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Pre-Feasibility Study

DATES PROCESSING PLANT

Small and Medium Enterprises Development Authority
Ministry of Industries & Production
Government of Pakistan
www.smeda.org.pk
HEAD OFFICE
4th Floor, Building No. 3, Aiwan-e-Iqbal Complex, Egerton Road,
Lahore
Tel: (92 42) 111 111 456, Fax: (92 42) 36304926-7
helpdesk@smeda.org.pk
REGIONAL OFFICE
PUNJAB

REGIONAL OFFICE
SINDH

REGIONAL OFFICE
KPK

REGIONAL OFFICE
BALOCHISTAN

3rd Floor, Building No. 3,
Aiwan-e-Iqbal Complex,
Egerton Road Lahore,
Tel: (042) 111-111-456
Fax: (042) 36304926-7
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5TH Floor, Bahria
Complex II, M.T. Khan Road,
Karachi.
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Ground Floor
State Life Building
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February 2009

Pre-Feasibility Study

Dates Processing Plant

TABLE OF CONTENTS
1

INTRODUCTION .................................................................................................................................2
1.1
1.2
1.3
1.4
1.5
1.6
1.7

2

CURRENT INDUSTRY STRUCTURE ...............................................................................................5
2.1
2.2
2.3
2.4
2.5
2.6

3

MAJOR DATES IMPORTING C OUNTRIES OF THE WORLD ...................................................................10
MAJOR DATES EXPORTING COUNTRIES OF THE WORLD ..................................................................11
DATES EXPORTS FROM PAKISTAN ..................................................................................................11
IMPORT OF DATES IN PAKISTAN.....................................................................................................11

PROCESSING.....................................................................................................................................12
4.1
4.2
4.3
4.4
4.5
4.6
4.7
4.8

5

DATES PRODUCING AREAS OF PAKISTAN .........................................................................................5
PROCUREMENT SEASONS ................................................................................................................6
PAKISTAN’S DATES PRODUCTION ....................................................................................................6
PROVINCE WISE DATES PRODUCTION ...............................................................................................7
DATES PRODUCTION IN BALOCHISTAN ............................................................................................8
MAJOR VARIETIES OF DATES PRODUCTION IN PAKISTAN ..................................................................9

EXISTING MARKETING SCENARIO...............................................................................................9
3.1
3.2
3.3
3.4

4

PROJECT BRIEF ...............................................................................................................................2
OPPORTUNITY R ATIONALE ..............................................................................................................3
VIABLE ECONOMIC SIZE (PROCESSING CAPACITY)...........................................................................3
PLANT AND MACHINERY .................................................................................................................3
TOTAL PROJECT COST .....................................................................................................................4
PROJECT OUTPUT ......................................................................................................................4
KEY SUCCESS FACTORS ..................................................................................................................4

STORAGE OF RAW MATERIAL .........................................................................................................12
FUMIGATION ................................................................................................................................12
INITIAL SORTING ..........................................................................................................................13
CONVEYER BELT ..........................................................................................................................13
WASHING .....................................................................................................................................13
DRYING ........................................................................................................................................13
GRADING......................................................................................................................................13
PACKAGING ..................................................................................................................................13

PROJECT INPUTS.............................................................................................................................14
5.1
5.2
5.3
5.4
5.5
5.6
5.7
5.8
5.9

PROPOSED CAPACITY ....................................................................................................................14
LAND ...........................................................................................................................................14
SUITABLE LOCATIONS ...................................................................................................................14
MACHINERY AND EQUIPMENT .......................................................................................................14
OFFICE AND EQUIPMENT ...............................................................................................................15
HUMAN RESOURCE REQUIREMENTS ..............................................................................................16
DUTIES OF THE UNSKILLED LABOUR ...............................................................................................16
DUTIES OF SKILLED LABOUR ..........................................................................................................16
INFRASTRUCTURE REQUIREMENT ..................................................................................................16

6

LAND AND BUILDING REQUIREMENT .......................................................................................17

7

PROJECT ECONOMICS...................................................................................................................18
7.1
7.2
7.3

8

PROJECT FINANCIAL STATEMENTS ..........................................................................................19
8.1

9

PROJECT COST ..............................................................................................................................18
PROJECT RETURNS ........................................................................................................................18
CAPITAL STRUCTURE OF THE PROJECT ...........................................................................................18

STATEMENT SUMMARIES ..............................................................................................................19

KEY ASSUMPTIONS.........................................................................................................................24

PREF-13/February, 2009

Although. The prospective user of this memorandum is encouraged to carry out his/her own due diligence and gather any information he/she considers necessary for making an informed decision.Pre-Feasibility Study Dates Processing Plant DISCLAIMER The purpose and scope of this information memorandum is to introduce the subject matter and provide a general idea and information on the said area. PREF-13 Prepared by SMEDA-Balochistan Approved by Provincial Chief Issue Date February. The content of the information memorandum does not bind SMEDA in any legal or other form. DOCUMENT CONTROL Document NO. All the material included in this document is based on data/information gathered from various sources and is based on certain assumptions. the content of this memorandum should not be relied upon for making any decision. investment or otherwise. the contained information may vary due to any change in any of the concerned factors. and the actual results may differ substantially from the presented information. due care and diligence has been taken to compile this document. 2009 1 PREF-13/ February. 2009 . SMEDA does not assume any liability for any financial or other loss resulting from this memorandum in consequence of undertaking this activity. Therefore.

