Quality And Standards	:	To yield edible oil as per PFA specifications.
Production Capacity	:	525 tpa
Uploaded on	:	October 2007

Product and its Applications

India imports edible oil to partly meet the domestic demand. The need foralternate sources of edible oil is always felt. The oil present in rice bran to theextent of 15-20% is a promising source. More than 5 million tonnes of rice branavailable annually can yield about 7 lakh tonnes of oil.

The rice bran when exposed to damp atmosphere readily absorbs moisture. The lipase enzymepresent in the bran becomes very active and splits the oil into free fatty acids (FFA), making oil unfit forrefining and edible purpose. It has been found that freshly extracted rice bran, when heated or treatedwith acid, keeps well without increase in FFA and edible rice bran oil can be obtained from this stabilisedbran. Suitable rice bran stabiliser has been developed at CFTRI. It is a simple process of chemicalstabilisation which can be applied in the rice mills specifically in the rural areas to quickly stabilisebran using commercially available hydrochloric acid to lower the pH and inactivate the enzyme.

2.0 Market Potential

Stabilised bran can be stored for longer periods and is used for extraction of edible oil. About 7-8 lakh tonnes of edible oil can be produced, if FFA development in the bran is arrested effectively. At present most of the rice bran oil produced is being used as industrial grade, because of high FFA. The deoiled bran is largely used in animal feeds. The edible oil fetches higher prices and adds to the availability of edible oil in the country.

3.0 Basis and Presumptions

a) The unit proposes to work at least 300 days per annum on single shift basis.
b) The wages for skilled workers is taken as per prevailing rates in this type of industry.
c) Interest rate for total capital investment is calculated @ 12% per annum.
d) The entrepreneur is expected to raise 20-25% of the capital as margin money.
e) The unit proposes to construct own building.
f) Costs of machinery and equipment are based on average prices enquired from machinery manufacturers.

4.0 Implementation Schedule

Project implementation will take a period of 8 months. Break-up of the activities and relative time for each activity is shown below:

Scheme preparation and approval	:	01 month
SSI provisional registration	:	1-2 months
Sanction of financial supports etc.	:	2-5 months
Installation of machinery and power connection	:	6-8 months
Trial run and production	:	01 month

5.0 Technical Aspects
5.1 Availability of Raw material

The total production of rice in our country is more than 90 million tonnes. At 8% degree of milling, we have the total potential of about 72 lakh tonnes of rice bran. There are hullers, shellers, hullercum- shellers and modern or modernised rice mills distributed all over the country. Hence raw material is available in abundant quantity.

5.2 Process of Manufacture

The principle of the process lies in shifting the pH of the bran to the level where the lipase activity would be negligible. This is achieved by using commercially available hydrochloric acid, adjusting the pH to 4.0 at which the activity of enzyme is nearly zero. To achieve complete inactivation of the enzyme system, 40 litres of commercial concentrated hydrochloric acid is required for 1 tonne of bran. The process is simple involving spraying of hydrochloric acid on the bran in drum and mixing the lot for 4 min. The mixing is done in a paddle type mixer, which is provided with an arrangement for spraying of acid from top continuously. Stabilisation of bran by manual mixing in an open pan or on clean surface is also possible for small lots. As the acid does not remain in free state, the treated bran does not affect the contact parts.

5.3 Location

It is pertinent that the rice is stabilised immediately after polishing. The plant can be set up at a central location wherein the rice mills could bring the bran within a short time. The ideal situation would be to set it up as added processing activity within existing rice mills.

5.4 Quality Control and Standards:

To yield the oil meeting the PFA specifications for edible rice bran oil.

6.0 Pollution Control

There is no major pollution problem associated with this industry except for disposal of waste which should be managed appropriately. The entrepreneurs are advised to take "No Objection Certificate" from the State Pollution Control Board.

7.0 Energy Conservation

Since no heating is involved in the process, no fuel is required.

