§1What this business is

Nutmeg (jaiphal) is the seed kernel of the nutmeg fruit and mace (javitri) is the red net-like cover around it. The unit receives ripe fruit or seeds from farmers (30–35% moisture), dries them, cracks the shells, separates, grades, disinfects and packs. Buyers are spice traders, masala makers, oleoresin units and exporters.

Capacity: 250 kg a day in a 10-hour shift; year 1 planned at 30% capacity.

§2Is it right for you?

Who it is for

A spice trader or grower group in a nutmeg belt that can buy directly from farmers.

Who it is not for

Someone far from growing areas or without spice-trade contacts.

Advantages

  • Two products (nutmeg and mace) from one fruit
  • Steady demand in Indian cooking and medicine
  • Export demand, especially Europe
  • Low break-even in the report (27%)

Drawbacks

  • Only works near nutmeg-growing areas (mainly Kerala)
  • Large working capital for seasonal buying
  • Margins are thin (net 4.8% in year 1, 7.2% in year 5)
  • Fungus (aflatoxin) if drying is poor

Skills you need

  • Judging fruit ripeness and moisture
  • Drying and grading control
  • Food-safety and export quality norms
  • Spice market prices

Why difficulty 3/5: Needs a sourcing network in a small growing belt and careful quality control.

§3Market

Who buys

  • Spice wholesalers and masala makers
  • Oleoresin and extract units
  • Exporters and overseas buyers
  • Ayurvedic medicine makers

How it sells

  • Spice markets and auction centres
  • Direct supply to processors
  • Export through merchant exporters

Good to know

  • The report names Guatemala, India and Indonesia as the main producers and exporters.
  • The report says the Netherlands took nearly a quarter of European nutmeg imports in 2017, and quotes global market growth of 3.6% a year (2020–2025).
  • Nutmeg oleoresin extraction in India and Sri Lanka adds demand.

§4Raw material & machinery

ItemQtyCost
Hot air dryer1₹1,25,000
Nut cracking machine1₹1,80,000
Vibro separator1₹1,50,000
Grader machine1₹1,65,000
Metal detector1₹1,50,000
Filling and packaging machine1₹3,80,000
Material handling and other equipmentlump sum₹1,50,000

From: PMEGP sample project report — Nutmeg Processing Unit (prepared by Udyami/Samadhan)

  • Ripe or mature nutmeg fruit / seedsbought from farmers at 30–35% moisture; ₹67.50 lakh in year 1
  • Packaging materialfor graded nutmeg and mace

From: PMEGP sample project report — Nutmeg Processing Unit (prepared by Udyami/Samadhan)

§5Licences & registration

  1. FSSAI licence
  2. Udyam registration
  3. GST registration
  4. Spices Board registration (CRES) for exporting
  5. Import Export Code (IEC) for exporting

We can do this registration for you

§6Schemes & subsidies

PMFME and AIF (post-harvest primary processing) fit; PMEGP and CGTMSE; Stand-Up India for SC/ST and women founders.

§7Money

How the investment is worked out: Report cost of project: plant & machinery ₹13.00 lakh + furniture ₹0.80 lakh + working capital ₹8.85 lakh = ₹22.65 lakh; land own or rented. Finance: term loan ₹12.42 lakh, working capital ₹7.97 lakh, own ₹2.27 lakh.

Working capital: Working capital ₹8.85 lakh (bank limit ₹7.97 lakh) — 10 days of raw material, 15 days of finished goods and 15 days' credit to buyers.

Year not printed on the report — check current machinery prices.

How to prepare a loan file

§8Export potential

Confirm the HS code in the DGFT ITC(HS) lookup before you export

0908.11Nutmeg, neither crushed nor ground0908.21Mace, neither crushed nor ground

Export council / board: Spices Board India

  • HS codes are from the WCO HS 2022 list; confirm the 8-digit ITC(HS) line with DGFT or your customs broker.
  • You need an Import Export Code (IEC) from DGFT before the first shipment.

§9Risks — where people fail

  • Price swings in nutmeg and mace
  • Crop failure in a bad season
  • Aflatoxin and rejection of export lots
  • Working capital locked in stock

§1030 / 60 / 90-day plan

A general plan that applies to any business. A plan for this business will be added after research.

  1. Days 1–30: Visit a working nutmeg and mace processing unit, ask 10 buyers about price and quantity, and get quotations from 3 suppliers.
  2. Days 31–60: Udyam and the licences you need (FSSAI licence, Udyam registration), a project report (DPR), and the scheme or loan file.
  3. Days 61–90: Space and machines, trial production, and first deliveries to 10 customers.

§11Who to connect with

Not verified yet

Associations, clusters and training institutes — the directory is being built. Connect

§12Watch

There is no episode on this business yet. Shows are coming soon on the Podcast page.

Want to start Nutmeg and Mace Processing?

DPR, loan file or registration — ask us on WhatsApp.

Get a DPR / loan file made

Sources

  1. PMEGP sample project report — Nutmeg Processing Unit (prepared by Udyami/Samadhan)

Data review: 6 October 2026. Spotted a mistake? Report it. For information only — not legal or financial advice.