Sandalwood plantations in WA ramping up production

Sandalwood is a native tree in Western Australia, and the harvest and export of the spicatum species grown in semiarid regions of the southwest was an important contributor to the early development of the Western Australian economy over 100 years ago. In more recent times, several private companies including Santanol and Quintis (formerly TFS) have planted sandalwood varieties in a climatic sweet spot running across the far northern Australian outback. In the process they have become two of the world’s biggest growers of plantation sandalwood trees.

For these companies 15 years of patience is about to pay off as their plantation approach maturity, more than a decade after they were planted. Santanol manages about 2,200 hectares of sandalwood in Kununurra, in the Ord River Irrigation Area. It first harvested trees in 2014 and is selling “tons” of oil a year, said Remi Clero, Chief Executive Officer of Santanol. “When you create a fragrance, a formula, you need to be able to give to your customers a consistent product,” Santanol’s Clero said. “They need to be able to do deals with companies like ours for 10 years or more of guaranteed supply.”

India has historically been the dominant supplier but sales from government auctions have plunged in recent years. The demand from new sectors, dwindling Indian output and the difficulty of replicating the maturing Australian plantation trees, has Quintis confident in the future. Quintis plans to increase production from its 12,000 hectares of plantations located in a strip of land running through the northern parts of Western Australian, the Northern Territory and Queensland, that includes 5500 hectares in and around Kununurra.

Quintis manages about 5.4 million trees maturing at different stages and completed its first commercial harvest in 2014, according to its website. The trees, which need a host plant to help them get water and other nutrients from the soil making them semi-parasitic, are harvested whole. Quintis uses almost the entire tree, selling oil that it refines at its Mount Romance distillation plan, as well as wood chips, wood powder and resins.

Source: Bloomberg.com. The Australian