This document gives a exhaustive

1. SANDALWOOD MARKET REPORT - Thailand
H.S.Anantha padmanabha , a qualified scientist with over 40 years of experience in
forestry. He was senior scientist at the Institute of Wood Science and Technology,
Bangalore ( Indian Council of Forestry Research & Education, Government of India
,Dehra Dun( from 1964 to 1998, during which time he was responsible for guiding a
number of research projects on sandalwood and other species of forestry importance.
He has published over 150 publications in both Indian and International journals and co-authored
two books on sandalwood. From 1994 to 1998 he was designated Chief
Technical Advisor for sandalwood project with the World Bank Forest Research
Education and Extension (FREE) project of ICFRE, India.
He was a Forestry Consultant to Department of Conservation (CALM) and Forest
Product Commission (FPC) Western Australian Government, from 1998 to 2002. He is
currently a consultant to Karnataka Soaps & Detergent Ltd, Bangalore, manufacturers of
Mysore Sandal soaps and consulting number other companies growing sandalwood
plantation both in India and abroad.
Introduction
There are nearly 16 recognised sandalwood species distributed all over the world, of
which Santalum album, S. yasi, S. spicatum, S austrocalidonicum and S. lanceolatum
yields fragrant oil of commercial importance. S. album produces the best fragrant
material, and has been one of the most desired perfumery materials for centuries. S.
album is called the East Indian sandalwood. The distillation of powdered heartwood
yields East Indian sandalwood oil. The oil is highly rated for its fixative properties and
for its persistent, heavy sweet woody scent.
Occurrence.
S.album is found in India, Indonesia, Sri Lanka, Philippine islands and Australia.
Commercial plantations are being established in different countries. India was producing
about 80 percent of the world production of wood and oil.
Tropical Asian climate is ideal to make sandalwood plantation. Commercially the
species can be grown with high input technology and irrigation. It has been proved in
India, Sri Lanka and Australia, that the S.album grows well under irrigation and the
heartwood formation occurs as early as 4 years old.
Habitat
S.album is a small evergreen tree attaining a height of 12 to 15 meters and a girth of 1 to
2.5 meters with slender drooping as well as erect branching. It is a partial root parasite
and absorbs nutrients from the host trees. It grows fast in presence of donor host under
irrigated condition. Scented heartwood occurs at age four and continues to increase under

2. correct package of practices. Tree flourishes well from sea level up to 1800 meters
altitude in different soils like sand, clay, red soils and even in black cotton soils. It
flourishes well where there is moderate rainfall of 600 to 1000 mm with long period of
dry weather. It adapts well to different climatic conditions.
Suitability to grow in Thailand
In the literature, the occurrence of S.album has been reported in Northern Province of
Thailand. The natural tropical climate with adequate rainfall will support the existence of
sandalwood trees. Prachinburi Province has a moderate climate with an annual rainfall of
over 700mm, is suitable to undertake commercial sandalwood plantation. Sandalwood is
in great demand in Taiwan, China and India, due to close proximity of theses countries
trading would be easier. This will generate employment potential to the locals and
increase opportunities to develop sandalwood based industries in Thailand and in the
world. Due to similarities in climate condition, desired quality of scented heartwood and
oil can be obtained.
Reference already available for the sandalwood plantation trials conducted in Thailand at
PRACHUAP KHIRI KHAN Forest Research station. Growth parameters have been
recorded up to 10 years. Growth increment was satisfactory and promising, considering
the soil condition. It seems tree had scented heart wood, and generated interest in
cultivating sandalwood by the forest department. The soil was less fertile with a lower
PH. This can be amended by adding nutrients to the soil, so that the growth sandalwood
trees will be optimal.
Picture of sandalwood trees grown in Thailand.
5-11-2010 Sandalwood 11 months.jpg 5-11-2010 Sandalwood 11 months old.jpg

3. 5-11-2010 Sandalwood with host.jpg 5-11-2010 Sandalwood iii.jpg
Sandalwood in TH.jpg
5-11-2010 Sandalwood with host II.jpg
Heartwood formation.
Heartwood formation can occur at four years under plantation management, where as
under natural condition it takes a longer period. The formation and development of
heartwood is dependent on age, growth, and soil and ground moisture. Genetic factors
may also contribute to the heartwood formation. At the time of harvest the entire tree is
removed and heartwood is separated for its fragrant oil. Imitation of scented heartwood
occurs in sandalwood in three to four years, under good plantation management. About

4. 500 trees can be plated in one hectare. The average yield of heartwood per tree is about
25 to 30 kg in 12 to 13 years period. The average yield of oil in 13 years old tree with
good heartwood development would be around 3 to 3.5 percent. The trees can be
commercially harvested to get lucrative returns. The forecast of expected returns is based
on the plantation data available from else where.
The heartwood is hard, heavy, durable and pleasantly scented, yellow or brown in
appearance. Once harvested, a sandalwood tree need to be seasoned (stored for six
months or longer) to allow for natural moisture loss.
Roots, butt, stem and the major branches yield sandalwood oil. Roots contain more oil
compared to stem and the branches. Roots and logs of well developed tree yield fragrant
oil up to 6 percent.
Though different methods of extraction of oil available, steam distillation methods seem
to be the best for superior quality of oil and are widely accepted.
Uses of sandalwood.
Sandalwood is one of the finest woods for carving and turning. Wood and powder is used
in the manufacture of incense sticks. Wood paste obtained by rubbing with water against
a stone is used for religious purposes as well as medicine.
Uses of sandalwood oil
Powdered S album wood upon distillation yields sandalwood oil, which highly priced raw
material in perfumery industry. In perfumery it is valued for its non-varying
composition, fixative properties and for its persistent heavy sweet woody scent.
Because of short supply of natural oil some of the industries are using synthetics and also
adulterates with less expensive chemical compounds, they will revert back to natural
material if the consistent supply is assured.
Consumption of sandalwood oil
Sandalwood oil is mainly used in perfumery formulations, religious functions, handicrafts
and medicines. Some of the most expensive perfumes in the world use sandalwood oil as
the base. The consumption of wood and oil are mainly in the following industries.
● Perfumery
● Attar formulations
● Aromatherapy
● Incense sticks
● Chewing tobacco
● Religious purposes

