The Future of Agarwood Business in Bhutan

The young teenage boy gets enrolled himself in the school at the age of fourteen. He starts his school as early as 4 am in the morning and gets back home by dusk in late evening or sometimes at night. He does his best and completes fourth grade. He discontinues his studies despite being a bright student to help his aging parents at home. He then joins his eldest brother to earn some money as laborer in Agarwood business somewhere in Assam boarder and Nagaland in India. He promises some gift to his young bride on his return from the forest far away in foreign land. This is the brief story of my hardworking father.

His Agarwood stories of experience in the filed as young man use to thrill me. It was like horror movie story telling when he shared that they once shifted their camp in fallen dried logs to find out later it was a giant anaconda sleeping for long time to capture its prey. As I recall now that I was not matured enough to understand the details of the Agarwood business they did with the Indian counterpart in the deep jungle. He narrated that they used to select the most matured tree and try their luck to find its black trunk. The matured black trunk fetched them a good price. Their luck favored by few trees as they kept hunting one tree to another for months because not all trees get that money trunk.

That was the Agori Tree (he sounded) story I lived with since some two decades ago until I found one in Panbang at late Dasho Nishioka’s residence at Agar Camp near Panbang Bridge. The Agarwood plantation in Panbang must have been inspired by this far sighted Japanese man who had his vision for Bhutan some five decades ago in 1970s but none of us gave a heed. Today, we have his farm land as Agriculture Research & Development Centre (ARDC) and about two hundreds of Agarwood trees probably four to five decades’ old are thriving there. We took all these years to decide for nursery and plantation as we don’t find any planted saplings older than five years in average. Nevertheless, it’s not too late to start than never. We now can find nursery in almost every household in Panbang at Nu.15 to 20 per sapling.

Similarly, the trend of nursery and planation in lower Kheng to Nganglam in the South to Samdrup Jongkhar in the East is gaining its popularity except Samtse in the West. The people of East has somehow expected its good return in future and has invested in good amount and time. The dry lands with most of their orange produce declining each year has been replaced with Agarwood plantation. Some retired senior citizen has planted in large scale in their dryland and also in leased land. These lot of bold entrepreneurs might reap the perfect retirement benefit if they live another decade. However, many older and even younger lot doesn’t want to invest in this time taking project with minimum pay pack period of ten to fifteen years. Thus, few optimistic groups are taking serious in large scale plantation.

The Agarwood is the fragrant dark resinous wood formed in the heartwood of aquilaria tress when they become infected with a type of mold (Phialophora parasitica). The tree produces a dark aromatic resin called Aloes or Agar as infection progress. This resin embedded heartwood contains distinctive fragrance which is used for incense, medicine and perfumes. The natural formation of aloes or agar is only about 7 out of 100 Aquilaria trees and a common method in artificial forestry is to inoculate tress with the fungus (Wikipedia). We do have most probably Aquilaria Malaccensis or Aquilaria Agallocha species in Bhutan which is world class and considered best in international markets (Kuensel, December 1^st, 2015).

The growers are obviously opting for inoculation rather than waiting for natural formation which takes at least 20 years. While, the inoculation brings down the harvest time almost halves of it to 8 to 10 years at the max and some aspiring investors are expecting in 5 years’ time which might be too optimistic target. Some Foreign Direct Investment (FDI) was interested to invest in Bhutan few years’ back but pandemic destroyed the plan. They wanted to inoculate in 6^th year tree and harvest after two years in 8^th year at $230 per tree which might be similar to Hazelnut agreement by Mountain Hazelnut Venture (MHV). While, our own private entrepreneurs are trying bold to inoculate in 3^rd year and harvest after two years in 5^th year which may inspire many growers if it is successful. In price also they are planning at lucrative rate of Nu. 10,000 per kilogram to the growers. However, the growers need to bear the inoculation charges of Nu.800 to Nu.1200 per tree if they want to inoculate in 3^rd year as the inoculation charges goes up for bigger or matured trees.

What makes many growers still doubtful on this long term investment is less expertise on nursery for large scale planation and the market at end. However, the Green Bhutan Corporation Ltd. (GBCL) may soon guide and lead the growers in large scale nursery. The existing nursery growers are putting their indigenous knowledge to collect the local seed from the mother trees and grow in small polythene bag. Some grow in mother bed and later transplant it to poly bag. Some even prefer to let it grow under the mother tree soil bed and transplant it in the poly bag later. The seed and sapling adapt only in natural topsoil and clay without any compost or cow dung manure and fertilizers. The seed can germinate within 2 to 3 months and grow to about 10 to 15 cm tall in another few months. The sapling can be planted in the field by June and needs care where some insects attack the young leaves. It needs to be treated with some insecticides spray which is not preferred but the pest control must be there for proper growth of the saplings. One can choose the desired plantation pattern keeping sufficient space in between ranging from 2 meters to 5 meters’ distance. The saplings can grow up to 8-foot tall in 18 months in favorable soil condition and southern elevation.

The artificial inoculation also yet to be fully successful and today there are few private individuals with permits who are carrying out the inoculation on trial basis. Some growers are reluctant to inoculate as their trees are dying with probably different grade inoculation chemical used by the suppliers. The domestic market in traditional medicine at Nu.70 per kilogram doesn’t impress growers (Kuensel, December 1^st, 2015). We may have potential numbers of trees around one lakh plus for the inoculation in next five years and would start production in 10 years from now for export. Thus, the growers and investors are hopeful that our Research and Development Centre (RDC) would soon present credible proof on its commercial viability in international market in near future with the export permit from CITES (Convention on International Trade in Endangered Species of Wild Fauna and Flora).

The value addition in the product with processing unit in Bhutan in future would add more value to our fragile economy. We may add to our private forest list even if we fail to harvest for international market. We may add to the green forest repository in carbon sequestration to be a Carbon Neutral country in all times to come. Above all, we will be able to conserve it from its IUCN Red List of Critically Endangered category. If every one of us plant a single agarwood tree in a Social Forestry Day on 2^nd June every year that will keep us away from the extinction list where some country has already lost its habitat.