Sandalwood oil valued at Rs.5 crore is remaining unsold at the sandal depot at Marayur owing to poor demand from buyers. The sandalwood factory was opened in the public sector after it was found that private factories were buying sandalwood from smugglers. The factory which was opened five years ago has now stopped producing sandalwood oil.
Sources at the Marayur sandal division said the factory had remained closed for a year. Though the outlets of the Forest Department sell sandalwood oil, the quantity is meagre.
The factory had produced nearly 200 kg sandalwood oil using 600 kg of sandalwood. However, only a half of the oil could be sold over five years. The sandalwood oil was sold in five millilitre and ten millilitre bottles at the rate of Rs.1,500 and Rs.3,000.
It is said that the ban on sandalwood oil imposed by European countries had affected the market.
However, there is a huge domestic market for the oil, which could have been tapped. Moreover, there is no ban on value-added products using sandalwood oil by the European Union. Had these segments been tapped, the factory could be made functional, said sources. The factory had provided employment for many tribal people and the oil produced was natural and pure. In the closed factory, the equipment and machineries are remaining unutilised, they said.
Factory was opened five years ago
EU-imposed ban pulls down demand
