Aroma Trading Limited

Market Report April 2004

Cocoa Butter
While lecturing recently to an aromatherapy group, the subject of 'Fair Trade' came up. Briefly, in the UK there is an organisation which tries to help promote the development of small producers of coffee beans, cocoa beans and other staples, by selling via supermarkets and other commercial concerns under the 'Fair Trade' Label, whereby a percentage of the selling price goes back to the farmer on the ground.

I applaud the effort and the work this organisation is doing. However, it stops there. "What about the next step?" I ask the audience. When you look at the pennies these people get in comparison to the profits the coffee companies and supermarkets make, it adds up to a pittance.

The next step must be to make sure some of the value added profit remains in the producing country. The World Trade Organisation, among others, is stopping this from happening with preventive tariffs. Take cocoa as an example. Both Europe and the US can import cocoa beans tax free. If the poor exporting countries process their own beans into Cocoa Butter, they pay 10% tax to import into Europe. If they process into Cocoa Powder, the tax increases to 15%, and if the Cocoa is processed into Chocolate, the tax is a massive 20%.

So Germany processes more Cocoa than Ivory Coast, the world's largest producer. The UK grinds more Cocoa than Ghana. And the developing countries produce in excess of 90% of the world's cocoa beans but less than 5% of the chocolate. If even a quarter of the cocoa beans were processed at source, think of not only the revenue it would generate for the producing countries but also the amount of fuel saved that is presently used by vessels used to transport the cocoa beans to Europe and the US! We could all have access to cheaper chocolate and make a difference to the environment

Geranium Oil
Price of Egyptian Geranium Oil is starting to come down, and it is only about US$ 5.00/kilo higher than Chinese Oil at the moment. Some re-sellers are claiming that a lot of the Geranium Chinese on the market has a very low level of Geraniol, about 2% only. Our stocks of Geranium Chinese have in excess of 7.2% Geraniol. The new Chinese crop has commenced production so expect price to fall further.

Sandalwood Oil
Price has increased a further US$ 15.00/kilo this week, as buyers take available parcels off the market. Although available quantities of Indian Sandalwood Oil are limited, we still have a good stock position.

Juniper Berry Oil
All stocks at origin now sold, and with no crop this year, we expect prices to exceed US$ 200.00/kilo for volume quantities.