carefully drafted to be able to overcome this weakness.
The opportunities that abound in this market are unlimited as almost everyone consume or use products that have palm kernel oil in it on a daily basis. This also means there will be more innovative entrepreneurs willing to enter the market and explore the money making opportunities that abound there. Our consultancy services have us already poised to take advantage of this market.
Every business is faced with threats either during start up or during the course of running the business, and our business is no different. We will be faced with threats from environmentalists, unfavorable government policies, as well as stiff competition from our competitors.
7. MARKET ANALYSIS
- Market Trends
The market trend for the palm kernel oil is one of continuous demand, especially as there is a huge population growth that uses all the products which make use of palm kernel oil in its manufacture. While there are few substitutes available to replace this oil, they cannot meet the continuous increase in demand for palm kernel oil in many years to come.
Another trend is in ensuring that we stay above competition by ensuring that we always go the extra mile in factors such as conducive facility and environment, and a competent workforce. This will ensure that our customers have the confidence in our practices and our ability to deliver satisfactory products.
Finally, we can ensure that we are in as many strategic locations as possible, as this will allow us create a very loyal client base. Also, asides being physically close to our customers, we intend to use the internet to achieve the same closeness, by always informing them of the availability of our products.
8. Our Target Market
From available research, we know that there is a wide range of customers available. This means that our target market isn’t just limited to just a certain group of people but cuts across everyone since it is used in almost all products being used by people.
This has enabled us to effectively map out strategic locations all around Miami so that we can effectively be positioned to serve all our numerous clients.
Due to reliable facts and statistics, in addition to a professional market research by our hired business consultant, the right strategies have been effectively drafted for our target market. Our target market is only limited to those with which we would be engaging in wholesale distribution with;
- Soap Manufacturers (small, medium and large scale organizations)
- Cosmetic industries
- Food industries
- Animal feed industries
- Bio-diesel industrial plants
Our Competitive Advantage
Our intention to become one of the most renowned palm kernel oil making businesses in Miami as well as in the United States of America in a few years time means we need to draft strategies that will allow us have a competitive advantage over our counterparts in the agro processing industry.
Our first competitive advantage is in ensuring that we provide the best customer services to our numerous customers. This we can do by employing the most competent professionals who will ensure that our customers’ inquires are answered in a timely manner, and that complaints are handled as quickly as possible.
We also intend to ensure that we pick the right management team that will align with the vision of the Chief Executive Office and in like manner coordinate the lower end staff in such a way that the goals and objectives of the company is achieved.
Providing a conducive working environment for our employees is a must as we would like them to be able to work in an environment that would enhance their productivity and efficiency whilst ensuring that they grow their careers as well.
Finally, in order to have a competitive advantage over our competitors, we would like to ensure that our website is well optimized for search engines and that the website itself is interactive for our clients.
9. SALES AND MARKETING STRATEGY
- Sources of Income
Henai Palm Kernel Oil Inc. is a business that is established with the aim of making profit both in Miami and the United States of America. Our intention of making profit will come from our sales of different products and services to our wide range of customers.
Henai Palm Kernel Oil Inc. will therefore generate income from the sale of the following products;
10. Sales Forecast
Carrying out the right sales forecast is very necessary for the growth of any business as it would enable us make the necessary right predictions for our palm kernel oil sales.
Our sales forecast have shown that we are favorably positioned to not only become a leading brand in Miami but also in the whole of the United States as a whole. Also, the forecast have shown that our palm kernel oil production business is going to be profitable in its first year of business.
Our sales forecast were based on several researches carried out by our hired business consultant based on our strengths and the opportunities we are presenting to the industry as a whole. Our sales forecast were not carried out in isolation, as palm kernel oil start-ups, especially those in Miami were considered.
Below are the sales projections for Henai Palm Kernel Oil Inc. based entirely on our location, the agro processing market as well as the industry as a whole.
- First Fiscal Year-: $600,000
- Second Fiscal Year-: $1,800,000
- Third Fiscal Year-: $3,500,000
N.B : The above projections are based on certain conditions that are static for now and could either change positively or negatively at any given point in time.
