MELAKA: Malaysia will begin drawing up grading standards for agarwood essential oil, or oud, this month as it seeks to build a national brand that can hold its own in the global fragrance market, says Plantation and Commodities Minister Datuk Seri Dr Noraini Ahmad (pic).
She said the six-month project to develop the standards is the first step towards a National Agarwood Grading System, which the Malaysian Timber Industry Board (MTIB) is working on with research institutions and industry experts.
"To compete in the global market, Malaysian agarwood needs its own identity.
"These standards are important to raise buyer confidence and strengthen the 'Malaysian Oud' brand at the international level," she said when launching the Agricommodity Entrepreneurs Festival 2026 here on Monday (Nov 9).
ALSO READ: Time to turn agarwood exports into premium products
Noraini said the main species of karas tree that produces agarwood, or gaharu, in the country is named Aquilaria malaccensis, after Melaka.
She said five of the 22 Aquilaria species in the world are found in Malaysia.
"In the past, agarwood was known only as a fragrant wood from the forest. Today, it can be lifted up as a Malaysian fragrance brand on the world stage," she said.
According to Noraini, karas leaves are now being processed into tea, coffee and biscuits, while agarwood oil extract is used as a base for cosmetics, aromatherapy and branded perfumes.
Noraini said MTIB had been guiding agarwood growers and entrepreneurs since 2006 through advisory services, courses and workshops.
As of September, 456 growers accounting for about 2.3 million karas trees had registered with the board.
"In less than a year, almost 100 new growers have joined the industry. This shows the people's confidence in the future of agarwood," she said.
Under an inoculation incentive, MTIB provides RM100 for each tree, with 161 growers receiving a total of RM1.76mil so far.
ALSO READ: Layering fragrances is now a popular way to personalise your scent, here's how
The board also offers an essential oil distillation incentive to help agarwood entrepreneurs add value to their products.
Noraini said MTIB, as the CITES management authority for the peninsula and the Federal Territories, also ensures that the agarwood trade is carried out legally and sustainably.
"We want the world to recognise Malaysian agarwood not only for its fragrance, but also because it is produced responsibly," she said.
She said the timber industry is the third largest contributor to the agricommodity sector after palm oil and rubber, with exports of timber and timber products worth RM21.5bil last year.
This year, 23 entrepreneurs assisted by MTIB to take part in international exhibitions recorded sales of RM3.2mil, she added.
The two-day agricommodity festival features agarwood, cocoa, pepper and kenaf products, as well as woodcarving demonstrations and do-it-yourself wood product activities.
