Prospects in the Sandalwood Farming in India!

Hello and Namaste everyone, I hope you all are safe and sound. The topic of todays Article is the prospect and scope of sandalwood Farming in India. Although Most of us familier with the idea behind the money associate with the farming. Since we all know its a very lucrative business plan, allow me to help you understand the legal and return on investment associated with it.

History and Legality:

There was a time when India used to be major player in the sector of both growing and exporting sandalwood. Infact we used to be the leading exporter of Indian red Sandalwood in the world,followed by Australian white sandalwood.But with increasing smuggling and illegal trades of the wood,people like Veerappan and some other people emerged as the leading smugglers in india. Believe it or not Veerappan used to be the biggest players in india. While the continued illegal trends The govenmrnt of India had to take some strict actions againt the illegal trade. The cultivation of sandalwood was restricted for the private sector.which resulted in the fall of veerappan along with the supply of red sandalwood from india across the globe. The action also resulted india from being an exporter of sandalwood to importing it. This in turn led the australian sandalwood market to flourish exponentially.

Until 2002, when the government of karanataka intially allowed the cultivation of sandalwood within the state for private individuals. The decision was taken with a condition though. The condition being that the wood must only be sold to the government of India at some pre set prices. This was decided considering the potential threats and missuse. Since then, other states also started to open gates for the private individuals to the opportunity.By far the states like Karnataka,Maharashtra,Andhra Pradesh,Telangana,Bihar,Madhya Pradesh(to name a few) have been seen with maximum growth in sandal production.

Understanding the Wood!

Sandalwood, Although is a money making tree. But do you know the time and patience associated with the production? Let me help you understand the production cycle better. Sandalwood has primarily two varieties in India, Red sandalwood and white Sandalwood,which is suitable to grow in a tropical environment.It is said that loamy soil is the best suited soil for its production. With these things in consideration one must have to wait for minimum 12-15 years for the tree to be ready for harvesting. The pulp of the tree itself takes 7 years to start forming. But let me assure you its not the the pulp or a particular part that is only sold in the market. So we get two type of woods from the cultivation.One is the heartwood(formed as pulp) and the rest of the wood. Both products are sold in the market at huge prices, its just the time associated with it that's exhausting.


Business Plan and ROI.

Coming to the most luring part that what most of you've been thinking and calculating in your head,Allow me to help you calculate the returns.Well how about i quote the numbers by a horticulture department itself to make it look more reliable.well read on! :)
Cost and Profit in Sandalwood Cultivation:
Well,profits in any agriculture/crop depends on many factors.However, Sandalwood farming is a long term and highly profitable crop.Here is a sample project cost and profit scenario in India.One should understand that these things will change region to region and year to year based on market conditions.
For one acre of land,usually the plant density is about 400 to 440(where 10 feet distance is maintained between plants).
Usually Cost per acre depends on many factors like plant cost,labour cost for planting,drip cost,soil working and weed control(at the current market),pests/desease cost and others.
On average one acre of sandalwood plantation cost 6,00,000 INR(Six lakhs Indian Rupees).
Sandalwood heartwood is costing about 6,000 Rs/Kg.
Total yield of 5000Kgs can be expected.
So, total expected price after 15 to 20 years is: 5,000 X 6,000 = 3,00,00,000(3 crore).
Total cost/expenditure + other costs = 6,00,000 INR plus Land cost per acre 20,00,000 INR = 26,00,000 INR
Net Profit can be expected: 3,00,00,000 - 26,00,000 = 2,74,00,000/acre.
Conclusion

Lastly, I'd like to suggest you to make the investment carefully. This would be best if you are willing to wait atleast 15 years. You could plan the crop for future in order to finance your childrens college expenses. This certainly would require you to wait.

That's all Folks,Hope this article was in some way helpful and informative.Until next time.