5. Market trend
From 1990 to 2008 the sale price of sandalwood in India has increased from US $18
to US$ 90.00 per kilogram. The steep increase in price was noticed from 2002 to 2007,
due to short supply and heavy demand. The average increase in price of oil from 2000 to
2007 was US$ 375 to US$ 1900 per kg.. The price for wood and oil will continue to rise,
since the raw material is in very short supply from the natural forest. The gap between the
supply and demand has increased tremendously.
Price trend (Average price per tonne)
1991-1992 US$ 3,404
1992-1993 5,957
1996-1997 8,510
1998-1999 10,851
1999-2000 13,829
2000-2001 15,319
2000-2001 17,300
2001-2002 19,150
2002-2003 32,000
2003-2004 45,000
2004-2005 60,000
2005-2006 83,000
2006-2007 90,000
2007-2008 90,000
2008-2009 1,00 000
1 US$ = INR 47
The price of sandalwood oil increase commiserating with the price of wood..
Legal sandalwood production
Year In Tonnes
1997-98 1800
1998-99 1600
1999-00 1200
2000-01 1000
2001-02 1200
2002-03 1400
2003-04 1100
2004-05 1000
2005-06 800
2006-07 600

6. 2007-08 400
2008-09 400
There is gradual reduction in the supply of wood from the natural forest. There is
good regeneration in the natural stands, but the trees are young and may take some more
years for harvest.
Current demand
India was supplying about 80 percent of world requirements of wood and oil till the
year 2000, but it has declined sharply due to over exploitation of natural stands.. The
current annual legal production does not exceed 500 tonnes of wood. There is total ban
on the extraction of sandalwood in Indonesia; hence there is a limited supply to the world
market. Australia has made a considerable progress in establishing sandalwood
plantations and they may be able to supply to the world market about 20 to 30 percent of
world requirements.
It is estimated that the annual requirement of wood globally is around 5000 to 6000
tonnes. The supply is limited and the alternate wood of different species is being used in
place of Indian sandalwood. Since the supply of different species is also fast declining
and some countries, imposed ban on extraction and export. The demand of natural oil is
on the increase though synthetic substitute are available in the market. Synthetic
substitutes are mostly used in the low quality perfumes, where fragrance dissipates
rapidly. The prolong use of these synthetics on skin may be harmful.
Some of the reasons for the increase in demand for the natural sandalwood oil as
compared to synthetics are:
Synthetics chemicals are molecularly different to natural sandalwood oil.
Synthetic chemicals differ significantly in olfactory products.
Natural oils have high odour thresholds
Therapeutic benefits- synthetics has different resultant impact on the nervous system.
Some of the major perfumery, attar and scented tobacco industries have become
aware that the users may slowly reject synthetic products because of harmful side effects.
Habitual users can easily identify the difference between the synthetic and natural
products based on smell, odour and its long lasting effects.
Due to progress in the developed and developing nations there is shift in the use of
synthetic substitute. As a result of the synthetic revolution, there is a perceived threat to
the continued use of natural products in perfumery industry. This threat has been created
by the presence of multinational companies seeking maximum profit at low cost.
Although these companies dominate the fragrance industry, smaller companies still
provide specialist services to the industry and to its customers. Customer market demands
and ensures that the use of natural perfume ingredients is both an imperative and an ever-increasing
requisite.

7. The supply of sandalwood and oil is on the decline globally, the other species of
santalum used as alternate to Indian sandalwood in the sandalwood industry is also facing
threat due to over exploitation. Sandalwood plantations growing outside the forest limits
are the only solution for the consistent supply of raw material. The assured supply of raw
material will help in stabilizing prices of wood and oil, so the industries can plan for the
future well in advance. The global market can absorb more than 6000 tonnes of Indian
sandalwood.
Concluding Remarks
Thailand is a tropical country with congenial climate condition to grow East Indian
sandalwood. Sandalwood trees have been introduced to the country during the last
decade, and sufficient data is available for its growth behavior. The site selected for the
cultivation has climate with wet and dry season with an average temperature between 27
to 30 oC with abundant supply of water. The soil PH needs to be increased from Neutral
to slightly alkaline for the better growth. Sandalwood trees has good capacity to adapt to
different environmental conditions.
H.S.Anantha Padmanabha
Forestry Consultant
#31, 2nd Main, Poorna Pragna Lay out
BSK 3rd Stage
Bangalore-560085
India
Tel. +91 80 2679 2528
Moblie. +91 8990142825