very hard stone grooved down one side. Date processing enjoys a high economic importance in the world. and folded in half lengthwise. the trunk clothed from the ground up with upward pointing. Most of the dozen or more species of the genus Phoenix (family Palmae) are grown as ornamental palms indoors or out. are borne on a branched spadix divided into 25 to 150 strands 12 to 30 in (30-75 cm) long on female plants. Dates processing unit established in trading hub will also provide services to other traders/exporters of Dates. others may have perfect flowers. chocolate. thick. Dates are unique as they constitute a set of properties and characteristics. One large inflorescence may embrace 6. The fruit is oblong. P. 1. the male waxy and cream colored). dactylifera L. Dates are among the most valuable fruits and consumed in large quantity. The Portuguese word is tamara. Each leaf emerges from a sheath that splits into a network of fibers remaining at the leaf base. it is dattel. grading and finally packaging. persistent. Further value addition to processed Dates could be done through glazed or stuffed with nuts/sweets. It is consumed in at least three major stages of majority: from fresh. sorting washing.5 cm) long on male plants. is cultivated for its fruit. The proposed project has market edge of supplying hygienically treated Dates to various parts of the country and also has an export potential. in Italian. Some date palms have strands bearing both male and female flowers. overlapping. in Dutch. all across the world..1 Project Brief The proposed project is about establishing a Dates Processing & Packaging plant.000 to 10. Often called the edible date. the stalk holding the cluster may elongate 6 ft (1. Only the common date. To the French.8 m) while it bends over because of the weight. numerous suckers will arise around its base. or dattero. datil. 1 to 3 in (2. and slender.5 m). cylindrical. to increase the quality and shelf life of Dates.5 cm) long. to soft pliable. 2 PREF-13/ February. up to 20 ft (6 m) long. The entire process flow is suggested to be semi automatic requiring both skilled and unskilled workers. and. woody leaf bases. drying.000 flowers.Pre-Feasibility Study 1 Dates Processing Plant IN TR ODUCTION Dates have been cultivated since ancient times in various parts of the world.5-36. it has few alternate names except in regional dialects. Its processing includes fumigation. Small fragrant flowers (the female whitish. As the fruits develop. and especially designed packaging has an additional marketing edge. are composed of a spiny petiole. crisp to succulent. only 6 to 9 in (15-22. In Saudi Arabia it is Nahil and in Pakistan it is called Kajoor in Urdu. The Dates processing project is aiming at value addition. in Spanish. dadel. A fully tree ripened date is self-preserving for months and can be stored or transported as a concentrated food source. in German. dark-brown. a stout midrib. 2009 . After the first 6 to 16 years. reddish. which distinguish them from all major fruits. datteri. Date is an erect palm to 100 or 120 ft (30. gray-green or bluish-green pinnae 8 to 16 in (20-40 cm) long. this is another aspect of this establishment as service provider to third party. slender. it is dattier. Normally it thrives under the rigorous climate of sub-tropical desert. or yellowish-brown when ripe with thin or thickish skin.5-7. sweet flesh (astringent until fully ripe) and a single. The feather-like leaves.

Japan. Germany. Algeria. Canada. Under these assumptions the proposed plant would be producing 2000kgs of processed Dates per day and annual production would be 600. This quantity not only signifies the importance of the date crop as raw yield but also its value addition to exhaust excessive availability and to tap international market to fetch more foreign exchange. UK. Major buyers of Pakistani Dates include India. South Africa. Dates grown in Pakistan have a huge national and international market demand regardless of the fact that major share of our export fetch low value because of substandard. is marketed all over the world as a high value confectionery or fruit. Mekran Belt is having a significant share to the gross date production of Balochistan. cakes and other dessert items. and remains an extremely important subsistence crop in most of the desert regions. Climatic and geographical location of this region is most suitable for the growth of Dates palm and produces high quality yield. walnuts. Pakistan.Pre-Feasibility Study 1. candied orange and lemon peel. Nepal.2 Dates Processing Plant Oppo rtunity Rationa le The Dates fruit.496 million tons in year 2005-06. Sri Lanka. Recent innovations include chocolate-covered Dates and products like sparkling Dates juice. Khan.991ha in Pakistan with an annual production of 0. Iran. The proposed capacity would be viable under the mentioned parameters. Balochistan contributes considerably to the date production of the country and it is having a 50% share of the total production. Dubai. and D. Australia. United Arab Emirates. 1. which is a huge proportion.000kgs. 2009 . China. 1. Dates are one of the most important cash fruit crops of Pakistan. Gwadar.3 Viable Eco no mic Size (Pro cessing Capacity) This designed study proposed a plant with 200kgs per hour processing capacity. Saudi Arabia. Oman.I. The region has been historically renowned by the production of different varieties of Dates. irregular processing and lack of value addition. used in some Islamic countries. Bangladesh. Panjgur. Sudan. Pakistan is the 5th major date producer and fourth largest date exporter of the world. USA.4 Pla nt a nd Machinery The recommended machinery for Dates processing plant is: Machinery Type: Semi-Automatic Plant Capacity: 2000Kgs/10 hrs 3 PREF-13/ February. Libya etc. It has a 45% share of the total country’s production. Major Dates producing areas in the country are Turbat. Dates are cultivated over an area of 81. The total operational days of plant are calculated as 300 days per annum or 25days a month with 10hrs shift per day. Most of the Dates produced in Pakistan is cultivated in Balochistan and Sindh provinces. which is produced largely in the hot arid region of southern Asia and North Africa. Khairpur. for special and religious occasions such as Ramadan. South Korea. Denmark. The overall market share of Pakistani Dates in the world is around 18%. They are used in Arab breads. North Korea etc. Dry or soft Dates are used directly or with fillings of almonds. Major producers of Date are Egypt.

and 2.6 PROJECT OUTPUT The end product would be hygienically washed.143 Million of capital cost. 1. and III. minimize losses and will fetch good profits. The main success factors for the facility are: I. Hygienically treated.178 Million of working capital cost. II. Such processed Dates have export potential and will certainly increase the capital inflows of the economy.Pre-Feasibility Study Availability: 1. shape and unhygienic conditions. 2009 .321 Million. The Dates will be treated and packed on internationally acceptable standards. The total cost is composed of 18. Whereas proposed facility encourages processed and hygienically packed Dates that will not only enhance the shelf life. Availability of raw material at low prices.7 Key Success Factors Traditionally the Dates from Balochistan and other parts of the country are distributed through a well established network of dry fruits mandies without any treatment.5 Dates Processing Plant Local Tota l Pro ject Cost Total project cost for setting up a Dates processing unit is estimated to be Rs. graded and packaged Dates in short the processed Dates. treated. 1. 20. Little competition as no such facility is present in the Dates producing areas. hence improving the quality of Dates. packed and high Quality Dates will bring more revenues from exports and even from the local market. which in cumulates huge loss inform of taste. 4 PREF-13/ February.

