Opportunities for the smallholder sandalwood industry in ... - ACIAR

Introduction
Sandalwood (Santalum spp.) comprises 16 species
distributed across India, Indonesia, Papua New
Guinea, Oceania and Australia (Applegate et al.
1990; Harbaugh and Baldwin 2007). Sandalwood
trees are highly valued for their fragrant heartwood
oil, which has been used for centuries for religious
and customary purposes, and is still used for cosmetics,
aromatherapy and perfumery (Yusuf 1999). The
heartwood is also used for ornamental or ceremonial
carvings, or powdered for the manufacture of incense
and other products valued in the international agarbatti
market (Doran and Brophy 2005). Seven species
are currently used commercially, but the high demand
for sandalwood products and the lack of commercially
produced sandalwood have culminated in a
sharp decline in the natural supplies of many species
(Bulai 2007; Butaud and Mallet 2007; Rimbawanto
and Haryjanto 2007; IUCN 2009).
Santalum austrocaledonicum is indigenous to
New Caledonia and Vanuatu, and is commercially
important in both countries. In Vanuatu, sandalwood
harvesting is the primary source of income in many
villages and supports both rural and urban employment.
The harvest of sandalwood from natural stands
was the first export industry in Vanuatu, commencing
in the 1820s, and continues to be a major source of
export revenue. Currently, there are two sandalwood
oil distilleries in Vanuatu that buy wild-harvested
wood from custom landowners and export both raw
and processed product (Lui and Smith 2007). This,
however, has involved extractive harvesting from
natural stands, which has led to a serious reduction in
the wild resources (Gillieson et al. 2008). The species
is known to be amenable to agroforestry production
(Corrigan et al. 2000), which, if widely adopted by
rural communities, could alleviate harvesting pressures
on wild stands while developing an economically
significant smallholder industry.
The aims of this study were to:
• determine the extent of sandalwood plantings
and identify opportunities and constraints for its
further development
• determine the feasibility and profitability of the
sandalwood plantation industry to smallholders
and other participants
• evaluate alternative strategies for financing planting
activities by smallholders
• present marketing options for sandalwood, including
sapwood by-products
• define government policy initiatives to facilitate
the development of the industry
• define a promotion strategy and information package
for current and potential growers and investors.
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