How To Start A Lucrative Peanut Butter Production Business in Nigeria: The Complete Guide

Peanut butter is one edible food with a high contribution to the global economy. Peanut butter was first introduced in the early 1800s, but wasn’t developed until the 1890s and only began to grow popular in 1920s when it underwent mass production. Since its discovery and mass production, peanut butter has further experienced quantum leaps in popularity and production. Peanuts are multi-purpose crops grown worldwide.

In 2019, the global peanut butter market reached a value of US$ 3.5 Billion, exhibiting a CAGR of 4.6% during 2014-2019.

Nigeria currently produces about 2,000,000 metric tonnes representing five per cent (5%) of world production. Between 1956 and 1967, groundnuts, including its cake and oil, accounted for about seventy per cent (70%) of Nigeria’s total export earnings. The massive production resulted in the legendary groundnut pyramids which dotted the landscape of Kano.

Till date, peanut butter remains one of the most common everyday foods in the world, as it continues to be processed into newer edible forms. Starting a peanut butter production business in Nigeria or Africa is a brilliant idea for entrepreneurs irrespective of your capital size.

See Also: How To Start A Lucrative Custard Powder Production Business in Nigeria: The Complete Guide

What is Peanut Butter?

Peanut butter is a food paste or food spread made basically from dry roasted peanuts. It is made by grinding, and often contains additional ingredients such as salt, oil sweeteners and others for taste modification and texture improvement.

What Is Peanut Butter Production?

Peanut butter production is the processing of peanuts into a more refined, smoother, buttery form. The peanuts are harvested from a plant in the second part of every year, in clear weather.

See Also: How To Start A Lucrative Fruit Juice Production Business In Nigeria: The Complete Guide

Business Opportunities In The Peanut Butter Production Business In Nigeria & Around The World

1). Food Spread:

Peanut butter serves as a spread for other edible products like crackers, toast, etc. It is used in making sandwiches (popularly known as peanut butter and jelly sandwich) and generally all forms of bread. Peanut butter does not only complement taste but also adds more health value to a meal.

2). Baking:

It is also used in several baked and even non-baked dishes and desserts such as peanut-flavoured granola, smoothies, crepes, cookies, brownies, or croissants.

3). Hair Products:

Peanut butter can be used in the making of hair products which include hair shampoo, conditioners and hair cream. It contains good hair treatment properties and is also known to aid hair growth.

4). Skin Care Products:

Peanut butter is a rich source of vitamin C and E, which help to slow down the ageing process in humans. It is also rich in antioxidants which reduce wrinkles and contribute to skin health.

Facts And Benefits Of Peanut Butter

• Peanut butter provides the body with 180 to 210 calories per serving, which is just enough for the body to function effectively throughout the day.
• Peanut butter is rich in its dietary fibre content, containing about 20% of the daily supply.
• Peanuts are energy-rich products and are usually marketed as substitutes for milk butter.
• Other than energy, it also offers fibre, protein and unsaturated fats.
• Peanut butter is also rich in micronutrients such as magnesium, zinc, potassium and Vitamin E
• Groundnut is known to be the 13th most important food crop in the world.
• It is the 4th most important source of edible oil and 3rd most important source of vegetable protein known globally.
• About $800 million worth of peanut butter is consumed in the US on an annual basis.
• North America is currently recognized as the biggest market for peanut butter.
• It promotes a healthy heart.
• Contributes to strong bones.
• Reduces risks of cancer
• Fights against Alzheimer’s Disease
• China, India, Nigeria, USA and Sudan are the producers of peanut butter.
• Every 100 grams of peanut butter contains 25.8 grams.
• They are high in oleic fats.
• Peanut butter is also rich in vitamins and minerals such as Niacin and Folate.
• American astronaut Alan Shepad took a peanut with him to the moon in 1971.
• A typical peanut butter farm takes about 200 acres.
• Thomas Jefferson and Jimmy Carter were both peanut farmers.
• An average person consumes as much as 3,000 peanuts in their lifetime.
• In Nigeria, peanuts are grown in Kano, Kaduna, Taraba as well as other Northern states.

See Also: How To Start A Lucrative Jam Production Business in Nigeria: The Complete Guide

Types of Peanut Butter

1). Conventional Peanut Butter:

This is a type of peanut butter that is not purely made but has other products added to it. One of these is partially hydrogenated vegetable oil. Hydrogenated vegetable oil is mixed with peanut butter to prevent it from separating during conveyance and also give the peanut butter a smooth, creamy texture. These types of peanut butter tend to cause heart disease as they contain trans fat and take up to 20% of the peanut butter.