000 9 Oman 240. Table 2-1 Province wise Dates production PROVINCE AREA ( Hectares) PRODUCTION (Tones) 2005-06 Balochistan 48136 252.1 Dates Producing Areas of Pakista n Date is a growing business both locally as well as globally.000 metric tons to 496. 2009 .No COUNTRY ANNUAL DATES PRODUCTION IN TONNES (2004-05) 1 Egypt 2 Iran 880. The production of Dates in Pakistan was around 650.000 6 Iraq 650.000 10 Libya 140.000 7 Algeria 450.000 5 Pakistan 650.Pre-Feasibility Study Dates Processing Plant CURRENT IN DUSTRY STR UC TURE 2 The table given below ranks the Dates producing countries of the world. Agriculture and Livestock. Pakistan.000 1.000 metric tons in year 2004-05.F.P 1377 8. Table 2 Major Dates Producing Countries S.869 Ministry of Food.000 Source: FAO STAT 2005 2.000 8 Sudan 330.000 4 United Arab Emirates 760.100.317 Sindh 26681 192. where as a decline was observed from 650.576 metric tons in 2005-06.580 N. Pakistan is the fifth largest Dates producing country worldwide.000 11 Others 140.000 3 Saudi Arabia 830. 5 PREF-13/ February.W.810 Punjab 5797 42.

2 Procurement Sea sons The procurement seasons for the different kinds of Dates are listed in a table below Table 2-2 Province wise Procurement Seasons of Dates Province Balochistan Sindh Province Variety Procurement Period Begum Jhangi Mazawati Gogna Jansor Deshtiari Kharaba Assil 20th August – 30th September 1 st September – 30th September 15th July – 7th August 20th August – 15th September 15thJuly – 7th August 1 st October – 30th November 25th July – 31st August Fasil Karbalai Kubra Valeti Assil 15th July – 7th August -----//----------//----------//-----25th July – 31st August Variety Procurement Period Punjab Dorn 1 st August – 31st August NWFP Dhakki 7th August – 31 st August The above mentioned procurement periods may vary by 10 – 20 days due to climatic conditions. Pakistan’s Dates Production 2. 2009 . The mentioned purchased period is considered as most suitable with reference to freshness and bargain opportunity of the stock. Pakistan produced 496. 2. The over all date production of Pakistan is dividend over the four provinces.3 Pakistan is basically an agriculture based economy and having multi crop supportive agro ecological zones.Pre-Feasibility Study Dates Processing Plant The table shows that Balochistan has dedicated the largest area for the production of Dates as compare to other provinces of Pakistan hence producing half of country’s total date production. In 2005-06.700 hectares. 6 PREF-13/ February.576 tonnes of Dates on an area of 81.

2009 .P 7 PREF-13/ February. 2005-06) of total Pakistan’s production.F. Punjab 42. Balochistan produces around 50% (252.317 tonnes. Provinces wise Percentage of Dates Production in year2005-06 9% 2% Balochistan Sindh 50% Punjab 39% N.4 Dates Processing Plant Province wise Dates production Among all other provinces.810 tonnes.869 tonnes.W. Balochistan is the major contributor of the over all date’s production in Pakistan.580 tonnes and NWFP 8.Pre-Feasibility Study 2. where as Sindh produces around 192.

2009 . and Gawadar are among the major producers of Dates in the province.Pre-Feasibility Study 2.317 According to the data Turbat.5 Dates Processing Plant Dates Production in Balo chistan Balochistan produces 252.136 Production (Tones) 97700 140576 4436 7480 140 1596 91 30 68 116 34 50 252. Panjgoor. Table 2-5 Dates Producing Areas of Balochistan District Panjgoor Turbat Kharan Gwadar Khuzdar Chagai Bolan Sibi Lasbella Nasirabad Jhal Magsi Jaffarabad Total Area ( Hectares) 19955 24207 1121 1874 548 287 45 25 25 24 15 10 48. along with the area under cultivation. The table listed below includes district wise production of Dates. Many districts of Balochistan have supportive agro ecological zones for the production of Dates.317 tonnes of Dates annually and this output comes from different areas of the province. 8 PREF-13/ February.

Aseel of Sindh and Dhakki of Dera Ismail Khan has great demand in international and widely acceptable in our local market. Assil Punjab Dorn NWFP Dakki The table shows diversified varieties of Dates produced in our country. Karbalai. The availability of different varieties calls for establishment of Dates processing plants in order to exploit county’s domestic resources optimally. Pakistan is the fifth largest Dates producing country of the world.7 Million Tons in 2004 (FAO Statistics). Demand potential for the Dates is quite high because of its association with the religious events of both Hindus and Muslims within the country and out side the neighbouring countries. 2009 . Gogna. The production of Dates in Pakistan was around 496. Valeti. which are mainly produced. Among the varieties Begam Jangi of Balochistan. This is very unfortunate that we are not optimizing demand and lagging behind the real profit due to lack of processing facilities. Assil Sindh Fasil. and remains an extremely important subsistence crop in most of the desert regions. For Islamic countries Holly month of Ramadan is the peak season of Dates consumption. are as under Table 2-6 Various Varieties of Dates in Pakistan Province Variety Balochistan Begum Jhangi. B and C. The origins of major varieties. Kharaba. whereas as per nutritional values. its products are used round the year. Dates are well known for its nutrition and high vitamin contents of A. is marketed all over the world as a high value confectionery or fruit. which is produced largely in the hot arid region of southern Asia and North Africa. Kubra. Deshtiari. annual world production of Date was 6.6 Dates Processing Plant Ma jor Varieties of Dates Production in Pakistan It is reported that around 300 varieties of Dates are being produced in Pakistan.Pre-Feasibility Study 2 . Mazawati. it also has high 9 PREF-13/ February. Date trading is a growing business both locally as well as globally.317metric tons. Jansor.576 metric tons in year 2005-06 whereas in the same year the production of Dates in Balochistan was 252. 3 Existing Marketing Scenario The date fruit.

