Endangered natural fragrance ingredient oud saved by investment capital

By Deanna Utroske

- Last updated on GMT

Endangered natural fragrance ingredient oud saved by investment capital

Related tags Investment

A group of associated companies that specialise in agricultural investment projects have plans to further invest in the supply chain of oud and its source—the endangered Agarwood tree.

Capital investment is the funding model du jour for new business innovations and for providing support to start-up companies with significant growth potential.

Asia Plantation Capital Group is putting that model to use for a cause (and a profit): APC acts “as plantation and agricultural investment managers and advisors to several Private Equity Funds that focus on the forestry, farming and renewable energy investment sectors,” ​according to the group’s site.

Popular scent

The latest project for the group is oud oil, an ingredient with a nutty, woody scent used in cosmetics, pharmaceuticals and perfumes. Oud is poised to become an even more popular fragrance ingredient than it has been in the past, thanks to consumer trends.

Experts at Seven Scent issued a report just over a year ago that gave a bit of insight into what’s on trend now and what will be in the coming months.

“The rich velvety and dramatic interpretation of the rose, coupled with intense notes of saffron and oud,” ​ is a combination likely to entice consumers, reported Cosmetics Design (based on analysis by Miri Scott, Seven Scent’s fragrance insight manager) when the company’s report came out.

What the market will bear

The supply of oud oil is apparently limited and not sufficient to meet existing or anticipated demand. “Only 7 in every 100 [Agarwood] trees produce Oud,” ​explains the APC’s press release.

Though, “planting the trees and growing them is relatively easy. The secret lies in possessing the proprietary technology, expertise, experience and production systems through to end product distribution to turn a simple tree from a near worthless softwood, into an oil that is valued at up to US $50,000 per kilogramme.”

Sustainable investing

APC has worked for years to develop a viable supply chain for oud. That is what the group has been pitching to investment managers, funds, private bankers and others across Europe and the Middle East.

“With the fragrance industry being only one of the multiple commercial applications for Oud and the Agarwood tree, the business case is solid, sustainable, and nigh on irresistible,” ​states the APG release. If all goes well, the investors will see a good return and the Agarwood tree will be cultivated to the benefit of both people and the planet.

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