2). Natural Peanut Butter:

As the name implies, natural peanut butter is a kind of peanut butter 100% made from peanuts. As proof of originality, peanut oil would naturally separate from the solid part when set in a position for long. This, however, is considered inconvenient as the oil would have to be mixed back with the solid at the point of use. The natural peanut butter is the same as grinding roasted peanuts in a processor. All organic types of peanut butter fall into this category. It is the only way to make peanut butter using just organic ingredients that meet the federal definition of peanut butter.

3). No-Stir Butter Spread:

Peanut butter companies opened up a new wave with “no-stir” peanut butter spread options. Still, this type of butter is not legally allowed to be labelled “peanut butter.” This is because they contain refined palm oil, which is not a standard peanut butter ingredient in the FDA’s definition of peanut butter. You will find these products commonly labelled as “peanut butter spread” (reminiscent of the products labelled “chocolatey” or “chocolate-flavoured” when they do not meet the FDA’s definition of chocolate).

How To Startup Peanut Butter Production Business: Step-by-Step Guide

1). Washing:

The first step after peanuts have been harvested is to wash them in water to get rid of dirt.

2). Shelling:

Afterwards, the peanuts are transported to a peanut shelling machine for mechanical drying. The shelling must be carried out meticulously otherwise the seeds may get damaged during the removal of peanut shells.

3). Cracking:

The peanuts are then sent to a series of rollers set specifically for peanut batches, where they are cracked, and after breaking the peanuts are put through an examination process where they are inspected for any contamination.

4). Roasting:

In this process, peanuts are heated in large quantities in a revolving oven at a temperature of 800 °F (427 °C). The peanuts in each batch are further roasted at a temperature of 320 °F (160 °C) for about 40 to 60 minutes. This method is most favourable when the peanuts differ in moisture.

5). Cooling:

The roasted peanuts are then removed from the oven and directly placed in a blower-cooler cylinder to let out the heat. The cooler is built with suction fans in the cylinder which can pull in a large volume of air thereby cooling the peanuts much more efficiently than other processes. Cooling also helps the nuts retain moisture.

6). Blanching:

Blanching is simply the process of removing the skin of peanut; This is conducted in two ways; heat blanching or water blanching but the most popular blanching method is heat blanching. This process is done by emerging the peanuts in hot water for approximately 3 minutes and then cooling them rapidly to remove seed coats. Another method of the heat process is by having the peanuts heated with air at temperature 280 °F (138 °C) in other to soften and split the skin; this should be done for 15 minutes. After that, the skins are removed with bristles and disposed of.

7). Grinding:

After blanching, the peanuts are put through two different grinders. The first grinder is for giving the nuts a medium grind while the second produces a fine grind. At this point, salt, sugar and vegetable oil stabilisers are all added to the fine peanut grind to make the peanut butter.

8). Packaging:

The peanuts are first cooled, and once this is achieved, the butter mixture is pumped into jars and then sealed.
Vacuum sealing rids the containers of all oxygen to prevent oxidation which is a form of preservation. The peanut butter is further packaged and stored at room temperature.

See Also: How To Start A Lucrative Bread Bakery in Nigeria: The Complete Guide

Challenges of Peanut Butter Production Business in Nigeria

• Increase in cost of production
• High market competition
• Peanut butter isn’t a popularly used product by majority of Nigerians
• Low governmental funding
• Limited storage facilities for unprocessed peanut butter.
• Poor road network for distribution of peanut butter products across the nation.
• Inability of local producers to reach the international market.
• Lack of preservation means to keep peanut products from perishing.
• Water scarcity in certain regions especially during dry and harmattan seasons.
• Occasional decrease in demands
• Absence of favourable government policies for dealers in peanut butter.
• Limited loans for local farmers of peanut butter.

See Also: How To Start A Lucrative Dairy Farming Business in Nigeria: The Complete Guide

To Sum It Up

Peanut butter production is a lucrative and economy-advancing endeavour, in the sense that, it gives Nigerians refined quality access to one of the most favoured snacks, popularly known as groundnut (peanut) but in a different form.

The peanut butter business in Nigeria can be a lucrative and profitable venture to start-up, due to its vast market demand and on your ability to build a wide supply chain network. If you’re looking for a supply chain business to venture into, the peanut butter production business in Nigeria is a great option to explore.

Trying To Secure A Business Loan? Finance? Or Investment?

You can now greatly increase your chances of getting the loan/investment you need with our bank and investor ready professional MBA standard business plan writing service

Writing a bank and investor ready professional peanut butter production business plan can be challenging. If you need a professional and affordable business plan service, StartupTipsDaily’s MBA standard professional business plan writing service is perfect for your small business.

All you have to do is request an understanding of your proposed business model, and you’d have a professional MBA standard business plan ready for you anywhere within 5 to 14 days. You can click here to get started with using StartupTipsDaily’s professional business plan writing service to create the perfect business plan that’d get accepted anywhere.

What are your thoughts on how to start a peanut butter production business in Nigeria? Let me know by leaving a comment below.