Palm oil is a kind of tropical woody plant oil, a plant oil variety with the largest production volume, consumption volume, and international trade volume in the world. After refining, it not only improves oil quality and extends the expiration date, but also better meets industry demand. However, setting up a palm oil refinery plant requires a high investment, and the running costs are also high after it is established. This post will analyze how to use a reasonable strategy to reduce the cost of a palm oil refinery plant.
1. Choose the Right Refining Capacity
First, we should choose a suitable scale of refinery oil plant according to the raw material supply and market demand.
- Raw material: Palm oil is favored by the market due to its large production volume, relatively stable price, and suitability for various processing applications. So, an investment in a palm oil refinery plant has extensive market prospects and potential. The market of oil production volume is mainly produced from Indonesia and Malaysia. If it comes to the area of palm oil refinery plant, it has enough raw material, or palm oil refinery plants located near Indonesia and Malaysia could choose a moderately sized refinery.
- Plant scale: The total global palm oil import volume is approximately 418 million tons. The top five palm oil importing countries are India, China, Pakistan, United States, Netherlands. India is approximately 8.7 billion US dollars (accounting for 20.5% of the global import amount). China is approximately 3.4 billion US dollars (8%). Pakistan is approximately 2.9 billion US dollars (6.9%). The United States is 1.9 billion US dollars (4.5%), and the Netherlands is approximately 1.5 billion US dollars (3.6%). So you could choose the scale of a suitable refinery plant according to market demand.
Businesses that have just started a palm oil refinery can initially choose to operate a smaller refining plant. Then, reducing refinery cost or expanding sales scope could lead to upgrading the palm oil refinery plant. This could ensure that recovery costs and upgrading are more cost-effective than a one-time investment.
2. Select the Appropriate Refining Process
The main differences among the batch, semi-continuous and continuous refining oil processing methods lie in processing capacity, automation level and applicable scenarios. You could choose most suitable refining process based on the comparison shown in the table.
| Item | Processing capacity | Automation and Efficiency | Applicable scenarios | Process characteristics |
| Batch refining | Low | Manual operation, with a low automation. | Less raw materials and lower initial investment | operation is simple and suitable for various oil processing. |
| Semi-continuous refining | middle | Some sections has automation, increase efficiency | Stable supply sources and long-term benefits | The deodorization process is automated and continuous, has higher efficiency |
| Continuous refining | high | Full automation , the highest efficiency | Abundant supply and sufficient funds | Low energy consumption and stable product quality |
3. Optimize Equipment Layout and Design
Improper equipment lay out lead to higher constrution cost, unnecessary pipe energy consumption and maintenance difficulty. By optimize equipment layout and design, investor could reduce greatly capiatl and running cost.
- Compact technological process: arrange the degumming, neutralization, bleaching, and deodorization units in the most optimal sequence to reduce material transfer loss and reduce pipeline length.
- Public service: design heating, streaming, and the water supply system is designed to serve multiple units, thereby reducing the infrastructure investment cost.
- Land is smaller: this space-optimized layout method could reduce the area required for buildings, thus reducing land cost.
- Expand the space: modular Design makes future upgrades and renovations without the need for costly reconstruction work
4. Invest in Energy-Efficient Systems
- Recovery waste heat system utilizes the high-temperature crude oil waste heat generated during the oil extraction process and uses it to supply energy for the refining and deodorization procedures through a heat exchanger. The steam consumption decreased by 40%, and the comprehensive energy consumption dropped from the industry average of 38 kilograms of standard coal per ton to 22.8 kilograms of standard coal per ton.
- Automatic control system achieve the full-process data interconnection and remote monitoring of the refining process. Labor reduce 70%, the workforce has been reduced from 20 people per shift in the traditional production line to 6 people per shift. Using AI algorithms to predict equipment failures, providing 48-hour advance warnings, and reducing unplanned downtime by 90%.
5. Source Equipment from Reliable Suppliers
AGICO GROUP provides professional customized service, according to different oil demand, providing a professional refinery solution. Advanced process design, reasonable equipment structure design, meticulous equipment manufacturing, and highly automated technical support ensure investors get the biggest profits.
| Item | AGICO GROUP | Other company |
| Steam consumption | ≤50kg/t | ≤70kg/t |
| Electricity consumption | ≤17kwh/t | ≤22kwh/t |
| White clay consumption | 6-15kg/t | 10-20kg/t |
| Phosphate consumption | 0.5-1.0kg/t | 0.8-1.5kg/t |
| Oil content of waste clay | ≤23% | ≤ 25% |
| Gas consumption | 2.5m³/t | 3.2m³/t |
6. Consider Local Construction and Resources
The construction cost of the palm oil refinery plant includes the workshop and the cost of the palm oil refining production line. If you have your workshop, you could save a lot of cost. It would be best to hire a local construction team to build the palm oil refining workshop. This will be much cheaper than the service that includes both labor and materials. In addition, you could choose to buy building materials locally, which could reduce transport costs.
7. Plan for By-Product Utilization
Palm kernel oil is one of the main by-products extracted during the production of palm oil. It is not only used for cooking oil and baking ingredients, but also is widely used for cosmetics and personal care products.
Secondly, Palm kernel meal is the solid residue left after extracting palm kernel oil. It is mainly used to animal feed.
In addition, palm oil fatty acids are another important by-product during the refining process of palm oil. It is used for producing industrial products such as soap, detergents and lubricants.
8. Work with Experienced Engineering Teams
Our company adopts the EPC mode by integrating the design, procurement, and construction processes, which has reduced the costs at each intermediate stage and shortened the project cycle time. In addition, our company has rich experienced engineers, who could help customers design a detailed palm oil refinery plant, offer customers custom installation service, and guide equipment use, meeting customers’ comprehensive demands for palm oil refinery.
Start Your Project Today
In short, only you realized the factors behind the cost of setting up a palm oil refinery plant, you require the least investment while achieving the highest profit return rate. By the reasonable strategies summarized in this post, you could reduce costs and increase efficiency. If you want to set up or upgrade a palm oil refinery plant, please feel free to contact us!