- Marketing Strategy and Sales Strategy
The aspect of marketing is one of the most important strategies that is usually drafted during the course of starting any business; this is because marketing serves a dual purpose, such as revenue generation as well as increased publicity for the business. It is of essence that marketing strategies are constantly reviewed and fine tuned so as to attain the best possible strategies for use.
Marketing these days make use of different methods to achieve the aim of attracting more customers to a business. Technology for instance, has come to play a huge role in marketing as people can use the internet to search for our website to either place orders, make inquiries or check out our products and services. This means that any marketing team must put the internet into consideration when drafting marketing strategies.
Due to the overwhelming nature of marketing, we hired experts who have a great understanding of the market as well as the industry at large to collaborate with our marketing team in ensuring that we have the best strategies to capture a large percentage of the market that can be used to generate revenue for our company.
Our marketing team has been empowered via our goals and objectives to deliver the corporate sales of the company through the sale of our products and services. Henai Palm Kernel Oil Inc. intends to adopt the following marketing approach as regards the sale of our palm kernel oil and its related products;
- Introduce Henai Palm Kernel Oil Inc. to commercial and industrial businesses and plants here in Miami by visiting their facilities and meeting with the management
- Launch a unique grand opening that will create awareness in the public regarding our company
- Advertise our various products and services in newspapers (local and national), and on radio and television stations
- Engage in direct marketing
- Ensure that Henai Palm Kernel Oil Inc. is listed in relevant directories and yellow pages
- Use our website to vigorously promote our products and services
- Place our billboard strategically in conspicuous places around Miami
11. Publicity and Advertising Strategy
A company might be doing the right things but without publicity, most of its activities are likely to go unnoticed. No matter how long a company has been established, there is the need for it to engage in continuous publicity. At Henai Palm Kernel Oil Inc., we intend to explore all means of publicity in order to increase public awareness of our company.
In generating publicity, we intend to use all available means both conventional and unconventional in order for people to know about our main product, palm kernel oil and its by-products as well as several other services we might be engaged in. we intend for the publicity to boost our awareness not only in Miami but also in the whole of the United States of America as well.
Below are several of the platforms we intend to use in achieving our aim of publicity for our products and invariably Henai Palm Kernel Oil Inc.;
- Participate in community programs to raise awareness of the benefits of palm kernel oil
- Support the preservation of rain forests by participating against illegal felling of trees as well as destruction for homes for oil palm plantations
- Use our official website to increase awareness about our efforts in donation causes
- Place adverts on newspapers, radio and on television
- Use our social media platforms such as Facebook, Twitter, and LinkedIn to engage the audience with informative articles.
- Network with other palm kernel oil producers as well as palm oil plantation owners who engage in standard practices.
- Make use of attractive looking billboards and then placing them in strategic locations
12. Our Pricing Strategy
Setting the right price is a very important component of any business, as this will determine how the business will fare, and if it will grow or regress. When it comes to the prices to be set for our palm kernel oil and its allied products, we intend to check what rates our competitors are using and then averagely use the same rate. This means we might not need to carry out extensive researches looking for strategies that would enable us set the right price.
Even though we will continuously seek out ways we can give our customers the right pricing; we however, will not choose a price that will hurt our overheads or one that will be below our cost of running operations. We however might choose to run on low profit margins during our first three months of business, as a way of encouraging clients to patronize us.
- Payment Options
We know our customers abhor payment options that are stringent in nature. Knowing how important clients are and how it is essential that they are satisfied with our services, we have plans for different payment options that will suit all our different classes of clients.
Our available payment options are listed below;
- Payment via banks
- Payment via online bank transfer
- Payment via checks
- Payment via bank draft
The above payment platforms were carefully chosen in conjunction with our bank which has the best platform that will ensure our customers have the best experience possible.
13. Startup Expenditure (Budget)
Starting a palm kernel oil production company is capital consuming as the bulk of the capital is used to purchase the required machines that will allow for a smooth production. Asides purchasing machineries and the truck needed to transport these items to various places, the capital is also used to pay employees salaries, utility bills and stock for at least a specified period of time.
