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HOW YOU CAN MAKE YOUR OWN CHARCOAL, SELL TO EXPORTERS AND MAKE MILLIONS OF NAIRIA

 

 

 

The cry for alternative energy source has put CHARCOAL in the forefront in the global market. A large market exists in EU, USA and ASIA with prices ranging from $170 to $300 per ton (FOB Nigerian Port), depending on mode of packaging. The charcoal industry is a multi-billion dollar industry and a money spinner for interested investors. The United Kingdom alone consumes more than 60,000 metric tons of charcoal annually, out of which about 70% comes from tropical Africa. Germany, Belgium, Greece the Netherlands, Italy, Poland, Spain, Bulgaria and UK are as substantial importers of charcoal. The total level of volume of exports from Nigeria can not satisfy the demand in the European market. Charcoal is mainly produced from tropical hard wood, although there are other sources like coconut shell. The process of production is called PYROLYSIS. This means burning of wood under high temperature in the absence of air.

The charcoal industry is a sustainable opportunity and engine for meaningful and sustainable socio-economic development at the household and national levels.

There are two methods of making Charcoal: direct and indirect

The direct method uses heat from incomplete combustion of the organic matter, which is to become charcoal. The rate of combustion is controlled by regulating the amount of oxygen allowed into the burn and is stopped by excluding oxygen before the charcoal itself begins to burn, the indirect method uses an external heat source to “cook” organic matter contained in a closed but vented airless chamber (retort). This is usually carried out in a metal or masonry chamber (furnace)

Making Charcoal in a 45 gallons metal drum (indirect): This method has been operated successfully, if the charcoal is to be produced for export, the use of metal drum will enable the high quality demand by the trade to be achieved

The process: You will need metal drum with the lid cut off (you will be able to reuse this drum many, times) Make sure the drum is filled with wood, the dryer the wood, the faster the process. Cut three to five holes, two inches in diameter, into the bottom of the metal drum.. The holes don't need to be perfect; they just need to be large enough to allow oxygen into the drum and let ashes fall through. Try to keep them towards the center. Put the drum down on the bricks, placed so it is up off the ground Start a fire in the drum. When it is going well, put the top back on to reflect back the heat. Since it was cut off roughly, there will be slight gaps to allow a draft. Allow the drum to sit and cool (2-3 hours). Then turn back over, pry off the top and remove your charcoal. If there is a spark, the charcoal may "catch", but just douse it with some water. The charcoal will still be hot enough to dry out. Repeat above process as necessary. Do not remove the can until the fire has completely died down. If the partially done charcoal gets sufficient air, it will burn up.

Production analysis: One man can operate a group of up to 10 drum units. The process involves a carbonization period of about two to three hours, followed by a cooling period of about three hours, An experienced operator can cycle ten drums twice each day to produce a total output of up to 30kg of charcoal from each drum. This means that a one man operation, using 10 kilns, can produce One and a half tons of charcoal per 5-day week, if supplied with adequate prepared wood

The Traditional Technique of Charcoal production (direct): The production technique used in the traditional earth mound Kiln. Charcoal producer go into the nearby forest to fetch woods or collect already disclaimed trees from timber fellers. The woods (sticks) are usually stacked in a rectangular manner with a height of about 4feet, length of about 10 to 12 feet and breadth of about 5 to 6 feet. Three larger woods or logs are used as platform for the arrangement. The woods are arranged according to sizes starting from the largest at the base and the smallest at the top then a large quantity of dry grasses is used to cover the entire stacked wood, which is in turned cover with soil or layer of earth. A hole of about 10cm in diameter is made at a position where the ignition of the stacked wood will be effected. Two holes each are made on both sides of the stacked wood and one more at the end to allow in limited amount of air there by given room for an incomplete combustion of the stock. Several small holes are made on the top for the outlet smoke. These ventilated holes often covered at intervals to regulate the burning of the wood into charcoal. After a section of the stacked wood might have burnt to produce charcoal (about 1 to 3days), the fire is put off and the burning continues at the other section.

Production analysis: This act may require about 2 to 3 people depending on the quantity of wood to be converted per time. It takes about 8 to 9 days for a stacked wood of about 4feet high, 10 to 12 feet in length, 5 to 6feet in breadth to completely burn into charcoal and it is left for 21 to 48 days to effectively cool and ready for bagging. A total of 25 to 30 bags could be obtained from the above mentioned dimension

Where Charcoal can be found: This product is virtually available all over Nigeria as many local communities have perfected the technology of charcoal production. Some known charcoal deports are found in places like Oyo, Isheyin,  Saki Igbo-Ora, Ogbomoso- all in the western part of the country. We also have depots in Jebba, Omu  Aran, Egbe, Kabba in the Central States. Charcoal is found in abundance also in Minna, Jos and Kaduna. Besides, an individual can produce his own charcoal wherever he/she is located.

