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Why to Invest in sandalwood ?

Sandalwood, the most popular fragrant wood, which is mainly used for the essential oils it contains, it is currently a threatened species and consequently very expensive. Indian sandalwood known scientifically Santalum.It is grown naturally in Western Ghats and a few other mountain ranges like the Kalrayan and Shevaroyan Hills

Commercial cultivationCommercial cultivation

FollowingFollowing this development, large scale private cultivators, individual growers, commercial propagators and cultivators have taken up development of Sandalwood plantations on a large scale. The Sandalwood cultivation has attained industrial proportions in India. Citing few instances of large scale industrial cultivation Dr. Rathore told that the value added products of Sandalwood fetches good price in the overseas and domestic markets. This has spurred a new economic activity of cultivation as well as processing and value addition to Sandalwood. Sandalwood.

In Noida Uttar Pradesh the D.S. Group has laid out a sandalwood plantation in 100 acres and another plantation group Surya Vinayak industries which specializes in Sandalwood value added products has its own Sandalwood plantation.

Australia will have upper hand

But it is also true that the commercial plantations in India will not be ready for cultivation for next fifteen years which means that India will not be able to supply Sandalwood to the industry and the market in the required quantities. Sensing this fifteen years back Australian plantation companies have planted East Indian Sandalwood (Santalum album L.) on 4000 hectares and the plantation was now ready for cultivation.

AccordingAccording to the Managing Director of the Karnataka Soaps and Detergents Limited (KSDL) B.H. Anil Kumar, Australia will be the sole supplier in the world for Indian Sandalwood to the world and value added products for next ten years or so. The KSDL has also developed its own nursery with an annual capacity of 60,000 saplings and farmers and plantation owners were enthusiastic about the scope the Sandalwood plantations

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Domestic Consumption of Sandalwood & Oil

Estimated world production of sandalwood

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Annual Requirements

Future Requirements

Sandalwood Oil

India > 60 tons

Export > 40 tons

Present Production < 90 tons

India > 150 tons

Export > 40 tons

Export ratio

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Official Production of Sandalwood in Metric tons in India

1998-99 750

1999-00 1000

2000-01 1200

2001-02 1400

2003-04 1200

2004-05 1150

2005-06 7502005-06 750

2006-07 400

2007-08 300

2008-09 300

Years Tons

YEAR PRICE(per MT)

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1990-1991 1,78,500

1991-1992 2,66,000

1993-1995 3,32,000

1996-1997 6,12,500

1998-1999 7,77,000

1999-2000 7,70,000

2000-2001 10,81,5002000-2001 10,81,500

2001-2002 12,88,000

2002-2003 19,11,000

2003-2004 20,54,500

Jan 2005 29,85,500

July 2005 32,62,000

April 2006 36,90,785

May 2007 34,43,650May 2007 34,43,650

Dec 2007 37,79,475

Nov 2008 38,50,000

Sep 2009 40,25,000

Aug 2010 55,35,000

yearly price index for sandalwood

Expected Returns

1 unit= 1 acer

1 acer= 250 sandalwood plants

Each sandalwood tree yields on average 35kg to 50kgHeartwood

if we take average yeilding of each tree is 40 kg thenif we take average yeilding of each tree is 40 kg then

250X40=10000 KGS

presenent price per ton=55,36,000/-

total returns by present price would be=5,53,60000/-

The growth pattern of sandalwood tree price from 1990 to 2010 is between 1,78,500 to 55,35,000 rs.

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Company Proposal

Bhishaj Biotech Ltd Started the project with the name of ROYALWOODnear kalwakurthi.

COMPANYS ROLE

1 Company Selects the suitable land for the Sandalwood

2 Company will register the land on the name of the customer

3 Customer is the land owner

2 Company act as an consultant till final harvesting of sandalwood2 Company act as an consultant till final harvesting of sandalwood

PROPOSAl

1 Sharing of Final sandalwood returns on the ratio of 70:30 basis 70% for the customer and 30% for the company

2 Internal crops income like mango and some oter crops will be collected by the Company till final harvesting of sandalwood

For latest costing details of the unit please contact the company.

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