Market Observation

Report
May 2018
  Basil Oil
 Holy Basil Oil
 Citronella Oil
 Eucalyptus Globulus Oil
 Frankincense Oil
 Ginger Oil
In this issue 

Lemon grass Oil
Palmarosa Oil
 Peppermint Oil
 Vetiver Oil
 Anethi Seed Oil
 Turmeric Oil
 Nagarmotha Oil
Basil Oil
Supply pressure is observed in 2018 due to no carry over supply from 2017.
Seeing the situation farmers have taken advantage and started asking for
unrealistic prices. It was a bizarre situation where the market needed oil but was
reluctant to buy at such prices. With such increase cost will probably drive down
future demands.
Application of Linalool Ex. Basil has risen widely which has led to increase in its
prices 10 times over the last decade but the demand for Methyl Chavicol did not
seems to be at paced, this has led to surplus production and to utilize this stock
some distillers have started blending cheaper linalool from synthetic route and
selling it as Basil oil.

Price Basil Oil $15/Kg

Availability: Ex-Stock up to 2MT

Holy Basil Oil
Unfortunately, the production was low compared to year 2016. The market
continues to be difficult due to weak supply of this oil. Small production lots and
small collection have increased its costs significantly which in return will drive
drown demand further.
Researchers at Indian Council of Agriculture research’s (ICAR), Directorate of
Medical and Aromatic Plants research (DMAPR) were able to discover a better
and cheaper way of producing eugenol from holy basil which can turn out to be a
game changer. It will also increase the availability of eugenol whose demand is
seldom met through natural sources, leading to artificial synthesis.

Price Holy Basil Oil $61/Kg

Availability: Ex-Stock- 200 kgs

Citronella Oil
The global market for citronella is very high for various applications ranging from
aromatherapy, mosquito repellent products, industrial cleaning products and etc.
Demand being high from FMCG Sector with poor supply because of fewer yields,
are causing problems for anyone who does require this oil.
The cyclone storm (Ockhi)brought heavy rains in few cultivating parts of India
which in return damaged the crops to wide extent. Post this many farmers
switched to food crops and those farmers who had stock were able to supply but
at a very high price.
Should supply return in the next few months we may find relief in prices.

Price Citronella Oil $28/Kg

Availability: Ex-Stock- 2MT

Eucalyptus Globulus Oil
Changing climatic conditions and strict environmental regulations was a setback
for farmers in 2017.
According to reports due to limited quantity of oils prices of Eucalyptus were
breaking records and we do not see any ease at it.
The rate of decline in production continues with many producers not able or
willing to offer material.
Prices continue to remain concrete with possible chances of increase owing to
little or no availability of products coming to market. While there has been
attempts to use low quality hybrid eucalyptus it has met with little success due to
terpenic top note.

Price Eucalyptus Globulus $30/Kg

Availability: Ex-Stock- 5MT

Frankincense Oil
Frankincense comes under wild harvest with its main Sources in India at Madhya
Pradesh, Jharkhand and Chhattisgarh. The main application lies in production of
boswellic acid which is a pharmaceutical active used in ointments as an anti-
inflammatory substance and incense sticks.
Five years ago export of boswellia serrate was very low but now the scenario has
changed with frankincense topping the charts of essential oil listed globally with
India being the largest exporter.
As frankincense is collected from the wild, the forest cover is depleting rapidly all
over India and domestication of frankincense as a plantation crop is not yet on the
cards of any research institute.
Joint-forest management has been introduced by the forest department which has
to some extent stabilized the gum production and ensured sustainable tapping of
tree for its resin.
Gum collection will continue till arrival of Monsoon.
The availability and prices have increased since past 3 months.

Price Frankincense Oil $55/Kg

Availability: Ex-Stock- 2MT

Ginger Oil
Ginger oil holds strong demand from domestic as well as
international markets. Year 2017 saw a steady rise in price due low
production of yield. Many variations of ginger coming from different
parts of India also raised a concern regarding quality, since many of
them have low zingiberene content. Standardisation cost is too high
but parallelly low cost rectified material also stays in demand. 2018
starting on a more positive note the market appears to be more
balanced.

