As promised, here’s the second part of Trend Spotter;
The oil which is extracted and refined from the agarwood is witnessing a growing demand, especially in the Middle East. Prices are reflected by demand and demand is high as the oil is used for making perfumes and the fragrances used in cosmetics and is considered one of the best by many.
Thailand is expanding its production of Aquilaria trees, because they see the rising demand for what the locals refer to as oud (agar).
If you’ve traveled extensively, you have probably run across agar, but were unaware of it at the time.
The pharmaceutical industry in Japan uses agarwood and in Europe it is common in cosmetics. In fact, agarwood is a very common raw material component in joss sticks.
A litre of premium agar can fetch as much as $20,000 or more.
You ask; why all of sudden is there going to be a trend involving agarwood?
Here’s the meat of the trend story. Commercial production of agar was strictly prohibited by the Thai government for hundreds of years, but just a few years ago, the trees that produce the desirable agar resin were taken off the protected plant list in the Kingdom of Thailand. This was done after the government realized the money that could be pumped into the Thai economy if they allowed the production of oud commercially.
It’s been seven years since the ban was lifted, but it’s taken those years to grow the trees and more are being planted regularly, but plantations which grow the trees require large capital investment.
To put this in perspective; it takes anywhere from ten to forty years for a tree to mature in order to produce the premium oud, but artificially cultivated oil can be extracted from a tree in as little as three years from the tree’s planting.
It’s in the same realm of thinking as pearls. There are pearls which are produced over time and then there are cultured pearls which were first created by an industrious Japanese man.
The premium resin would come from trees that took those ten to forty years to mature, while the lower priced and still desirable oud came from essentially infecting the younger trees with the fungus.
True, you may not consider this to be a trend that you’re going to jump on by growing your own trees, but your thinking should follow the following steps;
- Who uses agar oil?
- Can it be purchased in bulk and resold in smaller portions?
- Is there a duty on this item? If so, how much and how is it determined?
- Is there money in just being a middleman (distributor)?
- Can I create a mystique about the item by writing a tale of its heritage and usage?
- Which ceremonies call for the use of the oil?
- Should I try a line of my own oils and fragrances which feature this oil and its properties?
- Who can I partner with to put this together?
- Perhaps I could just make or import decanters or scent bottles for this oil and never deal in the oil itself.
- Who near me has the oil, so that I can smell it and learn more about it?
- Is there a similar product that I should be investigating?
- Do I watch this trend develop or do I get involved somehow?
- If I ran an ad in an industry publication (cosmetic/fragrance) what sort of response would I get? Of course, it depends on what your ad promises, asks for, or offers.
I like to keep my eyes open for trends that are developing, but hidden in plain sight. Honestly, before you read this article, did you ever hear of oud, agar, or agarwood?
Stay tuned, I’m always looking for trends and ways to spot them.
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