Market Report June 2002

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Camomile Blue Oil
Distillers in Egypt have lowered their prices further to compete with European produced Blue Camomile Oil. However, the Chamazulene levels are quite low at 2-5% in comparison with higher levels and still cheaper prices from European Distillers.

Clove Bud Oil
We are unable to offer Madagascan Clove at this time, due ongoing civil unrest in the country. None of our usual suppliers can guarantee they can ship either by sea or airfreight. This will also have a knock-on effect on other oils like Ylang Ylang, Basil, Vanilla, Geranium and Ravensara.

Eucalyptus Oil
Chinese Eucalyptus Distillation should be underway this month, but no sign of lower prices in the forseeable future. Buyers are still reluctant to order large quantities, as some are of the opinion that Eucalyptus will be available at lower prices in the future. Our Broker feels that any reductions in price will be minimal as there are large stocks in the hands of re-sellers and they are in no rush to sell.

Geranium Oil
No information is available from Egypt with regard to available quantities from the new crop. We hope to have some details in our July report but we don't expect any surprises. Meanwhile, Chinese Geranium production continues to fall year on year. I doubt if we will ever see the crop reaching the peak output of 120 Tonnes last achieved some 15 years ago. Estimates continue to run at about 60 - 65 Tonnes with adverse weather reducing the figure further. We are informed that exceptionally dry conditions will cause an increase in prices in the coming weeks. No doubt the Egyptians will take this into account when setting new crop prices.

Neroli Oil
The anticipated production for Tunisian Neroli Oil should exceed 500 kilos this year, although qualities do vary considerably based on samples we have evaluated in the last couple of weeks.

7th Amendment - Act now!
Being a member state of the European Economic Community (EEC) means that we have to adopt many directives and laws passed down by the European Parliament. British governments, both past and present have signed away their right to legislate many issues, either to conform with other European member States, as part of a compromise deal, or, in the case of the current administration, complete ignorance, incompetence, or lack of interest.

The European Parliament processes up to 100 new directives each day. Many do not affect our industry but a good number do and there is a high stupidity factor in some. In previous market reports I have highlighted one or two of the most bizarre. Recently, it tried to pass a directive which made it illegal to drive a tractor for more than 3 hours at a stretch. Try persuading the already beleaguered farming industry to adopt that one! In the end, somebody with a double digit IQ noticed this and the directive did not materialise.

Anyhow, the dreaded 7th Amendment will affect our industry, from growers right through to the high-street consumer. We ask for your support and to contact you MEP or country trade representative before end of business June 10th.

Details from a letter from IFEAT follow...

At the Environment Committee meeting on 22nd/23rd May 2002, several amendments to the Cosmetics Directive of interest to Members were carried by a majority of around 50 MEPs present.

• Amendment 11 - proposal to restrict the use and/or impose conditions on the usage of the 26 fragrance ingredients identified by the SCCNFP as 'allergens' (listed as amendment 12 for next week's meeting)
• Amendment 19 - removal of the current requirement to label a fragrance as 'parfum' or 'aroma' and instead give full information on the composition of fragrances (listed as amendment 21 for next week's meeting)
• Amendment 26 - labelling of the 26 fragrance ingredients identified by the SCCNFP as 'allergens' with an administrative cut-off level. (listed as amendment 28 for next week's meeting)

Interestingly, amendment 19 and 26 contradict each other as it is impossible to label both everything and just the 26 alleged 'allergens'

These amendments will now be put before the European Parliament as a whole for a second reading on the 11-12th June.

It is vital that members lobby their MEP or representative again to encourage them to attend the debate and vote and to take heed of the industry's concerns. This may be the last chance industry gets to influence this legislation.

A draft letter is attached for you to adapt. You can obtain the contact details for your MEP on the following website http://wwwdb.europarl.eu.int/ep5/owa/p_meps2.repartition?ilg=EN&iorig=home Members are urged to write to their MEP or representative by June 10 at the latest and to inform the secretary of any action taken.

Dear xxxx, AMENDMENT TO THE COSMETICS DIRECTIVE - 2ND READING OF THE EUROPEAN PARLIAMENT ON JUNE 11TH/12TH The International Federation of Essential Oils and Aroma Trades represents the global essential oil, aroma chemical and flavour and fragrance trades and has over 200 Members in 40 countries. I have been following the progress of the proposed changes to the Cosmetics Directive with interest and would like to bring to your attention the following information: Essential oils are threatened by this legislation 16 of the alleged allergens occur naturally in more than 150 natural essential oils which are mixtures of many components extracted from botanicals or aromatic plants such as lavender or fruits such as lemon. The composition of these essential oils is very unique and complex. Man- made compositions cannot mimic them. For this legislation, essential oils should be considered as single entities and be exempt from the proposed legislation. The proposed thresholds are far too low to allow the significant use of natural essential oils. This could eliminate the use of essential oils by the manufacturers who may be reluctant to contend with the labelling issue. If essential oils are not exempt from this proposed legislation... Hundreds of thousands of jobs in essential oil based agricultural economies are at risk. Fields such as lavender in France and citrus groves in Italy and Spain will be lost. Many essential oil producers that have been family owned for generations will be put out of business and entire villages that provide the labour will be out of work. Developing countries that depend on their essential oil-based agricultural economies for hard currency will be devastated. We ask that essential oils be designated as single entities and exempt from the proposed labelling. In this respect, I urge you to attend the debate and vote on the 11-12 June and vote against Amendments 12, 21 and 28. It is imperative that any labelling of fragrance ingredients is implemented via an adaptation to technical progress to allow greater responsiveness to advances in technical knowledge about fragrance ingredients. Yours sincerely, Xxx