Price Ginger Oil $122/Kg

Availability: Ex-Stock- 200kgs

Lemongrass Oil
Lemongrass oil supply chain is facing its major challenge in recent
years after close to 10 MT oil procured in December & January found
to contain phthalates ranging from few ppm to up to 0.4%.
While some experts in the industry mentioned the reason for
contamination was re-use of containers but our assessment says it’s a
mischief played by a stakeholder of the supply chain to disrupt
shipments and block working capital of existing exporters.
While the stakeholders are now on the hunt of the culprit and are
scanning every purchases more carefully which will have negative
impact on the overall lemongrass oil business in India.
Second factor that came in picture was crop yield affected by drought
and market price took a fair leap. For now, the supply is fairly stable
and demand is increasing. Year 2018 will face some increase in
demand due to lack of synthetic Citral in market.

Price Lemograss Oil $24/Kg

Availability: Ex-Stock- 900kgs

Palmarosa Oil
There has been little material in the market since the start of the 2016
due to heavy rainfall affecting the plantations which increased the
price to which farmers were interested to cultivate in 2017. Demand is
stable and cultivation have improved slightly. Seeing the situation
improvised variety of palmarosa and agro technologies by CISR-
CIMAP have been made available to large amount of farmers in
different part of country.
This crop can be grown in marginal and underutilized land ensuring
better returns to the farmers comparative to other crops. (Ref: CSIR-
CIMAP)
Global Palmarosa Oil sales is expected to increase by 20-45%. Due to
poor crop in 2016 supplies had been short and in 2017 there was no
carry over supplies. Hence prices may continue to be

Price Palmarosa Oil $52/Kg

Availability: Ex-Stock- 540kgs

Peppermint Oil
2015-2016 Mentha oil markets remained quite stable but 2017 changed
the scenario of peppermint oil with exponential increase in prices.
Supply v/s demand difference is clearly evident with tight stock due
to restricted supplies from producing region.
Due to impact of demonetization, sowing was affected as many
farmers were not able to buy planting materials. Post demonetization,
the commodity market started paying farmers in their bank accounts
to which they were disinterested to liquidate their inventory. As they
were not getting the best money in return of crop the production
started decreasing.

Organic:
Price: Peppermint oil $40/Kg
Availability: Ex.Stock - 900-1200 kgs

Conventional:
Price: Peppermint oil $31/Kg
Availability: Ex.Stock - 1600 kgs
Vetiver Oil
Seeing the demand of International vetiver oil, farmers are
encouraged to plant CIM-Vriddhi which is equivalent to Haiti
Origin. There is moderate increase in vetiver Oil North Indian
(KS1 Khus Variety) which is similar to North Indian Khus.

Domestic prices being high does not attract international buyers

but have restricted domestic buyers from the international
supply due to import duties.

Price Vetiver Oil $475-490/Kg

Availability: Ex-Stock- 50-100kgs

Anethi Seed Oil
It’s been an interesting start for Dill seed oil that is produce in the
sub-tropical and temperate regions of India precisely in
Northern and Central parts. With rising demand from
international markets, India’s Spices board has included Dill seed
oil in the list of spices from March 2018. With such escalation,
government are encouraging and supporting farmers by offering
them subsidies. Prices are expected to rise in near future.

Price Anethi Seed Oil 45 /Kg (.Dillapiole free oil)

Availability: Ex-Stock- 800-1000 kgs

Turmeric Oil
The production of Turmeric oil has deteriorated due to significant
drop in sowing due to drought like situations in South. As per
market estimate these fall in production will be compensated from
regions such as Uttarakhand, Andhra Pradesh and Maharashtra.

Expectation of demands are slowly picking up with new arrivals of

crops. However short-term market for turmeric oil still looks poor
but rise in export and domestic demand from north India (as
predicted) will recover and will be a good opportunity for medium-
sized buyers.

Price Turmeric Oil US $ 20/Kg

Availability: Ex-Stock- 200-300 kgs

Nagarmotha Oil
Nagarmotha (Cyperus scariosus) rhizomes collected from different
locations in India majorly from Madhya Pradesh and Chhattisgarh is
used in perfumery compounds and manufacturing of Hair care, skin
product, ayurvedic medicines and incense sticks (Agarbatti). This oil
continues to be in high demand in European countries with 75%-
85% being exported and the remaining is utilized in the domestic
market. From past 3 years production and prices are consistent of
Nagarmotha Oil.

Price Nagarmotha Oil US $ 220/Kg

Availability: Ex-Stock- 400-500 kgs

Thank You