Palm kernel extraction is a specialised operation undertaken by a completely different set of processors. They are usually better organized as a group and are not as dispersed as palm oil processors. The kernel processors have to go around the palm oil processors during the peak season, when prices are lowest, to purchase the nuts for drying. The nut processing and oil extraction is undertaken in the dry season when the pressure to obtain raw materials has subsided.
The traditional palm oil processing starts with the shelling of the palm nuts. The shelling used to be performed using two stones to crack each nut and separating the kernel and shell simultaneously. This manual operation has been largely superseded by the use of nut-cracking stations.
The mechanical nut-crackers deliver a mixture of kernels and shells that must be separated. The kernel/shell separation is usually performed in a clay-bath, which is a concentrated viscous mixture of clay and water. The density of the clay-bath is such that the shells sink while the lighter kernels float to the top of the mixture. The floating kernels are scooped in baskets, washed with clean water and dried. Periodically, the shells are scooped out of the bath and discarded.
The traditional oil extraction method is to fry palm kernels in old oil or simply heat the dried nuts. The fried kernels are then pounded or ground to a paste in a motorised grinder. The paste is mixed with a small quantity of water and heated to release the palm kernel oil. The released oil is periodically skimmed from the top.