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Why are wild agarwood chips becoming increasingly expensive?
Hello everyone! If you have a habit of buying agarwood chips or powder, and you didn't buy them before 2003, you'll find that agarwood prices are getting more and more expensive!!!
First, let's put aside the issues of oil filling and making "hand-made" agarwood... Recently, I've received a lot of "hand-made" agarwood chips from netizens (they say they're using them as buying experience, shrug).
1. Agarwood takes hundreds to thousands of years to form... so whatever is harvested is lost. Wild agarwood is hard to come by, unlike flowers or rice which mature and are harvested seasonally (farmers work very hard in cultivation). And other products, after processing...
2. Agarwood is being heavily extracted for its resin... this is terrifying! 8% resin extraction... 100 kg of agarwood only yields 8 kg of resin!!! These oils supply the base oils for the global cosmetics industry, and these large companies' demand far exceeds agarwood production by hundreds of times. Agarwood is already being pre-ordered locally...
3. International demand for agarwood also includes many oil-producing countries... They use agarwood oil extensively for religious purposes and due to different social cultures.
4. The economic rise of mainland China has led to many high-quality agarwood pieces acquired in Taiwan being sent there to sell for good prices (high local taxes increase the cost of agarwood), resulting in many agarwood streets in the region now... The result is the main reason for the current soaring prices! Some netizens have asked: Is it artificial speculation driving up prices? It's possible, but not entirely true. For example, gold used to cost over NT$1,000 per coin, but now it's over NT$4,000. Would you sell it for a little over NT$1,000?
Because there's demand for agarwood, it will circulate. If no one wants it, the price will naturally fall, just like stocks and gold! However, agarwood rarely drops in price, mainly because wild agarwood takes a long time to mature! To raise prices, the economy needs to be strong enough to withstand the consumption of major international countries. If there's still wild agarwood available...
The above explanation is purely my personal opinion.
First, let's put aside the issues of oil filling and making "hand-made" agarwood... Recently, I've received a lot of "hand-made" agarwood chips from netizens (they say they're using them as buying experience, shrug).
1. Agarwood takes hundreds to thousands of years to form... so whatever is harvested is lost. Wild agarwood is hard to come by, unlike flowers or rice which mature and are harvested seasonally (farmers work very hard in cultivation). And other products, after processing...
2. Agarwood is being heavily extracted for its resin... this is terrifying! 8% resin extraction... 100 kg of agarwood only yields 8 kg of resin!!! These oils supply the base oils for the global cosmetics industry, and these large companies' demand far exceeds agarwood production by hundreds of times. Agarwood is already being pre-ordered locally...
3. International demand for agarwood also includes many oil-producing countries... They use agarwood oil extensively for religious purposes and due to different social cultures.
4. The economic rise of mainland China has led to many high-quality agarwood pieces acquired in Taiwan being sent there to sell for good prices (high local taxes increase the cost of agarwood), resulting in many agarwood streets in the region now... The result is the main reason for the current soaring prices! Some netizens have asked: Is it artificial speculation driving up prices? It's possible, but not entirely true. For example, gold used to cost over NT$1,000 per coin, but now it's over NT$4,000. Would you sell it for a little over NT$1,000?
Because there's demand for agarwood, it will circulate. If no one wants it, the price will naturally fall, just like stocks and gold! However, agarwood rarely drops in price, mainly because wild agarwood takes a long time to mature! To raise prices, the economy needs to be strong enough to withstand the consumption of major international countries. If there's still wild agarwood available...
The above explanation is purely my personal opinion.
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