Sandalwood Market Size, Share, Growth, and Industry Analysis, By Type (Indian Sandalwood, Australian Sandalwood, and Others), By Application (Personal Care, Aromatherapy, Pharmaceuticals, Sculpture, Furniture, and Others), Regional Forecast To 2033

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SANDALWOOD MARKET OVERVIEW

The global sandalwood market was valued at USD 0.34 billion in 2024 and is expected to grow to USD 0.37 billion in 2025, reaching USD 0.78 billion by 2033, with a projected CAGR of 9.4% from 2025 to 2033.

Sandalwood is a type of fragrant wood that comes from the sandalwood tree, which is native to India, Indonesia, and other parts of Southeast Asia. It is highly valued for its distinctive fragrance and is used in various religious, cultural, and medicinal practices. Also, it has a sweet, woody, and warm aroma that is calming and soothing. It is often used in perfumes, incense, and aromatherapy products due to its pleasant scent and therapeutic properties. Further, in traditional medicine, sandalwood has been used to treat various conditions such as inflammation, skin problems, and digestive issues. It is also believed to have antibacterial and antifungal properties.

The market is predicted to rise at a significant CAGR due to the rise in traditional medicine, to cure inflammation, skin problems, and digestive issues and the growing use of sandalwood in aromatherapy. In addition, the market is segmented by type, by application, and by region. Australian sandalwood is the largest type of product in demand. Furthermore, an increasing inclination toward organic products is anticipated to fuel market growth in the future.

SANDALWOOD MARKET KEY FINDINGS

COVID-19 IMPACT

Pandemic Confines the Trade of Sandalwood & harvesting 

The COVID-19 pandemic has had a significant effect on the sandalwood market, particularly in India where the majority of sandalwood is produced. Due to the lockdowns and restrictions on movement and trade, harvesting, processing, and exportation were disrupted, leading to a decline in the supply of sandalwood. This has resulted in an increase in the price of sandalwood products. Although, the sandalwood market has a short-term decrease in supply and demand, but there is a potential long-term opportunity for sustainably harvested sandalwood products in the future.

LATEST TRENDS

Growing Consumer Preferences on Organic & Sustainable Products Expand the Market

The sandalwood market has seen several trends in recent years, driven by changing consumer preferences and increasing focus on sustainability and natural products. Some of the latest trends in the market such as rise in demand for organic and sustainable products, a shift towards natural fragrances, the rising popularity of sandalwood-based skincare, and an increase in sandalwood plantations. These trends are expected to enhance the demand for it in the market which leads to augment the market growth in forthcoming years.

• Expansion of Indian Plantations – As of 2024, India’s National Compensatory Afforestation Fund Management and Planning Authority (CAMPA), under the Ministry of Environment, Forest and Climate Change, reports that 20,725 hectares of sandalwood plantations have been established since commercial cultivation began in 2014

• Growth of Australian Plantations – The Department of Biodiversity, Conservation and Attractions (DBCA), Government of Western Australia, indicates that industry initiatives have led to the establishment of approximately 20,000 hectares of sandalwood plantation across the State’s Wheatbelt region

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SANDALWOOD MARKET SEGMENTATION

By Type Analysis

According to type, the market can be bifurcated into Indian Sandalwood, Australian Sandalwood, and Others.

By Application Analysis

Based on application, the market can be divided into Personal Care, Aromatherapy, Pharmaceuticals, Sculpture, Furniture, and Others.

DRIVING FACTORS

Rising demand for sandalwood in pharmaceuticals and Aromatherapy to Enhance Growth of the Market

The sandalwood market is driven by numerous factors which lead to an increase in the growth of the market such as the increasing demand for sandalwood. As it is known for its unique fragrance and is used extensively in the production of perfumes, incense, and other fragrances. Along with this, it has been used for centuries in traditional medicine due to its antiseptic, anti-inflammatory, and calming properties. The demand for sandalwood is also driven by its use in the production of pharmaceuticals and other healthcare products. Therefore, the demand for it is contributing to the sandalwood market growth and will cater during the forecast period.