8 Spain 4.2 6.0 8.0 238.8 20. Table 3-1 Dates Importing Countries WORLD IMPORT OF DATES (QUANTITY: THOUSAND METRIC TONNES) Name of County 1998 1999 2000 World 556 655 478 Australia 3.5 3. yet the historical pattern shows an increasing trend of trade in Dates.6 Source: FAO/UN 10 PREF-13/ February.4 U.9 14.1 6.2 percent minerals and 10 percent fibre.Pre-Feasibility Study Dates Processing Plant mineral contents. Dried Dates contain 1.0 13.1 13.0 Turkey 5.0 29. 1.1 6. 70.0 43. 3.4 3.2 40 China 4.5 Russian Federation 2.6 Indonesia 9.2 192.2 8.4 19.0 6.8 23.5 6. The world wide demands for Dates makes this fruit an attractive option to grow.0 180.0 13.9 percent protein. 100. process and export.9 5.5 Germany 6.3 Italy 6.6 percent carbohydrates.0 4.5 U. and carbohydrates.0 10.5 India 244.8 5.9 France 22.5 percent fat.6 23.5 10.0 Canada 5. 13 percent water. 2009 .6 Pakistan 30.1 6.E. 3.0 5.1 Majo r Dates Importing Countries of the world The total trade in Dates is more than half a billion dollars.4 Malaysia 10.2 15.8 2.A.7 5.9 United Kingdom 10.8 5.S.3 4.8 9.5 10.7 5.6 Hong Kong 4.8 Niger 5.7 8. This figure is not very big. 2.3 Sri Lanka 7.6 5.1 Bangladesh 13.A.

but in Ramadan it jumps to 40.000 tonnes of Dates.000 hectares of palm trees under cultivation and 185.000 tonnes in Karachi only. To fill the gap. Pakistan imports Dates from Iran and Iraq. which accounts for around 14 percent of global output. It has 214. Germany. Ma jor Dates Ex porting Countries of the world 3.Pre-Feasibility Study Dates Processing Plant Looking at the major buying countries in 1999. The shortage of Dates occur as large quantity of stocks are wasted because of limited & far-flung processing facilities. South Africa. Denmark. Israel. INDIA was the largest importer with market share of 30%. About 12 percent of Dates produced in Iran were exported during 2001-2002 and large quantities were consumed domestically. There is a big gap between production and export figures. Bangladesh. Pakistan’s total export of Dates has crossed US$ 36 million in 2006-07.2 Iran. in the year 2000 Pakistan has imported 30. 2009 . Karachi. and the same trend has been observed in the previous years.000 metric tons of Dates. Dates Ex ports from Pakista n 3. Iraq. Import o f Dates in Pak istan 3. Japan. Pakistan. UK. Sri Lanka.000 metric tonnes of Dates and is among the top 5 producers of Dates in the world and can supply both dry and fresh Dates. All the major importers fall in the category of developed countries with exception of India. Table 3-3 Exports from Pakistan Fresh Dates Dried Dates Year Qty Tons Value 000 $ Qty Tons Value 000 $ 2001-02 2002-03 2003-04 2004-05 2005-06 4654 3353 2645 4108 4023 2080 1655 1284 2037 2681 72817 67791 62784 79946 85326 25546 23449 21449 27114 29669 Source: Federal Bureau of Statistics. Iran produces about 900. Major buyers of Pakistani Dates include Canada. Algeria. Australia. Government of Pakistan. According to available data. France. Although Pakistan is the fifth largest producer of Dates yet it is among the importer’s list just due to lack of modern production techniques. This means that export of Dates can be increased through modern Dates processing lines. Saudi Arabia. post harvest management and handling practices. The export data shows that Pakistan’s fresh Dates export is very small compared to dried Dates. Dubai. South Korea and North Korea etc.3 Pakistan appeared on the map of date exporting countries in the beginning of 80s in the last century. SA. Tunsia. India.000 hectares harvested area that is about 17 percent of world date harvested area. huge revenues could be exploited only through fumigation and storing.4 The yearly demand of Dates is about 10.000 tonnes. 11 PREF-13/ February. Pakistan on an average export 10 % of Dates production and 90 % crop production is either consumed locally or wasted. China. well organized post harvest management and processing facilities. UAE. Nepal. Egypt are the top exporting countries of Dates. Pakistan produces more than 600. Pakistan and Bangladesh.

Then these are kept in clean crates for transportation to the processing plants. the active component. jointly acting as a warning and fire suppressing agent. air circulation system and exhaust fans.2  Dates are kept in shade  Unprocessed Dates are protected from dust. At times. ammonium carbonate and paraffin. the fumigated Dates are then passed to the other section. texture.  At each delivery these are checked for color. sorted. these are picked in such a way that may not be contaminated with dust or sand of the farm. At the plant side these are fumigated. sized and healthy product which is free of insects or any harmful bacteria. Fumigation at atmospheric pressure is carried out under enclosures of tarpaulin or plastic or in permanent store room equipped with air tight doors. which is initial sorting. taste and flavour Fumiga tio n Dates become infected with insects during transportation and storage. under the trade name Phostoxyn have gained popularity because it is easy to apply and suitable for small rooms or stags covered by polythene plastic sheets and left for about 9 days. The process of dumping/fumigation keeps on going on one hand while from the other side. The method consists of keeping Dates in an air tight chamber and exposing them to a noxious gas for 72 hours. tabling is also carried out with wet towels to clean and produce uniform sizes of Dates. The residue of tablet is a powder which can be removed after treatment. Fumigation by gases can be carried out at atmospheric pressure and under vacuum. The penetration of gases is more intense under vacuum condition and time effective but expensive method. texture modifications. that can take place over a period of storing. Primarily. heat and contamination and also protected from attack of rodents. washed. Amongst various fumigants methyl bromide (CH3Br) is most commonly used presently because it is highly noxious to insects. General process is shown in the flow diagram along with comprehensive details. Since past few years.Pre-Feasibility Study 4 Dates Processing Plant PROC ESSIN G Dates are processed to deliver neat. which could results in spoilage of fruit. tablets of hydrogen-phosphide. Care is also taken during transportation that these Dates are not open to dust or any filthy substances of the road. upon contact with air releases hydrogen phosphide.1 Sto rage o f raw material Before Dates go into processing these have to be stored properly in order to avoid flavor losses. The following rules are generally observed for the purpose. 2009 . The ammonium carbonate is decomposed into ammonia and carbon dioxide. 12 PREF-13/ February. 4. 4. weight loss etc. insects etc. Fumigation is carried out to prevent fruits from insects and keep the fruit fit for human consumption. These tablets consisting of aluminium phosphide. It is also injurious to human beings as such proper precautions are to be taken before entering fumigated chambers. cleaned. 50 to 60 tablets of 3 gms standard are used to fumigate 1000 cubic ft storage space. dried and graded before packing.

