Palm Oil Storage – The Red Cooking Oil
Palm Oil Storage – The Red Cooking Oil – Igwenazor Chinaemerem
Palm oil, the Red Cooking Oil needs no introduction to Nigerians. It is available in various quantities in every home and constitutes part of our daily cooking. Red oil, has only but one source the Palm tree. It is equally seasonal in its availability owing to the fact that many of the palm trees are non-hybrid varieties. Dealing on this item is a standard business for many people and families over the years.
The Nature Of Red Oil
Red oil comes only from the Palm tree only. It is available in large quantity during the dry season and scarce during the rainy season. During the dry season, it is cheap in price while in the rainy season, it is costly – all things being equal. In most cases there is an annual glut period with a corresponding low price offer thus the investment and business opportunity.
Red oil being seasonal in its availability, storing it during the glut season is a business idea with good income. The business sense is partly limited to gathering and storing them during the glut season in anticipation of the scarce period which is inevitable.
Let’s Do Some Calculations
During the festive period of December, the price of Red Oil do go up only to crash towards the end of January. This has been constant over the years. Last year, the prices went to the roof top. As at December last year, a 25liters of Red Oil was sold for N25,000.00 [Twenty-five thousand naira] but now in the month of March, the same is selling at about N8,500.00 [Eight thousand, five hundred naira] – a whooping difference of N16,500.00 [Sixteen thousand, five hundred naira].
What Are The Likelihood Of The Price Going Up Soonest?
Once the rainy season comes up it will be difficult to harvest the ripe palm fruits, thus reducing the availability of the Red Oil. As the supply is shrinking, the demand is constant with some upwards movement due to population increase. Via the law of demand and supply once the demand for an item is higher than supply, a price increment is unavoidable.
Secondly, the present APC government led by Buhari has blocked all avenues whereby the item could infiltrate into Nigeria. Years ago Red Oil is imported from Malaysia, Cameroon and Ghana but now it’s banned. Also smugglers who could have brought it in are discouraged due to weak Naira. Thus the scarcity is unavoidable in the coming rainy season.
As the glut persist now and envisaged to remain till the end of April, some smart people can take some steps and earn passive income. If you buy and store a 25liters keg of Red Oil at the price of N8,500.00 [Eight thousand, five hundred naira] now, you can sell it at N15,000.00 [Fifteen thousand naira] by July – that’s a difference [profit] of N6,500.00 [Six thousand, five hundred naira]. I do not think such is a bad passive income for an investment of 120days time frame.
With the above scenario, an investment of storing 100 kegs of Red Oil for the said number of days can net offer you an income of N650,000.00 [Six hundred and fifty thousand naira]. If the investment is doubled, you would have made a million plus passively.
Why Is It Lucrative?
All of us are from villages where Red Oil is available in large quantity. As I write, a 25liter keg of this item is sold for N7,000.00 [Seven thousand naira] and below in some remote villages. Such villages may be near you and you may not know. Secondly, you can set this investment up as a second stream of income with lesser man power input.
Ladies and gentlemen, the ball is in your court.
Everything edible is recession proof.