Mustard Oil Processing Plant Project Report (DPR) 2026

What is mustard oil?

Mustard oil is the pungent, golden to amber edible oil pressed from the seeds of brown or Indian mustard, Brassica juncea, and related Brassica species. Its sharp bite comes from allyl isothiocyanate, a compound released when crushed seed meets moisture. Traditional cold pressing, sold as kachi ghani oil, keeps that pungency intact, while expeller-grade oil from a hotter second pressing is milder, and some processors refine part of the output for a neutral taste.

The oil is a staple cooking fat across northern and eastern India, Bangladesh, Nepal and Pakistan, used for frying, pickling and tempering spices, and it also sells worldwide as a massage, hair and body oil. Because conventional mustard oil carries a high share of erucic acid, customs schedules separate it from canola-type oil: crude mustard oil falls under HS code 151491 and other or refined oil under HS code 151499, while low erucic rapeseed oil has its own subheadings, 151411 and 151419. Seed for crushing trades under HS code 120750. The pressed cake, which keeps a few percent of oil, is sold to solvent extractors and cattle feed makers.

Mustard oil market overview and global demand

Demand for mustard oil is deep but geographically narrow. Credence Research values the market at about USD 21.5 billion in 2025, based on its USD 20.7 billion figure for 2024 and a 3.5% CAGR, and forecasts USD 27.3 billion by 2032 in its global mustard oil market analysis. South Asia accounts for most of that value, while diaspora buyers in the United Kingdom, the Gulf states, North America and Southeast Asia pay a premium for branded packs.

Seed supply sets the ceiling on output. The Solvent Extractors' Association of India estimated the 2025-26 rapeseed-mustard crop at 11.94 million tons, up from 11.52 million, on 9.39 million hectares, with Rajasthan alone at 5.39 million tons, according to a March 2026 PTI report. At a 33–35% expeller recovery, that crop could yield roughly 4 million tons of oil, a Credence Research estimate, although solvent plants process part of it into refined rapeseed oil. USDA's Foreign Agricultural Service forecast Bangladesh's rapeseed-mustard harvest at about 1.5 million tons for 2025/26. Western Canada harvested 139,802 tons of mustard seed in 2025, mostly for condiment mustard and export.

Cross-border trade in the oil is small next to output. Most mustard oil is pressed and eaten in the same country, and the U.S. and EU restrict it as a cooking oil because of erucic acid. Policy in the largest market favors domestic crushing: India's cabinet raised the minimum support price for rapeseed and mustard to 6,613 rupees per quintal for the 2027-28 season, from 6,200 rupees, in September 2026.

Mustard oil manufacturing process

Most mustard oil is made without solvent. Mills rely on mechanical pressing because buyers pay for pungency and aroma, which hexane extraction and full refining strip out. A modern mill replaces the bullock-driven wooden ghani with continuous screw presses but keeps the low-temperature first press that defines kachi ghani oil. The flow below shows a two-stage expeller mill.

• Cleaning and grading. Sieves, destoners, magnets and aspirators remove dust, stones, weed seed and immature grain. Weed seed matters here: Argemone mexicana, a prickly poppy whose seed resembles mustard, can contaminate oil and has caused dropsy outbreaks, so intake testing is critical.
• Moisture conditioning. Seed is brought to a uniform moisture so that the presses run steadily and myrosinase, the seed enzyme, can release allyl isothiocyanate during crushing.
• Cold first pressing. Screw presses run slowly with no added heat, keeping oil below about 50 degrees Celsius on planning figures assumed here, to yield the sharp kachi ghani grade.
• Expeller second pressing. The cake is heated in a cooking kettle and pressed again, recovering milder expeller-grade oil and leaving cake with a few percent of residual oil.
• Settling and filtration. Oil settles in tanks, passes through filter presses and a polishing filter, and is tested for acidity, pungency, argemone oil and erucic acid.
• Packing. Oil is filled into PET bottles, pouches, jars and 15-liter tins, while cake is bagged for cattle feed or sold to solvent plants.

Some processors neutralize, bleach and deodorize part of the oil for customers who want a bland product, but refining adds a separate plant and erases the pungency premium. Oil recovery depends heavily on seed type. Canadian grading data for 2025 show mean oil content of 40.2% for oriental mustard, 34.9% for brown and 30.4% for yellow, so juncea seed of the type grown across South Asia crushes far more efficiently than yellow condiment seed.

Mustard oil plant setup cost

Indicative CapEx for a greenfield mill pressing 100 tonnes of mustard seed a day, with cleaning, two-stage pressing, filtration, a quality laboratory and packing lines, is USD 2–4 million in fixed CapEx at an Asian industrial site using Asian-built machinery, or USD 5–7 million with seed working capital. Equipment list prices anchor the estimate. On an Indian business marketplace, a Ludhiana press maker lists a 150 HP expeller rated at 45–55 tonnes a day in final crush, or 110–125 tonnes as a pre-press, at about USD 118,000, and a Hyderabad supplier lists a complete 100 tonne per day automatic oil plant at about USD 341,000, both converted at an assumed 88 rupees per dollar. With cleaning, tanks, filling lines and a laboratory added as assumptions, machinery comes to about USD 580,000–730,000 before erection.

Seed working capital, held outside CapEx, is the defining cost at about USD 2.7–3.1 million. Mustard is a winter crop harvested from late February to April in South Asia, and a mill that buys when arrivals peak, rather than paying lean-season prices, needs cash to hold about six weeks of crushing, roughly 3,000 tonnes of seed worth USD 2.5–2.8 million, plus oil and packaging stock. Within fixed CapEx, civil works, seed godowns and the tank farm take about 34%, machinery and erection 30%, land 21%, utilities 7% and pre-operative costs with contingency 8%.

Land is the line shown in full here. A 2.5-hectare plot is budgeted, as an assumption, at USD 15–35 per square meter, or USD 375,000–875,000, about a fifth of fixed CapEx. Estates in the mustard belts of Rajasthan, Bangladesh or Nepal's Terai sit at the low end.

Delivered seed makes up about 94% of cash operating cost. Packaging materials take about 3.3%, labor and outbound logistics about 0.7% each, power 0.6%, maintenance 0.4% and administration 0.3%, shares assumed for planning. A U.S. or European site would carry much higher land, construction and labor costs, so the full report can be customized to any country.