Global Demand Trends
- The global market for agarwood products (chips, wood, essential oils) is growing robustly. According to one estimate, the overall global agarwood market value in 2025 is around USD 14.2 billion.
- For essential oils derived from agarwood, the 2024 market value is estimated at USD 140.9 million, and it is forecast to climb to USD 224.6 million by 2034.
- The growth is largely driven by increasing demand in sectors such as luxury perfumery, incense, aromatherapy, wellness products, traditional medicine, and personal care / cosmetics.
- There is rising consumer preference globally for “natural, organic, sustainably-sourced” ingredients. This boosts demand especially in markets with growing wellness, aromatherapy, and clean-beauty trends.
- Regional demand remains strong in several key areas: historically strong demand in Middle East and East Asia (for incense, cultural/religious use, traditional aromas), but Western markets (North America, Europe) are also growing due to interest in luxury perfumes, wellness, and alternative medicine.
Implication for you: As you are considering plantation, extraction, and aromatherapy-based ventures, the global demand tailwinds look favorable for the next 5–10 years.
Supply Trends & Sources — Wood, Chips, Plantation vs Wild
- Historically, a large portion of demand came from wild-harvested agarwood, because wild-sourced agarwood is generally regarded as higher quality (stronger fragrance/resin content) — and commands premium prices.
- However, since about 2017, the trade has increasingly shifted toward artificially-grown / plantation-based supply, as plantations of agarwood species (especially Aquilaria spp.) have been established globally.
- The shift to plantation supply helps address sustainability concerns (wild overharvesting, species depletion, regulatory pressure), but demand for wild-sourced agarwood remains high, especially among buyers seeking premium-grade “natural” agarwood.
- For plantation-based production, yield and quality depend heavily on factors like inoculation protocols, resin development, resin content, and gestation/harvest cycles (trees may need several years before quality heartwood develops).
Implication for you: Your business plans involving plantation-based agarwood are aligned with global supply trends — but you must carefully manage protocols (e.g. inoculation, resin induction) to produce quality agarwood that can compete with wild-sourced supply.
Price Trends & Market Value per Product Type
- According to published data, worldwide agarwood chips prices — depending on quality, resin content, origin, and demand-supply dynamics — can range broadly: USD 20 to USD 6,000 per kilogram for wood chips.
- Premium-grade natural agarwood (“high oil/resin content, possibly wild-sourced”) can fetch extremely high prices — some estimates suggest up to USD 10,000 per kilogram for high-grade wood.
- For essential oil derived from agarwood: while global market valuations are lower (hundreds of millions USD), price per unit volume can still be high due to the rarity and labor/processing needs.
- One field report (focusing on online trade and seizures) noted agarwood pieces (likely small wood chips or fragments) priced at PHP 40,000 to PHP 300,000 per kilogram (which corresponds roughly to USD 782–5,865 per kg) in the Philippines context.
Implication: There remains high value for premium-grade agarwood — especially if you can produce wood/oil/chips with high resin content and good fragrance profile. However, quality classification and provenance (plantation vs. wild, resin grade) will significantly influence price.
Outlook — Growth Drivers and Challenges
Drivers
- Rising global demand: The overall agarwood chips market is projected to grow at a strong rate (several reports show a Compound Annual Growth Rate — CAGR — of ~7–8% over coming years).
- Growth of wellness, aromatherapy, natural cosmetics, and luxury fragrance industries worldwide, which favors agarwood-based oils and products.
- Shift toward sustainable/plantation-sourced agarwood — addressing supply constraints, environmental concerns, and supporting long-term scalability of supply.
- Improvements in extraction technologies and value-adding processes (e.g., refining oil, quality control, certifications) — which can enhance yield, consistency, and market acceptability.
Challenges / Risks
- Despite plantation supply expansion, a portion of buyers — especially in luxury segments — continue to prefer wild-sourced agarwood for perceived superior quality.
- “Quality vs quantity” tradeoff: plantation-derived agarwood may not always match the resin content, fragrance complexity, or market value of the best wild-sourced wood.
- Price volatility: Because agarwood value depends heavily on grading (resin content, aroma strength, origin), prices can vary widely — which adds uncertainty to yield and revenue forecasts.
- Regulatory and sustainability pressures: Over-harvesting of wild trees, CITES/ conservation restrictions — supply must rely increasingly on plantations and sustainable practices, which may increase production costs.
Relevance & Strategic Implications
- The growth in global demand supports long-term viability of large-scale agarwood plantations.
- The shift toward sustainable / plantation-based supply aligns well with your business model (farm-based production).
- High value for premium-quality agarwood (wood or oil) suggests strong upside, especially if you invest in quality (inoculation protocols, resin induction, proper harvest cycles).
- Your plan to offer value-added products (essential oils, perfumes, aromatherapy blends) through ANOC can capture a growing segment of the market, beyond just raw wood/chips exports.