The Cajeput market has most recently been affected by the fluctuation in supplies of Eucalyptus. Consumer brands (ex. Eagle Brand in Indonesia) that typically have a large requirement for Eucalyptus oil have turned towards Cajeput as an alternative. This sudden focus on Cajeput has led to increased demand, and also sudden increase in prices.
The market is steady for cananga oil. Inclement weather has affected the harvests in December 2017 and January 2018. Due to the risks involved, as well as lower yields, there is a certain reluctance to make the effort to collect the fallen leaves. Overall production in 2018 is predicted to be lower than last year.
Prices remain firm now; but will tend to surge until new sources are established. In the wake of Van Aroma’s immensely successful launch of its citronella project in Sulawesi, we are confident of displacing Java as the principal producer in the next couple of years. Demand for the oil is strong; but supplies are constrained due to local demand as an insecticide and cleaning ingredient, and citronella derivatives for export. There are also several qualities with variations of citronellol, geraniol, etc. available in the market. Therefore, we strongly advise buyers to base their purchasing decisions on an evaluation of actual samples, and not prices.
Supplies are beginning to ease out, with farmers and distillers turning to clove leaves with the dwindling availability of clove buds and clove stems. Prices have stabilised at source due to less frequent rains in the producing regions. Boosted by robust demand, prices have improved but are not expected to fall to the levels witnessed in late 2016 / early 2017 in the near future.
2018 promises to be a competitive year for massoia bark, and its derivatives. The market is set to witness a lot of churn with new producers primed to enter the market. Market dynamics will be largely affected as there will be competitive pricing backed by advanced technologies that yield superior product quality.
Prices have started climbing as the end of the harvest season draws near. The market has limited stock; and we recommend that those with a stable consumption of nutmeg oil book their requirements soon.
Sulawesi:The March prices of patchouli are a little higher than February rates. While the new harvest has somewhat eased supplies; prices still remain firm because the drying and farm level distillation have been affected by frequent rains. Some producing areas in Central and South East Sulawesi are also currently experiencing damaging floods. Prices remain firm prompted by a healthy demand.
Sumatra:The market is unwavering in terms of no new demand. Consequently, supply sources and prices also remain unchanged. There is a compelling shift in attention to the relatively lower priced Patchouli Sulawesi; as a result we foresee a significant decline in Patchouli Sumatra production in 2018.
Vetiver prices are steadily rising. Currently, there are several grades of oil in the market, distinguished mainly by acid value variations. Lack of communication and complexity of cultivation are the biggest hurdles in the wide scale adoption of vetiver production. Garut retains its position as the foremost vetiver-yielding region, even though some cooperatives in regions in and around Java have begun to cultivate it. Prices of vetiver oil vary significantly due to differential pricing offered by exporters. We recommend that you evaluate samples prior to making a decision solely based on price. The total production volumes of vetiver are expected to remain low in the first half of 2018.
Ultra International B.V.
