Albany firm signs contract with CALM for sandalwood supply

3/3/99
A Western Australian company that successfully launched emu oil to the world's cosmetics and therapeutics industry has embarked on a new venture that will put the State to the fore as the leading supplier of another native oil - sandalwood.
Environment Minister Cheryl Edwardes said Albany-based Mt Romance Australia Pty Ltd had signed a contract with the Department of Conservation and Land Management (CALM) for the supply of up to 1000 tonnes of sandalwood a year. The value of the contract is conservatively valued at $40 million over 10 years.
Mrs Edwardes announced details of the contract at the official opening, by Deputy Premier Hendy Cowan, of Mt Romance's new sandalwood oil factory in Albany today.
Mr Cowan said the venture would have major long-term benefits not only for the State's sandalwood industry and natural environment, but for regional economies such as those in Albany.
Mt Romance was awarded the contract following a nation-wide call for expressions of interest in the production and marketing of sandalwood oil.
Mrs Edwardes said the company was selected from a very competitive range of proposals. The selection criteria addressed several points including the location of processing facilities, competitive pricing, technical and marketing expertise, and the quantity of sandalwood to be processed.
"Mt Romance has an active research and development program that is continually identifying and creating new sandalwood-based products," Mrs Edwardes said.
"Although the main focus is on the cosmetic and therapeutic uses of sandalwood, the company's long term aim is to become a major supplier of sandalwood oil to the international perfume and pharmaceutical industries."
Mrs Edwardes said the contract also opened the way for the development of a stronger domestic market for sandalwood oil and products, not only in Western Australia, but in Australia as a whole.
Essentially this would be a 'new' market for sandalwood products which were ironically one of the first, if not the first, export of the Colony of Western Australia
The Minister said the contract represented the realisation of a policy of value adding to WA sandalwood in this State wherever possible. It also would complement our traditional markets in Asia.
Mrs Edwardes said the announcement of the contract would provide an incentive for farmers to incorporate sandalwood into their tree crops programs.
"CALM has developed new techniques which make it possible to grow sandalwood as a tree crop," she said.
"Sandalwood is now one of the major supplementary species CALM is offering farmers who establish maritime pines under the State Salinity Action Plan.
"Apart from its economic value, sandalwood planting contributes to the restoring of the biodiversity of the Wheatbelt because it occurred naturally before clearing for agriculture."
It is expected that a further 50 ha of sandalwood would be established this year on cleared farm land as part of the maritime pines project.
Media contacts: Ministerial - Nicole Trigwell 9421 7777
CALM - Dr Syd Shea 9442 0325