Why is Agarwood so expensive?


Agarwood oil, also known as Oud oil in Arabic, is an exceptionally rare and costly oil originating from various regions in Southeast Asia and Northeastern India. Referred to as Aloeswood oil, Eagleswood Ud, Kiara, and Oud oil in different regions, it is highly esteemed in the perfumery world for its distinct aroma.

Several types of Agarwood (Oud) are found across different parts of the world, including Cambodia, Thailand, Sri Lanka, and India. However, Indian Oud, primarily discovered in the northeastern states of India, is considered the finest in the realm of perfumery.

Historically, this oil has been utilized in medicines and Ayurveda due to its therapeutic properties. In contemporary times, Agarwood oil serves as a coveted base note in the creation of high-end and luxurious perfumes worldwide.


The exorbitant cost of Agarwood oil stems primarily from its rarity. The depletion of wild forests is a chief reason for its scarcity and high price, with less than 2% of wild agar trees globally producing this sought-after oil. Specialists note that the finest Agarwood oil is derived from exceedingly old trees, which are even rarer.

The aromatic properties of Agarwood oil are influenced by various factors such as geographical location, species, and the tree’s components (root, trunk, and branch), as well as the method of processing, harvesting, and the duration since infection.

Regarding its therapeutic properties, Agarwood oil is believed to aid in alleviating numerous health issues like asthma, abdominal pain, spasms in the intestinal and respiratory systems, fevers, nausea, among other ailments. Its extensive use in aromatherapy is due to its mood-enhancing and relaxation-promoting properties.

The pricing of Agarwood oil varies significantly based on geographic location, species, and tree type. Indian Oud, originating from the northeastern states of India, is the most expensive and highly regarded in Arabian Culture and among the world’s most luxurious perfumes. While other Oud oils from regions like Cambodia, Thailand, Malaysia, Sri Lanka, Indonesia, Vietnam, and China are appreciated, they don’t command the same value as Indian Oud Oil.

The cost of pure-grade Agarwood oil can range from $10,000 to $40,000, depending on its origin, type, and distillation process. Specifically, Indian Oud Oil stands out as the most esteemed among all types of Agarwood oils, commanding a price range between $32,000 and $40,000 USD.