Uses: Today, there is increased usage of charcoal. Besides being the fuel that cooks steaks, hotdogs, and hamburgers, a number of companies have discovered that charcoal can be used in certain metallurgical purifying treatments and as a filter to remove organic compounds such as chlorine, gasoline, pesticides, and other toxic chemicals from water and air.

Charcoal Season: Charcoal has a seasonal market, but the season differs from one country to another. For instances in Belgium, UK, Holland, France, Germany and Denmark, the Sales season is from May through August because that is their summer time.The Europeans give out their orders from September to May of the following year.

 In countries like Kuwait, Israel and other Asian countries, it is all-year round and order is placed from January through December. However, there are some big time importers in Europe who also order all year round.

Standard Requirement: There are certain standard requirements to be met in charcoal exports; parameters like fix carbon, Ash content, volatile matter, moisture content need to meet buyer’s specification. Some of the buyers use their local agents to inspect here when loading. Others sometimes request for presentation of sample of the product before shipment

Packaging: Packaging of charcoal is usually done to the specification of the buyer. Some want bulk packaging, in which case, the charcoal is tipped into open high cube containers while others prefer packaging into finished packs like 3kg, 5kg, 10kg and 15kg. Shipping is done through a reputable forwarding company and Terms of Trade can either be by letter of credit or Cash Against Document. The latter is however easier and less costly than the former. Packaging in bulk into containers is easier for beginners because capital investment is low.

Financial assistant: Getting capital for the business is easy. All that a prospective entrepreneur needs to do is to source for the orders. Most financial institutions are willing to participate in the business once a valid order is presented. There are also many venture capitalists and individuals with large reserves of fund who will be willing to do the business with you and share your profit at a given ratio

Start up Capital: An initial investment of N615, 000 will cover the cost of product sourcing and landing the charcoal at the product. The money will be enough to acquire enough charcoal that will fill a 40-feet high cube container, weighing 23 tonnes. Charcoal from the south west part of the country would always provide required tonnes. But if the charcoal is sourced from Benue, one would require 27 tonnes to fill a 40-foot container, unlike the South West where only 23tonnes would fill a 40-foot container.The rate of returns is high one can make between 170 and 185 euro per tonne-free on board (FOB) using the Lagos port for a case example. Where individuals cannot raise the initial capital, he can form cooperatives and do the business.

Return on Investment: You can turn your investment ten times within one year and profit in each trip is between N250, 000 and N270, 000

Financial Breakdown: 850 bags will full a 40 feet container. N20 per bag will be charged as processing fee. The laborers that will help you lift the charcoal into the container will collect N8,000 per container. You will also pay local Government due, Association due at the tune of N5,000 per container.

Let us base this analysis on a 40 feet container that can carry 850 bags

Total cost of the filled 23 Tones of charcoal delivered to the port equal to N626,000

Currently the foreign buyers buy at 170 Euros

Therefore 170 Euros x 23 Tones is @ N195 per Euro

The total will equal to 170 x 23 x 195 = N762,450

To get the profit : N762 450 – N626,000 = N136,450

(N136,450)Profit from a Container)

However if you follow the content of this article by producing the charcoal yourself, you can make more money because this financial projection is based on the position that you are buying from the Charcoal producers.

An exporter should be able to exports 4 containers in a month which is N136,450 x 4 = N545,800 Profit in a month.

The foreign buyers would make payment after receiving the bill of lading, showing evidence of delivery to the shipping line of his choice at the port in Apapa

How small investors can catch on this opportunity: A small investors can actually make money either by producing the charcoal and sell to exporters or source for the charcoal from the bush and sell to the real exporters and earn a commission or finders fee. A small investor can also produce this charcoal and sell to local consumers

Opportunity for big Investors: You can act as an exporter in Nigeria and also an importer in Europe, all you need to do is to register a company in Europe, get a warehouse and start packaging your charcoal in small bags of 2kg to 10 kg. You will make over 70% profit .Some Europeans merchants import over 500 container from Nigerians every month, and they package the charcoal in small bags and make a gain of 10,000 Euros instead  of 3,000 Euros.

Start an Home-base export business: Do you know that when you are starting your home base exportation business, you may not need to have a registered limited liability Company from CAC (Co-operate Affairs Commission), you may not register with NEPC (Nigerian Export Promotion Council).you may not have an office which means that you may have to work from home, your presence may not be required for this Business to go on while you make Millions in your house or workplace.
Our Success story: Since your number one life changing magazine  embark on massive campaign on home-based export, we have been receiving report from our readers  who have  been getting good contract from overseas buyers, request for charcoal, sesame seed, palm kernel shell and soya beans oil.

Don't miss this opportunity to get started on your dreams! Take the first step towards making money and living the life you want. Existing small business owners who want to expand into new markets can also benefit from home based business export

Tunji Afuwape

Small business and SMEs Finance expert

e-mail:tunjiafuwape@yahoo.com

Tel: 08033224392