The major areas where we intend to spend our start-up capital include;
- Incorporation and other legal fees – $1,000
- Obtaining of licenses and permits – $750
- Operational cost for the first 6 months (which includes employees salaries and utilities bills) – $200,000
- Insurance (general liability, workers’ compensation, and equipment insurance) – $3,000
- Cost of palm kernel oil machines (shell breaking machine, separating machines, pressing machines and refining machines) – $70,000
- Purchase of truck for palm kernel oil distribution – $50,000
- Raw materials (palm kernel nuts) and packaging materials – $20,000
- Marketing budget and promotion expenses for the launching of Henai Palm Kernel Oil Inc. as well as for a running period of six months – $10,000
- Cost of hiring business consultant – $3,000
- Other start-up expenses (stationery, computer, printer, phones, furniture) – $10,000
- Storage equipment (shelves, bins, racks) – $11,000
- Cost of launching an official website – $800
- Cost of factory launch – $5,000
- Miscellaneous – $15,000
From the above estimate, we would need the amount of $400,000 in order to successfully set up our palm kernel oil company in Brickell Avenue, Miami.
Generating Funding/Startup Capital for Henai Palm Kernel Oil Production Business
Henai Palm Kernel Oil Inc. is a business that is owned and operated by Mr. Sam Jack. Mr. Sam is willing to allow external investors who have the same vision to have a little stake in the company. In sourcing for capital, he has decided to use the following available sources.
Below are the sources where we the start-up capital will be generated from;
- Generate capital from private investors in exchange for shares
- Source for loans from banks
- Generate capital from sale of his stocks
N.B: From sale of personal stock, Mr. Jack has been able to generate $150,000. He has gotten a loan of $150,000 from the bank and is currently in the final stages of obtaining a loan from a private investor to the tune of $100,000.
14. Sustainability and Expansion Strategy
Every serious business person knows that to sustain the business, the loyalty of the customers must be high, the competence of the staff must be second to none, the structure of the business must be sound, and the corporate culture of the company must be stable. These are the factors that if properly crafted and deployed will ensure that the business continues running for as long as it should.
Every business is run to ensure that the business grows to an extent of making enough revenue that can be used to run the business without the need to inject external sources. This is why the marketing team is a very important one as they do not only ensure that the company is positively promoted but also ensure that the company makes enough revenue to remain healthy.
To ensure that our staffs are well motivated, Henai Palm Kernel Oil Inc. will make sure that the welfare packages and other benefits are not only made readily available to the employees but that they are better than what competitors are offering their employees. This will make our employees productivity rate improve thereby resulting to a healthy bottom line for the company.
These strategies if well implemented will ensure that we get and also retain the best hands in the industry, and will also ensure that these best hands remain committed to the vision, goals and objectives of the business.
- Business Name Availability Check:>Completed
- Business Registration: Completed
- Opening of Corporate Bank Accounts: Completed
- Securing Point of Sales (POS) Machines: Completed
- Opening Mobile Money Accounts: Completed
- Opening Online Payment Platforms: Completed
- Application and Obtaining Tax Payer’s ID: In Progress
- Application for business license and permit: Completed
- Purchase of Insurance for the Business: Completed
- Conducting feasibility studies: Completed
- Generating capital from family members: Completed
- Applications for Loan from the bank: In Progress
- Writing of Business Plan: Completed
- Drafting of Employee’s Handbook: Completed
- Drafting of Contract Documents and other relevant Legal Documents: In Progress
- Design of The Company’s Logo: Completed
- Graphic Designs and Printing of Packaging Marketing / Promotional Materials: In Progress
- Recruitment of employees: In Progress
- Creating Official Website for the Company: In Progress
- Creating Awareness for the business both online and around the community: In Progress
- Health and Safety and Fire Safety Arrangement (License): Secured
- Opening party / launching party planning: In Progress
- Establishing business relationship with vendors – wholesale suppliers / merchants: In Progress
- Purchase of trucks: Completed
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Starting Palm Oil Production Business Plan for Making Money
Making Money by Starting Palm Oil Production Business
It is a lucrative endeavor to start palm oil processing business due to the increasing demand across the world. However, it is not easy to enter into the palm oil processing mill industry. You may have no ideas about below questions.
- How is the profit of palm oil making business?
- What equipment do I need? How to select it?
- How to choose the factory site? What is the oil extraction methods suitable for?
- What's the cost to start small scale or large scale palm oil manufacturing business?
