Agarwood downstream industry can grow further, says Malaysia

JELI (BERNAMA) – The agarwood downstream industry has the potential to grow even further as many entrepreneurs have yet to take part in the sector, especially in perfume manufacturing, said Malaysian Plantation Industries and Commodities Minister Datuk Dr Mohd Khairuddin Aman Razali.

He said that locally, there has been a lack of participation in the industry, despite the fact that Southeast Asia is well known for producing agarwood essential oils used to produce perfumes in the Middle East.

“As of December 2019, only 217 companies and individuals have registered with the Malaysian Timber Industry Board (MTIB) as Karas tree planters (for the production of agarwood), involving 2,398 hectares and 2.3 million trees.

“A total of 13 companies have registered with MTIB as agarwood exporters and importers, 22 companies and individuals as manufacturers while over 50 agarwood product businesses have been identified nationwide,” he said.

Mohd Khairuddin said this to reporters during his visit to the Oud Agarwood Enterprise’s agarwood essential oil production facility in Kampong Bukit Tok Ali, Kuala Balah yesterday.

Malaysian Plantation Industries and Commodities Minister Datuk Dr Mohd Khairuddin Aman Razali during his visit to the Oud Agarwood Enterprise’s agarwood essential oil production facility in Kampong Bukit Tok Ali, Kuala Balah. PHOTO: BERNAMA

Also present was Oud Agarwood Enterprise’s Deputy Director Mohd Ruslan Osman.

Mohd Khairuddin said last year, the local agarwood industry’s exports stood at MYR8.8 million – a modest amount in the billion-ringgit global market, given the fact that it is one of the popular ingredients in perfume production.

As such, the minister said he will be applying for some allocation under the 12th Malaysia Plan to assist the industry’s expansion at the plantation and downstream levels.

“The MTIB has a unit dedicated to train those who are interested in processing agarwood, and entrepreneurs can also be trained in perfume production,” he said.

Meanwhile, Mohd Ruslan said his family had started the business in 2012, producing agarwood essential oil for the international market.

“Five tonnes of Karas wood can produce about three litres of agarwood essential oil, and the average price of one kilogramme of the oil is around MYR20,000 to MYR30,000, depending on the quality and grade,” he said, adding that last year, the company produced about 20kgs of the oil.