As one of the main producing regions for citronella oil, changes in production in Yunan province, China, are forecast to have a serious impact on the price of this material.

For several consecutive years since 2003, the price of citronella oil has been quite low, which prompted many citronella grass farmers to switch to more lucrative crops, including tea, rubber and sugar cane.  As a consequence output levels fell from 200MT in 2003 to just 500MT in 2006, and prices increased accordingly.  This increase in price lead many farmers to look at switching back to Citronella however there are three key problems that will hamper a reversal from the current situation.

1. Firstly it takes 2-3 years for the Citronella crop to grow to a stage at which it can be commercially harvested for oil production, so it will be as least 2008/9 before any replanted crop oil might appear on the market.

2. The farmers rely upon cutting down trees from the forests in order to obtain wood for the distillation.  However local Government has stepped in to prevent further forest destruction and no longer provides any support to farmers growing this crop.  Unsurprisingly this has lead to a further reduction in the area under cultivation.

3. Most of the citronella grass that is currently available for harvesting was planted in 2001-2002 and has deteriorated over the years so that now only the roots are large and the grass available for cutting is very limited.

Please note whilst every effort is made to ensure its accuracy this information should be treated as a guide only.