ABC Machinery has been the industry of pam oil machinery manufacturing for at least two decades. After years of development, the Palm Oil Processing Machine we supply is suitable for industrial production, commercial business and farm use. Please contact us to get FREE customized project plant for your palm oil mill plant.
Buying Factory Price Palm Oil Processing Machinery for Business Plan
We offer customers with customied Turnkey Solutions, from evaluation, design, project management, process local manufacturing, installation, commissioning, after sales service. By studying every details and selecting ideal plan for the project. We ensure you get the BEST equipment and service. Our hot sale machinery for palm oil processing is generally composed of two types, including small scale palm oil mill machine plant and complete large scale palm oil production line.
Hot Sale Small Scale Palm Oil Mill Plant Display
Small scale palm oil mill machine plant is specially designed and manufactured to meet the requirements of small scale production capacity, becoming popular due to the following highlights.
- Self-sufficient palm oil production, low production cost, low environmental pollution, resource recycling.
- Palm oil mill adopts the most scientific palm oil processing equipment configuration, using mechanical oil pressing technology to make successful extraction of palm oil from palm fruit.
- Suitable for processing palm oil in small farms, small-scale palm oil production workshops and factories and investing in palm oil processing industry.
- Popular in Africa, South Africa, USA, South America, Cameroon, Thailand, Ghana, Nigeria, etc.
- Simple structure, easy to install, operate and maintain.
If you want to start a small scale palm oil production plant or factory as your new business plan, we can offer you the high quality equipment and best service. Come and contact us soon!
Complete Large Palm Oil Manufacturing Plant for Sale
As you can see from the pictures above, a large-scale palm oil production plant includes a complete palm oil production process, which can even be divided into several plants. It can be divided into several processing plants according to the actual condition. Here is the typically divided processes table.
Video of Making Palm Oil in A Complete Palm Oil Processing Plant
Here is the video of a complete palm oil production line sent by our clients. Starting a complete large-scale palm oil production line for industrial purposes is not so easy. You can ask us for help, we can offer you the service from the business plan design to palm oil processing machinery installation and debugging. So, don’t hesitate to contact us!
Successfully Customize Business Plan for Palm Oil Production
Among many poor communities in the world, palm oil is considered for cooking and also as a source of calories and nutrition. It is a consumable vegetable oil extracted from the reddish pulp or the mesocarp of the oil palms. If you visit the tropical areas of Africa, Latin America of Southeast Asia, you will find palm oil being used as common cooking oil. As a result, palm oil processing business plan have become a rage in those areas with a number of plantations already operating there.
In order to make a palm oil production business plan design successfully and start palm oil production factory with low cost, you should do the following jobs. (Read more: Palm Oil Processing Plant Cost >>)
- Find Good Location
It is unnecessary to build up your palm oil milling plant around the market since you don’t sell produced palm oil to the customer directly. The good location for setting up palm oil plant factory is nearby oil palm plantation farm or at least close to place of rich oil palm supply. In addition, it should have good transportation system.
- Get Necessary and Reliable Equipment
In the past, palm oil was mainly extracted by rubbing and squeezing method. However, this method is inefficient and there's a lot of palm oil left in raw materials. Today, advanced palm oil mill machinery can extract most of the oil from the palm fruit. More importantly, most palm oil equipment can be installed locally, reducing costs and increasing efficiency of palm oil manufacturers.
- Setup the Factory
You may need to find some professional workers to set up the necessary infrastructure and install the processing machines. In most cases, the palm oil processing machine supplier or manufacturer will have engineers to help you design the factory layout, install and debug the equipment.
- Hire and Train Workers
The palm oil production plant should be provided with professional workers who can be hired or specially trained to operate all the equipment. For large scale palm oil milling factory, it may also need other staff, such as security personnel administrative staff and so on.
- Marketing Strategy Planning
A complete and prospective marketing plan can help you get more orders and build up your own brand. You can also suggest customers to help you advertise palm oil and bran.
How to Manufacture Palm Oil in Palm Oil Processing Business Plan?
- The fresh fruit branches are then put on a rail-like system in the factory. Then this is put into a steriliser and cooked for 120 minutes. This is done in order to make the fruits come easily from the brunches. The fruits that are received are softer than before, so you can easily remove the pulp from the flesh of the palm.
