A fire in March 1997 in the East Indian state of Tamil Nadu has destroyed most of the year's sandalwood (Santalum album L., Santalaceae) crop, sources report. Although Indonesia does produce some sandalwood oil, most of the product comes out of India. As a consequence, prices for sandalwood oil are sure to rise later in the year when the shortage will begin to be felt in the market. It has been estimated that approximately $17.5 million worth of sandalwood has been affected. "Sandalwood oil will surely rise with this news," says one supplier. "With recent events, this will make it even harder to get natural sandalwood oil."

The oil had already been in short supply outside of India since the Indian government placed sanctions on its exportation in June 1996. The availability of synthetic sandalwood oil kept prices in check at that time, and brokers predicted that the natural sandalwood oil market would recover in a year or two. Due to the recent fire, however, the recovery is no longer expected that soon. In early 1996 East Indian sandalwood oil was selling at $174/pound. By the end of 1996 and into January 1997 the price was as high as $235/pound. Since then the price has leveled out to $215/pound. Prices for the Indonesian product are slightly lower. Due to its different fragrance characteristics the Indonesian oil is not the preference for perfumery. In India cutting of sandalwood trees is not allowed until they are 30 years old, although a black market has risen in trees being sold to distillers of the oil.

[Floreno, Anthony. Sandalwood Oil Faces Trouble as Crop is Destroyed by Fire. 1997. Chemical Marketing Reporter, March 31. p. 23.]

Article copyright American Botanical Council.

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By Ginger Webb