8 Packaging The processed Dates are packed by the shrink wrap machine in plastic bags for additional protection and preservation of moisture. The rotten ones are separated and rest of sorted stock is further passed on via conveyor belts to the next step that is washing.6 Drying This is the final processing stage where the washed Dates are dried using diesel or gas fired. Grading is market driven. 2kg. this step/stage of processing is done in manner according to market. 4. This special belt is made up of aluminium to keep the quality of Dates consistently good and avoid rust. The boxes of 1and 2 kg are used in this project as a bench mark. Ovens by applying heat though blowing hot air on it from different angles. 4. 5kg etc) based on consumer’s demand. The water is then automatically drained through it from the small pores in the conveyer belt. 2009 . 4.Pre-Feasibility Study 4.3 Dates Processing Plant Initia l Sorting The initial sorting is done manually where the workers sort the fumigated Dates according to its condition and size. size and test vary with respect to their varieties. The dried dates are then transported through another 15 feet conveyer belt which takes it to the packing section while graded manually on the way. 4. before being placed in boxes. colour. Dates are graded manually in shape. size. The boxes could be of different design and weights (1kg. PROCESS FLOW CHART Fumigation Manual Sorting Washing Packing Grading Drying 13 PREF-13/ February. The rejected Dates are sold for by-products manufacturing. 4.5 Washing In this section the Dates passes through rotatory washing drums with water showering nozzles.4 Conveyer Belt The conveyer belt with steel edges is used to transport the Dates to the next section. skin and even flesh. Colour.7 Gra ding Dates are graded to produce homogenous quality and size according to the specifications of national / international market or specific standards.

The machinery is available locally. 5.Pre-Feasibility Study 5 5. Another essential aspect is access to the market. Angle Iron 2’ ×2” To accommodate 400 crater. 2009 . processing & packaging hall. 5.5 × 5 sqfts Stainless Steel Reduction Gear with 5 HP motor 4. which could be further optimized with double shift and employing extensive staff.000 Sqfts. to install various facilities of the project. Plastic Total Dates = 2000 Kg / Room 2. For financial projection Capacity utilization will be 60% in the first year. Washing Tub Washing drums Drum size Material Drive units Concrete Tank with tiles (civil work) Capacity 250 / batch Dia 2. availability of human resource.4 Machinery a nd Equipment The details of machinery required for the date processing is provided in the following table. 5.3 Suitable Locations Dates processing units are recommended to be installed next to the growing area while considering other mandatory inputs i. Table 5-4 Details of machinery and equipment Machinery & Equipment 1. Plastic Crates Size Quantity 2 × 1 sqfts 2800 3. The table includes the description of different machinery component along with their quantity and costs.2 Land The total land requirement would be of 10. based on singleshift production. and increased at a rate of 5% annually and will be capped at 95%. and office. easy access to market should be considered and studied thoroughly.000 Kgs of Dates. Fumigation Rooms Total rooms Each room size Racks Rack capacity Description/Quantity 7 15 × 12 sqfts Material.e. electricity and water etc. 14 PREF-13/ February. inclusive of storage.1 Dates Processing Plant PROJEC T INPU TS Propo sed Capacity The yearly production capacity of the plant will be 600. Channel 4”× 2”. Sorting/Packing Table Size Rejection cannel 18 × 6 sqfts on both sides of the table.

Shrink Wrap Machine Four Heaters Blower - 8.000 RS 9.000.345.000 RS 1000.000 3. Machinery Cost Plant Cost Installation cost Transportation cost Generator 10 KVA Transformer 50 KV Total Cost 5. 2009 .Pre-Feasibility Study Dates Processing Plant Machinery & Equipment Description/Quantity 5.000 51.000 Total 10.5-1 Office Equipment Description Computer Printer Telephone Fax Machine with Extra Phone Line Total Table 5.5 Ton Window) 72.000 RS 200.2000 15 PREF-13/ February.5 RS 7.000 Office a nd Equipment Table 5. Trays for Oven Feeding Size Material Quantity 2 × 1 sqfts Stainless Steel 100 6.5-2 Qty 1 1 6 1 Cost/Unit 30. Oven Firing Chamber Size Insulation Burner Hot air dryer Rack for tray (S/S) stacking Hot Air calculation blower 5 × 5 sqfts Glass Wool Diesel 0 Gas fired 7 × 4 sqfts - 7.000 Furniture & Fixture Description Total Amount (PKR) 30.000 Furnitu re Three Air conditioners (1.000 RS 1.000 RS 350.000 6.000 12.695.000 Total Amount (PKR) 30.000 500 12.000 6.

