Western Australia has overtaken India as the world’s leading supplier of sandalwood, with 2,000 tonnes of native sandalwood harvested in the state each year.
Western Australia has overtaken India as the world’s leading supplier of sandalwood, with 2,000 tonnes of native sandalwood harvested in the state each year.
WA currently supplies about 40 per cent of global sales.
Forestry Minister Kim Chance said markets worldwide were facing a serious shortage of increasingly expen-sive, high-quality Indian sandalwood.
“This is largely as a result of unsustainable harvesting of this species over a long period of time in India, East Timor and other parts of Asia,” he said.
“During the past 10 years, as sandalwood supply from the rest of the world has decreased, WA sandalwood has significantly increased its share of the global market.”
Last week, the state hosted a group of 20 Asian sandalwood buyers at a three-day symposium and field trip.
Among WA’s oldest exports, sandalwood and associated products have long-standing markets throughout Asia.
In a sign of the industry’s growing stature, sandalwood is now also processed locally, in contrast to the historical export of raw sandalwood logs.
Albany-based company Mt Romance, through its subsidiary Australian Sandalwood Oil Company Pty Ltd, has a contract with the Forest Products Commission (FPC), which manages the state’s sandalwood industry, for the supply of sandalwood until 2016.
Mt Romance’s annual sandalwood oil exports total more than $10 million, with its main export markets being France, India, North America and the United Arab Emirates.
Mr Chance expects the state’s global market share to continue to grow to the extent that, in the future, WA could effectively control the sandalwood market.
“We have 40 per cent of the market and that will climb, so it may be possible for us to control the supply side of the market, through a product or export licence arrangement,” he said.
Sandalwood is a fragrant timber, the oil of which has become an increasingly important commodity for the world’s perfume industry, with European fragrance houses, Chanel and Christian Dior, among others, using sandalwood oil in their products.
Sandalwood also has broad medicinal and therapeutic applications in aromatherapy, and is used in soaps, candles and, traditionally, in incense.
With supply tightening and global demand increasing, WA is also at the forefront of developing plantation Indian tropical sandalwood to complement the naturally growing WA species.
At a current price of around $105,000 per tonne, Indian sandalwood is the world’s most expensive tropical hardwood and its price continues to increase each year.
The native WA variety is worth around $20,000/t.
“Indian sandalwood produces significantly more oil and is more valuable than the native WA species we currently supply to overseas markets,” Mr Chance said.
The total area of wild stands of WA sandalwood covers about 160 million hectares, half of which is suitable for harvesting, although the regeneration of these native stands has declined in recent years.
As further evidence of the strong demand for sandalwood, Mr Chance said the industry had taken additional steps to deal with short-term demand spikes by using other parts of the sandalwood tree, such as the leaves and nuts.
The FPC has spent 20 years establishing plantations of Indian sandalwood, predominantly centred around the Kununurra area in the state’s far north.
Perth-headquartered plantation managers, Tropical Forestry Services Ltd and Integrated Timber Cropping Ltd, have significant Indian sandalwood plantations in the region.
In an attempt to increase sandalwood stocks in the state, the FPC has also established large-scale Indian sandalwood plantation trials in the Carnarvon area.
“Although it is early days, FPC foresters and scientists are confident they can successfully grow Indian sandalwood in the Carnarvon area by employing proper planting regimes and main-tenance systems,” Mr Chance said.
The minister also noted that plantation WA sandalwood was being trialled in the Wheatbelt.
Sandalwood has as a relatively short harvest period – 14 years – which is another appealing aspect for plantation managers.
