Essential Oil Market Update

2010 is starting out to be a year where weather dramatically effects essential oil crops and production. We already are seeing higher prices for many of the essential oils from China due to the drought effecting the crops growth and the government prohibiting water from being used at the distillation facilities. This effects Eucalyptus Globulus, Geranium, Ginger, Litsea, and Valerian. The Eucalyptus crop alone is seeing a 40% drop in availability compared to last year. Rains and frost have had a large impact on the citrus crops this year and are effecting Petitgrain, Orange, Lime, and Lemon oils, which are all seeing slightly higher prices. Grapefruit is also slowly drifting up in price even though there is low demand. Tangerine oil is holding flat in price in spite of the El Nino effect but Clove is increasing in price because of a shortfall in production by 15%. Bulgarian Lavender has been effected by poor weather and disease which is resulting in production being 50% of normal, thus raising the prices for the shortage. We also are seeing higher prices due to conditions not related to weather such as higher production costs in Indonesia. This is effecting Clovebud, Nutmeg and Patchouli oils. Lemongrass is trending higher because of adulteration coming out of some of the facilities in India. India's production shortfall of 20-30% is effecting Cardamom but prices seem to be holding steady at this time. Coriander, Cinnamon, and Rosewood are all likely to go higher because of shortages in supply. As we receive further updates we will post changes.