- Next is the thrashing process. The cooked brunches are put inside a thrasher. The thrasher looks like a drum which has some holes on either side. Here the brunches are extracted off their liquids, and the dry brunches are later used to separate the fruits. The brunch waste which is produced is burnt and the ash that is produced is used as manure since it contains potassium.
- Next the palm oil is released in the fruit by breaking down the oil-bearing cells. There is a digester vessel where the fruits are thrown. The vessel contains a steam heating mechanism which breaks down the oily cells to easily extract the oil. The entire process required 30 minutes and the heating is done at 100 degree Celsius.
- As soon as the material is passed through the digester vessel, pressing is done and a pulp is produced which is made up of oil 53%, water 40% and the rest 7% comprises of solids. A cake like substance consisting of fibre and nuts is produced. The pressing is done either by a wet method using hot water or a dry method employing only squeezing as a process.
- Next is the purification process where the oil is separated from the impurities by decanting through three phases. The oil is then purified in a plate and is dried under a vacuum. This makes the oil thick and lastly it is filtered to remove any traces of impurities. (Related links: Palm Oil Refinery Plant >>)
- Finally the virgin palm oil is packaged and made ready for exporting. So, if you are thinking of a palm oil processing business plan, make sure you have calculated the expenses involved in the whole extraction and processing methods.
- After palm oil distillation, the stearin or glycerol tristearate is obtained with a melting point of 55 degrees Celsius, can it be purified by fractionation?
- Palm oil fractionation: The melting point of stearin or glycerol tristearate obtained from palm oil fractionation is generally around 54, while the melting point of soft fat obtained from fractionation is generally 24 degrees Celsius, but it is a mixture, not pure.
- Why does the operating pressure in the deodorization process have a great influence on the whole palm oil refining section?
- Fatty acids and odor components have corresponding boiling points at a certain pressure, which decreases as the operating pressure decreases. The operating pressure also has an important effect on the time to complete the vapor deodorization. The lower the pressure, the shorter the time required, all other conditions being equal. Deodorization tower vacuum is also related to the hydrolysis of grease, if the equipment vacuum is high, can effectively avoid the loss of distillation caused by the hydrolysis of grease, and to ensure that the low acid value of grease products. The production is generally 300-400Pa, i.e. 2-3mmHg residual pressure.
- - Small Palm Oil Press
- - 1-10 ton/day Mini Palm Oil Mill
- - 1-20 ton/day Small Palm Oil Mill
- - Small Palm Oil Refining Machine
- - fruit reception system
- - sterilizing system
- - threshing system
- - digesting system
- - pressing system
- - crude palm oil clarification system
- - bulk oil storage system
- - palm kernel recovery plant
- - screw oil pressing plant
- - solvent extraction plant
- How to Make Project Cost Budget for Palm Oil Processing Business Setup?
- Start Palm Oil Processing Machine Selection for Business Plan
- How to Make Palm Oil Production Process Design for Starting Business?
- Business Plan Guideline: Palm Oil Mill Plant Factory Layout Design
Global fossil fuel production plans far exceed climate targets, UN says
Model of petrol pump is seen in front of decreasing stock graph in this illustration taken March 25, 2022. REUTERS/Dado Ruvic/Illustration/File Photo Acquire Licensing Rights
- Report comes ahead of COP 28 climate talks
- Oil cut of almost 70% from current level by 2050 needed
LONDON, Nov 8 (Reuters) - Global fossil fuel production in 2030 is set to be more than double the level deemed consistent with meeting climate goals set under the 2015 Paris climate agreement, the United Nations and researchers said on Wednesday.
The U.N. Environment Programme's (UNEP) report, assessing the gap in fossil fuel production cuts and what’s needed to meet climate goals, comes ahead of the global COP 28 climate meeting which starts on Nov. 30 in the oil-rich United Arab Emirates (UAE).
"Fossil fuel phase out is one of the pivotal issues that will be negotiated at COP 28," Ploy Achakulwisut, Stockholm Environment Institute (SEI) scientist and a lead author of the report said in a press briefing.
"We need countries to commit to a phase out of all fossil fuels to keep the 1.5C goal alive," she said.
Under the Paris pact, nations have committed to a long-term goal of limiting average temperature rises to less than 2 degrees Celsius above pre-industrial levels and to attempt to limit them even further to 1.5C.