Power Water Railway/Road Telecommunication 16 PREF-13/ February. 1 watch man.000 Annually (Rs) 420. Duties of skilled labour Operating the machinery. d. 2009 .000 30.000 72. 2. 1 food technologist.000 72. c. 2.200 The anticipated work force includes 17 employees consisting of 1 manager. grading and packaging.1 accounts officer.000 144.000 3.000 475. 4 skilled workers. 3. 2. Stacking the finished products from the machines.000 Rs.8 1. 5.500 6. 6 semi-skilled.155. 4. b. Maintenance of machinery Manage un skilled workers Ensured effective & efficient supplies Infrastructure Requirement The infrastructure requirements of the project will be: a.Pre-Feasibility Study 5.000 72.900 7.000 360. Washing.9 Duties of the unsk illed labour Loading & unloading of raw materials and finished products. Feeding the machines with raw materials.000 9.000 6.200 540. 4.6 Dates Processing Plant Huma n Resource Requirements The possible human resource requirements for the project are provided in the following table: Table 5-6 Human Resource Details Designation Number Manager Food technologist Accounts Officer Skilled workers Semi-skilled Watch Man Sweepers Driver 1 1 1 4 6 1 2 1 Per Month Salary (Rs) 35. 5. 1 driver and 2 sweepers.7 1. 5.000 12. 3.

000 1.638.638.000.) 2.260 1000 1260 Area in sq.000 1.000 24. 2009 .Pre-Feasibility Study 6 Dates Processing Plant Land and Building Requirement Table 6-1 Land Cost Description Land Table 6-2 Area in sq.200.000 1.000 1.000 5.000 24.ft 200 Office Vehicle Description Shahzor Registration Total Cost 17 PREF-13/ February.000 1.284.000 1300 Total Cost (Rs.224.000 Building Construction Cost Description Office Building (12*14 per room)*3 Fumigation Rooms Warehouse Processing Hall/Building Total Table6-3 Cost/sq.000 Cost/sq.000 Qty 1 Cost/Unit 1.200.000 Total Cost (Rs.000.) 1.ft 504 1300 1.008.ft 10.ft 2.000 Total Cost (Rs.) 1.

250 Project Returns Table 7-2 Project Returns Project 33% 4.000 1.276 8.321.193.1 Dates Processing Plant PROJECT ECON OMIC S Project Cost Table 7-2 Project Cost Capital Investment Land Building/Infrastructure Machinery & equipment Office equipment Furniture Fixture Office Vehicle Pre Operating cost Total Capital Costs Working Capital Raw material inventory Upfront insurance payment Cash Total Working Capital Total Investment 7.38 yrs IRR Payback 7.000 9.345.000 5. in actuals 2.800 18.127.450 20.Pre-Feasibility Study 7 7.000 528. 2009 Amount 20.000 2.000 136.450 500.224.000.321.974 .142.178.2 Rs.284.000 51.150.800 Rs.3 Capital Structure of the project Table 7-3 Project Financing Initial Financing Total Investment Equity Long-term Debt 60% 40% 18 PREF-13/ February.250 12. in actual 1.000 102.

758 12.870.953) -3% -5% 0.16 Year 3 3.305.585 23.305.454.727 9.1 Statement Summa ries Financial Evaluation of Pre-feasibility Dates Processing Plant Key Variables Total Investment in Project Equity Debt Lease Interest Rate Debt Tenure Total Number of Employees Free Cash Flow to Equity (FCFE) Free Cash Flow to Firm (FCFF) Profit margin on sales ROE Times interest earned SMEDA 20.586 3.758 20% 47% 25.019 15.903 Year 6 12.124 27% 64% - Year 9 23.262) (283.54 Net Present Value (NPV) @ 16% 29.218 @ 12% *Re-investment rate has been taken to be the interest on cash in bank. in actuals Year 10 32.599.38 39.664.974 20% 5 17 60% 40% 0% Year 1 (1.431 5.321.478.250 12.389.091 7.931.953.68 Year 2 391.633.019 25% 56% Year 8 20.193.015.897 44. which in this case is 2% PREF-13/February.585 30% 71% - Rs.631.358 11% 23% 4.124 20.935.389.275 8.422 Year 5 7.267 32% 74% - 34% 77% - .127.847.935.166.89 Project 33% 22% 4.222 16% 36% 9.77 Equity Internal Rate of Return (IRR) 38% Modified Internal Rate of Return (MIRR)* 27% Payback Period (yrs) 4.Pre-Feasibility Study Dates Processing Plant Project F ina ncial Statements 8 8.381.931.477 6% 11% 2.39 - Year 7 15. 2009 Year 4 4.

000 102.000 2.224.000.142.178. in actuals 1.321.000 528.000 136.250 Initial Financing Debt Equity Rs.000 5.127.193.800 Working Capital Raw material inventory Upfront insurance payment Cash Total Working Capital Rs.284.450 Total Investment 20.Pre-Feasibility Study Dates Processing Plant Initial Investment SMEDA Capital Investment Land Building/Infrastructure Machinery & equipment Furniture & fixtures Office vehicles Office equipment Pre-operating costs Total Capital Costs Rs.000 51.345. 2009 . in actuals 8.450 500. in actuals 2.150.000 1.000 9.275 20 PREF-13/ February.974 12.800 18.

