Indonesian Market Update

As part of our commitment to provide accurate, transparent and up to date market information we are pleased to share this ‘Market Intelligence Report’ from PT Aroma Atsiri.


In recent times the main source of Cajeput Oil was Maluku Island (Buru & Amon) and people were using the traditional method for distillation with a copper condenser to get the green color but due to unsustainable production and the contamination of glycols, most of the market moved to the Java variety.

AAI take an initiative to educate our farmers so that they can use modern techniques of distillation to get a good quality material. Due to this, oil from Java is very rich in its aroma, it’s sustainable and is 100% free from contamination. AAI provides a very good quality oil and fulfilling the expectations of our customers. At the moment supply and prices are stable with prices only varying due to the currency fluctuations.

Arti Sharma, Director AAI

Cananga oil

Cananga Oil has a good presence in the aromatherapy industry since it soothes stress, anxiety, sadness, tension, and sleeplessness. Aging trees and a long dry season continue to yield small amounts of oil and with no new plantations on the horizon supply will remain limited. That said a quiet market of late has kept prices stable.

Citronella oil

Last year the price of Citronella Oil peaked due to the lack of supply for synthetic citral and demand for the same was very high because everyone was looking at citronella oil as a replacement.

When the price was high, almost all of the farmers start planting Citronella, meaning this year the price has dropped significantly because of high production and the improved availability of synthetic citral.

Indonesia has always been a large producer for Citronella.  The production was only from Java but there have been many programs arranged by the government to improve the production for citronella oil and now a lot of new areas have been developed for the same. We can now obtain Citronella Oil from Sumatra, Sulawesi and Kalimantan. The quality has also been improved but due to oversupply, the price has been fallen and is now lower than production costs, hence we’re likely to have seen the bottom price for citronella.

Clove oils

Indonesia is the biggest producer for Clove Oil accounting for over 70% of global production. It is also AAI’s largest product as it represents between 60-70% of our total output of essential oils.

Usually there is Clove Bud Season from May to July. People start focusing on Clove Leaf and Clove Stem by mid of August. As compared to last year, this year’s dry season is much longer. Normally by end of August we could expect the rainy season to have started but this year, the rain is forecasted to start by the end of September or mid of October. The supply of Clove Leaf oil has been much better this year and as a result prices have been lower, but once the rains start, there will be a disturbance in the production and it will for sure impact the supply so prices can start to rise again.

Ginger oil fresh

In Indonesia, Ginger juice used in the traditional drink called “Jamu” which is used by almost all age groups as it has lots of health benefits, therefore local demand is very high. Almost all the processors distill the waste generated after the juicing process to get the oil which is one of the reasons why the quality is lower than the market expectations with low citral content.

AAI has began to work very closely with farmers and processors to get the best quality. From the last 4 months, the price has been stable and outlook is for the same over the next 1-2 months, however we are likely to see a price rise once rainy season starts.

Gurjun Balsam

Gurjun Oil is used as a fixative which has a woody, balsamic aroma.  This is used for cheaper perfumes as a replacement of Patchouli and Vetiver Oil. Gurjun has approximately 70 varieties from all across south-east Asia and each has different qualities of oil as per their individual species. Some species have the main component of alpha-Gurjunene, some have it as alpha-Copaene and some have a combination of both along with the beta-caryophyllene. Last year the price was slightly high due to the long rainy season but this year there is a relief and currently the price is stable.

Kaffir Lime Oil

Kaffir lime leaves are the main ingredient in south-east Asian cuisine due to its aromatic, astringent flavor. Kaffir lime oil is interesting for many applications across various sectors due to its refreshing, exotic lime and sweet aroma. The oil also has some medicinal properties such as antibacterial, antidepressant, antiseptic, antiviral, insect repellent making it very attractive to the aromatherapy market. The price has been stable from last six months and is forecasted to remain so for the foreseeable future.

Massoia Bark Oil

Like Clove & Patchouli, Massoia Bark Oil (MBO) is the soul of AAI and we can provide many grades of MBO to fulfil customer requirements and specifications.  For some time the price and demands are fairly stable and Indonesia is producing the enough material to cover the demand. AAI has invested in the machinery to make our MASSOIA C-10 and C12 from 50% to 95%


Prices have been generally stable and well priced for buyers although a recent increase in spice prices have impacted some producers. That said it is expected that prices will continue to remain at these levels with a good new crop expected in the coming months. That said at AAI we like to average out our cost prices over a longer period to ensure we offer our customers a stable and fair price all year round.

Patchouli oil

The markets are still feeling the effects of the unseasonal heavy rains which impacted Sulawesi in May were 90% of all patchouli grows. Crops were damaged and prices increased. They did relaxed a little prior to Ramadan as farmers needed cash to celebrate the festival and again during August as global demand fell due to summer holidays but prices keep firming during other times as the  availability of raw materials remain low for this time of year. A strong uptake from the market in September, especially around IFEAT could push prices higher so it is prudent to take cover.

New plantings will start once the rainy season begins late September with new supplies online from February 2020. Until then we may see prices rise.

Vetiver oil

Prices had been in free fall since 2018 as additional supplies came online. Some efforts have been made to improve the quality and in recent months the prices have stabilised. We should expect to see prices remain at these levels for the foreseeable future. AAI offer three grades of Vetiver so whether you’re looking for the traditional crude oil or the more refined grades which are closer to other origins we are in a string position to support all enquiries.