8.0 Production Capacity

Quantity	:	525 tpa
Value	:	Rs. 13.12 lakh
Installed capacity	:	2 tpd
Working days	:	300/annum
Manpower	:	4
Optimum capacity utilization	:	70%
Utilities
Motive Power	:	5 kW
Water	: 2 kL/day

9.0 Financial Aspects
9.1 Fixed Capital

9.1.1 Land & Building	Amount (Rs. lakh)
Land 500 sq.m.	0.75
Built up Area 100 sq. m. @ 2500	2.50
Total cost of Land and Building	3.25

9.1.2 Machinery and Equipment

Description	Amount (Rs. lakh)
Mixer with motor, spraying device with compressor and epoxy coated tanks.	4.00
Erection & electrification @10% cost of machinery & equipment	0.40
Office furniture & fixtures	0.35
Total	4.75

9.1.3 Pre-operative Expenses

Consultancy fee, project report, deposits with electricity department etc.

0.5

9.1.4 Total Fixed Capital

(9.1.1+9.1.2+9.1.3)

8.5

9.2 Recurring expenses per annum
9.2.1 Personnel

Designation	No.	Salary Per month	Amount (Rs.lakh)
Factory Manager	1	7000	0.84
Unskilled workers	3	1500	0.54
	4		1.38

9.2.2 Raw Material including packaging materials

Particulars	Qty.(MT) Per mt.	Rate	Amount (Rs. lakh)
Only servicing	525	1000	5.25
Commercial Hydrochloric acid	21	6000	1.25
Total			6.50

9.2.3 Utilities	Amount (Rs. lakh)
Power 5 kW	0.24
Water 600 kL	0.01
Total	0.25

9.2.4 Other Contingent Expenses	Amount (Rs. lakh)
Repairs and maintenance@10%	0.53
Insurance	0.05
Others	0.42
Total	1.00

9.2.5 Total Recurring Expenditure	Amount (Rs. lakh)
(9.2.1+9.2.2+9.2.3+9.2.4)	9.13

9.3 Working Capital

One month Recurring Expenditure

0.76

9.4 Total Capital Investment	Amount (Rs. lakh)
Fixed capital (Refer 9.1.4)	8.50
Working capital (Refer 9.3)	0.76
Total	9.26

10.0 Financial Analysis

10.1 Cost of Production (per annum)	Amount (Rs. lakh)
Recurring expenses (Refer 9.2.5)	9.13
Depreciation on building @5%	0.12
Depreciation on machinery @10%	0.44
Depreciation on furniture @20%	0.07
Interest on Capital Investment @12%	1.04
Total	10.80

10.2 Sale Proceeds (Turnover) per year

Item	Qty. (MT)	Rate per MT	Amount (Rs.lakh)
Stabilized bran Packed in 1kg PET jars	525	2500	13.12

10.3 Net Profit per year
=	Sales - Cost of production
=	13.12 - 10.8
=	Rs. 2.32 lakh

10.4 Net Profit Ratio
=	Net profit X 100 ----------------------- Sales
=	8.54X 100 ----------------- 63.84
=	13.4%

10.5 Rate of Return on Investment
=	Net profit X 100 ------------------------- Capital Investment
=	8.54 X 100 ------------------ 17.3
=	49%

10.6 Annual Fixed Cost	Amount (Rs. Lakh)
All depreciations	0.56
Interest	2.04
40% of salary, wages, utility, contingency	2.93
Insurance	0.07
Total	5.60

10.7 Break even Point
=	Annual Fixed Cost X 100 ---------------------------------- Annual Fixed Cost + Profit
=	5.6 X 100 ----------------- 5.6 + 8.54
	560 ------------------- 14.14
=	40%

11.0addresses of Machinery and Equipment Suppliers

Sree Siddavinayaka Machinery & Equipment
Site No. 10, 3 rd Stage
Industrial Suburb,Mysore – 570 008

Mysore Industries
2336, 9 th Cross
Basaveshwara Road,Mysore – 560 004

Sathana Industries
A-3, Industrial Estate
Krishnagiri – 635 001,Tamilnadu

Nalanda Agro Works
Industrial Estate Road, Kurji
Patna – 800 011, Bihar

S.K.Engineering & Allied Works
Bahraich – 271 801

Contact for more information:
Information Manager
TIMEIS Project
E-mail: timeis@ficci.com