751 67.336.017 30.075.358.611 16.773 26.380 57.329 211.208 50.535 92.623.225.012 4.800 45.725 4.829 52.865 8.186 369.154 353.079 23.108 286.097 9.209 1.204.903.680.419.117.511 37.452 1.651 234.283.500 158.261.521.226 80.651 25.194 9.128 20.336.064 47.646.539 Revenue Cost of goods sold Gross Profit (543.412 55.717.633.254 7.307 314.066.147.729 163.823 441.658 2.) Promotional expense Insurance expense Professional fees (legal.062) 1.029 336.394.970.738.018.614 49.281 317.360 239.460.703 577.158 27.360 1.003.783 912.947.251 5.658 1.400 27.097 9.737 36.209 52.846 277.179.852.774 21. in actuals Year 9 Year 10 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 20.915 35.552 35.187.027.662 101.056.283.382.700.500 528.169.360 621.279.219.448 7.447.788 179.161 1.362 320.366.767 32.891 30.116 6.003.943 20.837.880 128.641.269. 2009 .741 403.431.336.516 35.097 24.038 4.807.474.693 1.058 6.593 3.709 31.663. fax.655 3.835 8.906.020 305.389.670 251.850 25.678 61. etc.745 39.935.366 179.280 47.240 1.236 1.930 25.209.332.457 122.992 1.600 103. audit.825 5.440.245 111.043 57.336.173 Tax NET PROFIT/(LOSS) AFTER TAX (543.921 11.006.160.360 912.947.250 20.860 524.022 5.500 17.837.058 6.360 93.204 73.455.269.139.400 27.001 23.372 366.720.348 13.528 2.306 16.600.400 269.524.198 245.845 80.939 325.136 4.662.828 25.994.695.Pre-Feasibility Study Dates Processing Plant Income Statement SMEDA Rs.322 7.750.855 1.115 5.497 53.465 12.842.736.732 32.179.504 148.306 40.062) 912.000 244.273 25. etc.943 159.700 1.254.732 12.006 422.186.418.000 4.889 20.461 3.837 1.783 21 PREF-13/ February.614 30.100 15.400 2.503.226 70.734 10.000 1.062) (543.143.972 11.441.186 3.885 290.265.738.542 433.947.283.805 263.401.400 2.400 27.085.448.431.755.843 1.405.336.822 7.879 6.657.152 20.733 830.804 264.272 1.252.666 11.310.476.936 66.746.012.187.538. etc.505 8.427 20.167.200 15.064 20.075.302 (543.070 42.819 477.971 6.605 25.992 394.391 5.225 49.064 20.175 22.274 152.145.266 1.658 16.539 35.311 1.646.916 3.954.306 16.480 135.762 1.823 35.450 20.764.046 64.895.620 Other income Earnings Before Interest & Taxes 5.732 12.376 1.015 Balance brought forward Total profit available for appropriation Owner's withdrawals Balance carried forward (543.336.003.225.695.760 30.388 15.783 4.360 769.480.400 1.062) 912.307 30.999 6.) Office vehicles running expense Office expenses (stationary.297 1.387.253 58.164 332.566.642 1.240 3.713.336.903.000 15.593 12.494 1.523 3.336.688 5.462.804.055 2.315.500 1.336.554 105.190.400 27.800 228.400 1.062) 257.528 2.058 18.056 1.808 12.827 42.502.000 76.135 358.690 73.167.368 5.539 23.499.480.288 475.623.462.139.316.618.379.427 210.945.150 5.528 7.486.160 General administration & selling expenses Administration expense Utilities expense Travelling & Comm.283 15.651 42.006.049.535 66.451.360 1. expense (phone.) Depreciation expense Amortization expense Miscellaneous expense Subtotal Operating Income 1.139.269.400 1.049 452.400 27.462.845 949.430.174 20.152.336.075.818 27.173 Interest expense Earnings Before Tax 1.971 34.610 1.811 38.700 84.609 7.199.925.370 296.179.026.401 1.593 3.

858 3.490 2.106.390 Assets Current assets Cash & Bank Accounts receivable Finished goods inventory Equipment spare part inventory Raw material inventory Pre-paid insurance Total Current Assets Liabilities & Shareholders' Equity Current liabilities Accounts payable Short term debt Total Current Liabilities Other liabilities Deferred tax Long term debt Total Long Term Liabilities Shareholders' equity Paid-up capital Retained earnings Total Equity TOTAL CAPITAL AND LIABILITIES PREF-13/February.275 912.190 1.800 1.Pre-Feasibility Study Dates Processing Plant Balance Sheet SMEDA Rs.698.309.414 8.484.701.577 52.651.484.200 934.000.275 20.732 24.660.311 35.905.378 1.122 2.998 2.452 5.152.690 24.760 5.072 2.027.127.264.050 1.000.808 1.345.535 19.791 1.688.000 4.006.080 20.064 32.275 (543.745.722.360 616.339 35.000.950 2.275 20.200 7.000 9.000.224.770 616.254.612.080 1.696.762.339.500 51.600 2.292.371 12.303.035.854 27.978.400 1.476.275 23.851 2.584.600 45.284.373.629 21.147.275 16.998 2.275 2.414 2.360 12.197 3.000.696.400 5.004.500 10.854 12.620 158.371 27.915 7.333.000 3.740 7.506 1.193.180 411.193.800 10.965 2.000 4.127.593 16.996.360 822.950 4.914.590 205.275 12.102 2.541.651.784 836.321.491.960.980 4.461 3.783 13.400 2.693 1.240 5.905.000 2.027.000 Intangible assets Pre-operation costs Total Intangible Assets TOTAL ASSETS 136.000 2.339.000 25.000 81.000 5.369.003.000 3.147.410.229 Fixed assets Land Building/Infrastructure Machinery & equipment Furniture & fixtures Office vehicles Office equipment Total Fixed Assets 2.357.672.086.852.644 422.573.650.629 12.573.127 937.281 12.500 91.553.144.914.800 489.845 29.027.261 1.178.800 35.740 257.180.815 39.911 2.193.151.511 17.688.193.318 3.059 211.080 82.440 109.275 3.000 612.333 21.380 14.000 2.590 12.720 54.476.000 4.360 21.281 24.047.260. in actuals Year 9 Year 10 Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 500.400 6.850 12.599.656.000 3.300 8.553.458.019.000 2.229 1.600 979.586 1.434.269.462 105.528 14.903.537.193.035.180 205.225 10.000.103 741.200 122.851 3.988 2.720 21.605 4.193.011.166.773 317.000 1.254 9.000.686.728.987 1.072 2.600 20.314.059 20.260.325.262 2.721 82.390 39.440 21.738.200 5.000 528.974 7.275 9.803.000 4.649.803 21.400 30.225.539 36.101.360 27.000 3.755.311 12.669.900 16.686.405.302 6.353.817 1.000.869.326. 2009 - - 12.753.201.049.058 18.633.200 2.953 2.193.316.000 18.800 2.000 20.306 28.193.000.000 61.281 6.000 40.170.506.500 11.193.800 2.283.990 26.000 102.721 12.200 2.906.214 21.000 1.600 2.250 12.179.150.500 71.748.978.800 15.039.950 822.405.642.062) 11.110 34.800 136.324.599.229 .600 367.953 1.987.400 856.011.960.800 8.100 5.600 7.200 40.139.581 31.800 20.193.560 369.963.982.250 109.462.227.200 15.400 9.905.605 4.000 4.101 1.510 1.450 1.140.058 5.008 27.000 5.099.852.649.850 31.096.275 6.461 2.400 2.332.400 244.199.550 2.000.370 655.950 1.656 475.151.574.764.676 4.295.199.768 1.607.791 1.868 21.572.193.974 8.600 12.200 734.725.978.097 21.027.158.372.196.372 24.770 411.650 13.000.500 30.657 3.450 2.070 8.321.275 12.000 51.378 1.681 391.700 13.642.122 2.433.039.869 3.193.334 264.423 5.360 54.947.648 1.646 1.600 2.944 5.428.144.462.800 3.550 3.

