The first thing to consider in obtaining the oil is the collection of the seeds. Neem is not considered a plantation tree in India so the seeds must be gathered from wild trees growing on the fringes of farms, along hillsides and from roadsides and shade trees around homes in the rural villages. Collection of the seeds is a seasonal affair that has historically been organized by cooperatives that press the oil from the seeds for soap manufacture.



As the ripe fruid falls to the ground, it is gathered from around the trees. Birds will have eaten some of the fruit and the seeds excreted. Other fruit may have been on the ground for weeks, covered with mold or simply rotten. The collected fruit is then carried to a water supply to wash away the fruit covering the seed. After washing, the seeds are set out to dry in the sun. The dry seeds are bagged and sold to village merchants who later sell the to an oil processing facility.

There are three main processes for extracting the oil from the seed kernels with some companies using combinations. The one used since antiquity is the mechanical press method. Neem seed kernels are placed into a tub and either a screw or some form of press is used to squeeze the kernels under pressure until the oil is pressed out and collected.

The second method uses steam and high pressure to extract the oil. The kernels are heated with steam to increase the oil flow then squeezed under high pressure. Most of the oil is extracted from the kernels but it is dark with an unplesant smell and the high temperatures destroy many of the active compounds.

The third and newest method is solvent extraction. Most seed oil processors use this method since almost all of the oil is removed from the kernels. The neem seed kernels are finely ground and placed into a container along with a pertoleum solvent, usually hexane (white gasoline). The neem oil is captured by the solvent and pulled out of the kernels. The solvent/neem oil mixture is then put into a vat where the solvent is recovered leaving a relatively clear neem oil. Sometrimes seed cake obtained after mechanical pressing is further extracted using this method. Many of neem oil's active compounds are not soluble in haxane and are left behind in the solvent extraction process. But many of the most pungent smelling compounds are also not in the oil, making it more usable for health and beauty aids.

Once the oil has been extracted, it is usually put into metal drums for storage and shipment. Since small manufacturers use neem oil primarily for soap manuracture, there has been no demand for pure or clean neem oil. Therefore, inexpensive second hand drums are used to store the oil. With used drums, there is the possibility of contaminating the neem oil with dangerous chemicals that could have been previously stored in the drums. Purchasing neem oil in the open marketplace will usually provide the purchaser with very low quality oil that is potentially contaminated.

The best method for obtaining quality neem oil with a majority of the active compounds intact is cold pressed. In cold pressing the oil is lighter in color with milder odor. There is also the elimination of any potential residual solvents in the oil that could pose health hazzards to the consumer. The downside is that high quality cold pressed neem oil is more expensive to produce than solvent extracted oil and is much harder to obtain. Few processors are willing to forego the loss of any of the oil that could have been extracted by solvent and quit using cold presses.