• Annual Increase in Cultivation Area – The Sandalwood Society of India notes that India’s total plantation area is growing by 600 hectares per year, driven by expanded planting programs in Karnataka, Tamil Nadu and Kerala

• Government Distribution of Saplings – Under the Government of Karnataka’s “GrowMore, Grow Rich” scheme, Karnataka Soaps & Detergents Limited (KSDL) has distributed 2,800 sandalwood saplings to farmers in Bengaluru and Mysuru divisions since December 2024, and tied up with 670 farmers across 3,586 acres to cultivate sandalwood as a commercial crop

Growing Demand for the Product in Religious and Spiritual Practices Drives the Market Growth

Another driving factor is the usage of sandalwood in religious practices. It is considered one of the sacred woods in many religions and is used in various spiritual activities. The demand for sandalwood is driven by the use of this wood in religious ceremonies and as offerings.

Additionally, as it is a slow-growing tree that can take up to 30 years to reach maturity, and it can only be harvested once it has reached a certain age. The limited supply of sandalwood has made it a valuable commodity, and the demand for this wood is often driven by its scarcity.

RESTRAINING FACTORS

Limited Distribution and Environmental Regulations Could Impede the Growth of the Market

The sandalwood market has some barriers that can obstruct its growth of the market which include, limited distribution as it is primarily grown in a few countries, such as India and Indonesia, which limits its availability on the global market. As well as, some countries have strict environmental regulations that restrict the harvesting and export of sandalwood, which can be a bottleneck for its availability and increase its price. Illegal harvesting decreases the supply and raised the price of wood.

• Long Maturation Period – The Western Australia Forest Products Commission (FPC) manages 6,000 hectares of sandalwood plantations that will require at least 25 years to mature sufficiently to yield commercial heartwood oil

• Decline in Indian Production – The Karnataka Forest Department reports that annual production of Indian sandalwood oil plummeted from 4,000 tonnes in the early 1970s to fewer than 300 tonnes by 2011, due to over‑exploitation and restrictive harvesting policies.

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SANDALWOOD MARKET REGIONAL INSIGHTS

Asia Pacific Dominates the Market due to the Highest Production in the Region

With regard to regional insights, Asia Pacific leads the sandalwood market with the highest revenue growth rate during the projection period. Australia is the largest country in the market followed by India and Indonesia. More than seventy percent of the market revenue is generated by these countries. As it is majorly produced by these nations and their production rate is higher than any other region. Therefore, the sandalwood market shares are prominently held by these countries which are contributing to enhancing the growth rate of the market in the coming years as well.

KEY INDUSTRY PLAYERS

Key Players Emphasis on Sustainable Policies to Acquire Maximum Revenue

In respect of key players in the sandalwood market, the top companies provide the best quality of sandalwood to various industries such as pharmaceuticals, furniture, sculpture, and others to expand profit revenue. The major companies’ emphasis is on mergers, acquisitions, and collaboration with small and medium enterprises to increase their production and supply chain. Along with this, they focus on strategies for sustainable policies to gain long-term profit. Additionally, eminent companies such as Quintis, FPC, WA Sandalwood Plantations, Australian Sandalwood, Santanol Group, KS&DL, Sandalwood Forest, and others. The top three companies occupied the largest shares of the market.

• Quintis – In 2017, Quintis (formerly Tropical Forestry Services) controlled around 80 % of the world’s Indian sandalwood supply

• Forest Products Commission (FPC) – The WA Government’s FPC manages 6,000 hectares of sandalwood plantations on sharefarms across the South West, Wheatbelt and Mid‑West regions

List of Top Sandalwood Companies

• Quintis
• FPC
• WA Sandalwood Plantations
• Australian Sandalwood
• Santanol Group
• KS&DL
• Sandalwood Forest

REPORT COVERAGE

This report describes the sandalwood market. It emphasizes the market value, expected CAGR, and USD value over the forecast period, before and after the impact of the COVID-19 pandemic restrictions on the international market, and how the industry is going to turn the corner is also stated in the report. The report provides significant market data with its product type and product applications, end-use details, and an idea of the market growth in the future. This report also provides an understanding of the growing market trends and developments and their effects on the market growth, driving factors along with restraining factors that impact the market dynamics. Along with this, the leading region, key players of the market, and their tactics to beat the market competition, sustainable policies, their collaboration, mergers, companies’ profile, previous years’ revenue, profit & loss, and market position based on their share value in the market, are also explained in the report.