572.235) 1.423 37.321.316.360 (1.746.360 (205.385) (581.879 23.336.125 9.124 23.547) (110.336.568) (659.179.658 1.382) (1.262 7.049.064 17.249 5.058 3.700.561) (462.590) (625.523 12.019 20.305.931.822 27.758 15.911 (237.897 Cash balance brought forward Cash available for appropriation Owner's withdrawals Cash carried forward 500.887.033.935.283.943) (1.490 6.092.845 282.049.318 22.Pre-Feasibility Study Dates Processing Plant Cash Flow Statement SMEDA Year 0 Year 1 Year 2 Year 3 Year 4 Operating activities Net profit Add: depreciation expense amortization expense Deferred income tax Accounts receivable Finished good inventory Raw material inventory Advance insurance premium Accounts payable Other liabilities Cash provided by operations (1.264.047) 15.590) (205.633.931.316.528 1.400 27.605 9.280.633.336.664.455.858) (2.593 2.586 3.944 17.916) 52.310.097 6.366.764.587 4.400 1.115) (307.841 23.091 7.382) Investing activities Capital expenditure Investing activities (18.336.336.479) (73.845 52.586 391.950 290.361.213) 52.305.136 1.725) 52.264.539 26.818) (1.075.389.075.000) 391.302 23 PREF-13/ February. in actuals Year 9 Year 10 15.988 2.473 Financing activities Change in long term debt Change in short term debt Issuance of shares Purchase of (treasury) shares Financing activities 8.897 - - - - - - - - - - NET CASH 500.696.656) 52.400 27.368 20.050) (278.657 3.015 1.590) (205.585 12.758 (2.053) (118.574 6.099.003.275 20.947.260.285 2.462.577 52.954.127.450) (1.728.631.974) (547.045 260.590) (205.370) (655.336.944 50.272 1.845 230.728 16.027) 1.337 12.431 4.572.172) (128.845 52.988) 52.728.142.191.585 32.764.858) - Year 7 Year 8 Rs.389.124 23.755.701.336.818) (1.131) (528.000 (500.800) (18.518.045) (712.657 15.530 3.458.804.115) 4.336.318 6.343) (101.000 500.937) (267.682) (1.360 770.572.974 12.498 (398.801.150.736.400 (205.142.618.490 1.019 20.605 30.250 (1.562) (393.800) - - - - Year 5 Year 6 8.581 3.336.414 9.304) (77.409.400 27.099.809) (353.018 2.715 6.260.269.478 172.845 52.015.439.360 (418.139.935.585 32.423 13.360 257.586 3.450) (543.845 239.727 12.845 52.903.400 27.062) 1. 2009 .000 500.332.381.845 1.682) (94.262) (2.347) (138.400 27.400 1.336.306 13.027 (1.254.664.841) (425.773.732 9.506 (507.400 1.845 1.733) (86.000) (528.845 201.678.007 20.887.590) (478.845 219.264.400 1.988 9.193.696.886) (404.000 - 391.452 (203.586 391.

Pre-feasibility Study 9 Dates Processing Plant Key Assumptions Table 9-1 Cost of Goods Sold per Unit of Production COGS 1 (Raw material per unit) COGS 2 (Packing cost and Fumigation Overhead per unit) COGS growth rate per annum Table 9-2 Production Related Assumptions Production capacity per year Sale price per unit in year 1 Sale price growth rate per annum Production capacity utilization in first year Production capacity utilization growth rate Maximum production capacity utilization Table 9-3 600. 35 Rs.5% of revenue 5% 24 . 5 5% 20% 40% 60% 22% 16% 12% 50% of available cash Expense Assumptions Administrative benefit expense Travelling expense Communication expense Office vehicle running expense Office expense 10% of administrative expense 15% of administrative expense 5% of administrative expense 20% of vehicle cost 4% of administrative expense Promotional Expense Machinery & equipment insurance rate 0.000 Kg Rs. 60 10% 60% 5% 95% Economic Related Assumptions Inflation rate Wage growth rate Electricity Growth Rate Water Price Growth Rate Table 9-4 10% 10% 10% 10% Financing Assumptions Interest rate on long term debt Project Debt Component Project Equity Component Tax rate (15% sales tax + 7% income tax) Required rate of return on equity WACC Owners Withdrawals Table 9-5 Rs.

Pre-feasibility Study Dates Processing Plant Office vehicle insurance rate Professional Fee (Legal.1% of revenue 3% of revenue Rs.000 25 .800 Depreciation Rates Building & Infrastructure Furniture & fixtures Machinery Office equipment Office Vehicle Table 9-7 5% 10% 10% 10% 10% Cash Flow Assumptions Accounts Receivables Cycle (In Days) 30 Accounts Payable Cycle (In Days) Initial cash on hand 30 Rs. Audit etc) Bad debt expense Pre-Operational Expense Table 9-6 5% 0. 136. 500.