EUCALYPTUS OIL EXTRACTION
Introduction
The extraction of eucalyptus oil is an ago-based technology. The eucalyptus botanical name is eucalyptus citriodora. It is grown in almost all the districts of Uganda. It is propagated through seeds and transplanted after 40-45 days. The harvest is in every 3-4months and economic life of the plant is more than 10years. The yield is 80kg of oil/ha and it is a fast growing tree that reaches a height of about 25 to 40 meters. The revenue estimate is US $ 568 per annum from production capacity of 6,240kg and an investment of US $ 24,075. Eucalyptus oil is used in a variety of industries including making toothpastes, pharmaceuticals, cosmetics and pesticides. It’s lucrative and almost inexhaustible so; worth investing.
Production process, Capacity
The chopped off leaves are subjected to steam distillation for extraction of oil. The mixture of oil and water is separated and then purified by fractional distillation. The extracted oil is stored in big containers and is sealed and packed for the market. The profiled plant has a minimum capacity of 20kg of oil per quarter, translating into 6,240 kg of oil per annum.
Market Analysis
Eucalyptus oil is used in the manufacture of soaps, perfumes, pharmaceuticals, cosmetics, etc. These are fast growing industries. Therefore, there is a wide market in Uganda considering the fact that most of the eucalyptus oil used in Uganda is imported. The export potential of this product is also overwhelming. Oil extraction from Eucalyptus is not yet introduced in Uganda.
Capital Investment Requirement in US $
|
Item |
Units |
Qty |
Cost |
Total |
|
Distillation unit |
Numbers |
1 |
3,500 |
3,500 |
|
Other tools and equipment |
Numbers |
4 |
75 |
300 |
|
Fractional distillation unit |
Numbers |
1 |
5,000 |
5,000 |
|
Total cost of Machinery & Tools |
8,800 |
1. Production costs assume 312 days per year with daily capacity of 20Kgs.
2. Depreciation (fixed asset write off) assumes 4 year life of assets written off at 25% per year for all assets.
3. Direct costs include: materials, supplies and all other costs incurred to produce the product.
4. A production month is 26 work days
5. Currency used is US Dollars.
Production and Operating Costs in US $
Direct materials, supplies and costs
|
Cost Item |
Unit |
Unit |
Qty |
Prod |
Prod |
Prod |
|
Direct Costs |
||||||
|
Eucalyptus |
Kgs |
0.10 |
154 |
15 |
400 |
4,798.5 |
|
Fuel |
Ltrs |
1 |
20 |
23 |
598. |
7,176.00 |
|
Sub-total |
38 |
997.8 |
11,974.5 |
|||
|
General Costs (Overheads) |
||||||
|
Labour |
550 |
6,600 |
||||
|
Selling & distribution |
100 |
1,200 |
||||
|
Utilities (Water, power) |
100 |
1,200 |
||||
|
Rent |
50 |
600 |
||||
|
Miscellaneous expenses |
25 |
300 |
||||
|
Depreciation |
183 |
2,200 |
||||
|
Sub-total |
1,008 |
12,100 |
||||
|
Total Operating Costs |
2,006 |
24,075 |
Project product costs and Price Structure in US $
|
Item |
Qty/day |
Qty/yr |
Unit |
Prod |
Unit |
Total |
|
Eucalyptus |
20 |
6,240 |
3.9 |
24,075 |
5.7 |
35,568 |
Profitability analysis in US$
|
Item |
Per |
Per |
Per |
|
Revenue |
114 |
2,964 |
35,568 |
|
Less: Production and operating costs |
77 |
2,006 |
24,075 |
|
Profit |
37 |
958 |
11,493 |