While scientists say fossil fuel use must be reduced to meet the goal, countries have failed to reach any international agreement on set phase out dates for unabated coal, gas or oil use.
The report analysed the 20 major fossil fuel producers and found they plan to produce, in total, around 110% more fossil fuels in 2030 than would be consistent with limiting the degree of warming to 1.5C, and 69% more than is consistent with 2C.
None of the 20 countries have committed to reduce coal, oil, and gas production in line with limiting warming to 1.5°C, the report said.
It said 17 of the countries have pledged to reach net zero emissions but most continue to promote, subsidise, support and plan the expansion of fossil fuel production.
RISING OIL PRODUCTION
Under current projections the data shows oil production will equate to 218 exajoules per year (EJ/y) by 2030, rising to 221 EJ/y by 2050, equivalent to around 114 million barrels of oil a day (bpd) and 116 million bpd respectively.
However, to remain in line with the 1.5C target the production would need to be 168 EJ/y or 88 million bpd in 2030 and 61 EJ/y or 32 million bpd by 2050, the report showed.
Current global oil production is almost 102 million bpd, according to International Energy Agency data, meaning that production would need to fall by around 14% by 2030 and 69% by 2050 from current levels to be in line with the 1.5C target.
The 20 countries analysed account for 82% of global fossil fuel production and 73% of consumption, the report said and include Australia, China, Norway, Qatar, Britain, the UAE and the United States.
The report was produced by UNEP, as well as experts from the SEI, the International Institute for Sustainable Development and think-tank E3G and policy institute Climate Analytics.
Reporting by Susanna Twidale; editing by Ed Osmond and Christina Fincher
Our Standards: The Thomson Reuters Trust Principles.
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Exxon Mobil Is Drilling for Lithium in Arkansas and Expects to Begin Production by 2027
Exxon Mobil is drilling for lithium in Arkansas and expects to begin production of the critical material for electric vehicles by 2027
Patrick Howarth, left, global business manager, low carbon solutions for ExxonMobil, shakes hands with Sen. Mark Johnson, R-Little Rock, after an announcement of a new lithium extraction operations to start soon in south Arkansas, on Monday, Nov. 13, 2023, at the state Capitol in Little Rock, Ark. Exxon said by 2030 it expects to produce enough lithium to supply the manufacturing needs of more than 1 million electric vehicles. (Thomas Metthe/Arkansas Democrat-Gazette via AP) Thomas Metthe
LITTLE ROCK, Ark. (AP) — Exxon Mobil on Monday announced it's drilling for lithium in southern Arkansas , with the oil giant expected to begin production of the critical material for electric vehicles by 2027.
Exxon in early 2023 acquired the rights to 120000 gross acres (48562 gross hectares) of the Smackover formation in southern Arkansas, considered one of the most prolific lithium resources of its type in North America. Exxon said that by 2030 it aims to produce enough lithium to supply the manufacturing needs more than 1 million electric vehicles.
“Lithium is essential to the energy transition, and ExxonMobil has a leading role to play in paving the way for electrification,” Dan Ammann, president of ExxonMobil Low Carbon Solutions, said in a news release.
Exxon didn't disclose how much it's spending on the project, which is expected to be a boost for a part of Arkansas that has a history as an oil and gas producer.
“I’m not being dramatic when I say this has the potential to transform our state,” Arkansas Gov. Sarah Huckabee Sanders said at a news conference with Exxon and local officials about the project.
Columbia County Judge Doug Fields said the county has already been working with Exxon to ensure roads to the well are prepared.
“Just seeing some of this come in like it is, it's going to be a big pick me up for the area,” Fields said.
The announcement comes as the U.S. faces a greater need for lithium to meet its clean energy goals, with production of electric vehicles rising.
Exxon said it will use conventional oil and gas drilling methods to access lithium-rich saltwater from reservoirs about 10000 feet (3.05 kilometers) underground. It will then use “direct lithium extraction” technology to separate lithium from the saltwater, and convert saltwater onsite to battery-grade material.
The remaining saltwater will be re-injected into the underground reservoirs. Exxon Mobil said its extraction process produces fewer carbon emissions than hard rock mining and requires significantly less land.
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