NOTICE: Hard copies of the Australian New Crops Newsletter are available from the publisher, Dr Rob Fletcher. Details of availability are included in the
Advice on Publications Available.Bob Colton
Program Leader (Oils)
New South Wales Agriculture
Telephone: 02 6391 3171
Facsimile: 02 6391 3206
Email: bob.colton@agric.nsw.gov.au
Essential oils are volatile oils derived from plants and are usually extracted by steam distillation.
They are distinguished from the fatty vegetable oils, such as canola and sunflower, by the fact that they evaporate or volatilise in contact with the air and they usually possess a strong aroma (the name comes from 'essence').
Essential oils can come from any part of a plant:
The amount of oil extractable ranges from an infinitesimal quantity to as much as 1 - 2%.
Essential oils have a wide range of uses:
The domestic Australian market for essential oils represents only 1-2% of the world market so most producers are likely to be competing on the world market. Many essential oils currently traded are produced in developing, low cost countries and are thus traded at prices which are below the cost at which they can be produced in Australia.
Hence the best strategy in Australia would be to aim for high value, high quality oils at the top end of the market, rather than cheaper commodity oils.
The product should be value-added and targeted into niche markets rather than sold as bulk oil.
Such an approach often works better if incorporated with a tourism enterprise.
In selecting candidate crops, the first step would be to identify oils with market potential, then to determine whether they are adapted to a specific production area, rather than the other way around.
Oils worth $20 to 50/kg or more should be identified since a high value, high quality oil is more likely to be profitable in Australia's high cost economy.
Within the chosen crop, varieties should be chosen which produce the quality the market seeks.
Crops and individual varieties must be matched to the proposed environment. Soil type, altitude, latitude, humidity, day and night temperatures strongly influence the quality of essential oil from a crop.
Crops/varieties which are adapted to mechanised farming systems should be identified.
It is difficult for new producers to enter established markets because end-users are difficult to dislodge from their traditional sources of oil.
A knowledge of essential oil markets and good marketing skills will assist in marketing the product.
Eucalyptus
Uses: Cough/cold remedies, solvents/cleaners
Annual production: 2,500 to 3,000 tonnes world wide; 120 tonnes from Australia
Main producers: China, who sets the world price
Species: Eucalyptus globulus overseas; Eucalyptus polybractea, Eucalyptus radiata in Australia
Markets: Limited demand for higher quality Australian oil since the world market is fully supplied
Price: $6 to 10 per kg; the higher price applies to the higher quality Australian product
Opportunities: Few; boutique production of Eucalyptus radiata on the New England Tablelands in northern New South Wales, with value-adding may be profitable.
Tea Tree
Uses: Antimicrobial use in toiletries and as pure oil
Annual production: 400 tonnes
Main producers: almost all in Australia; adapted to high rainfall, humid, coastal sites with long warm growing seasons, frosts will damage young plants and new growth
Species: Melaleuca alternifolia
Markets: Continuing to expand; 90% exported, mainly to USA and Europe
Price: $45 per kg at the farm gate
Opportunities: Could be grown in warmer inland sites but limited experience at such sites suggests there would be reduced yields.
Lavender
Uses: Oil as soaps, toiletries, aromatherapy; the top quality oil is used in perfumes; dried flowers are used in potpourri and in the craft industry
Annual production: Lavender oi1 300 tonnes; Lavandin oi1 800 tonnes; less than 5 tonnes of this production from Australia; adapted to cool climates (such as the New England Tablelands), neutral soils, with good drainage; the crop is fairly drought tolerant
Main producers: Bulgaria, France, USSR
Species: Lavendula angustifolia (lavender oil); Lavendula angustifolia x Lavendula latifolia hybrids (lavandin oil)
Markets: It is hard to compete with imported oil in commodity markets
Price: Lavender oil $US 42 per kg; Lavandin oil $US2l per kg; since the oil is extracted from the flowers, yields are low (0.4 to 1% by weight)
Opportunities: Boutique production of oil/dried flowers, with value-adding and niche marketing in conjunction with tourism.
Any claims made by authors in the Australian New Crops Newsletter are presented by the Editors in good faith. Readers would be wise to critically examine the circumstances associated with any claims to determine the applicability of such claims to their specific set of circumstances. This material can be reproduced, with the provision that the source and the author (or editors, if applicable) are acknowledged and the use is for information or educational purposes. Contact with the original author is probably wise since the material may require updating or amendment if used in other publications. Material sourced from the Australian New Crops Newsletter cannot be used out of context or for commercial purposes not related to its original purpose in the newsletter
Contact: Dr Rob Fletcher, School of Land and Food, The University of Queensland Gatton College, 4345; Telephone: 07 5460 1311 or 07 5460 1301; Facsimile: 07 5460 1112; International facsimile: 61 7 5460 1112; Email:
r.fletcher@mailbox.uq.edu.au[
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GK; latest update 6 June 1999 by: RF