Agarwood plantation project report cost profit

1 Agarwood tree price in India is around Rs 2 lakh. It is one of the most expensive trees in the world, and if cultivated successfully it generates more income than sandalwood trees as well.  Agar wood plantation project report is given here and this blog post will help you to understand its farming, cost and income.

This tree is also known as Agru tree and people in Assam are already doing its cultivation. Due to the agru tree price hike, it is becoming popular and farmers are taking the initiative for agarwood farming in Karnataka, Maharashtra and some other states. However, the tree is not permitted in every state so you need to enquire from your district forest department about its permission. 

Agarwood plantation project report

A mature Agru tree price in India is more than Rs 8 lakh. This is one of the most costly trees in India and here is the agarwood cost and profit report in easy language for you. So that you can think about farming someday. 

Cost per acre

  • Agarwood plant price in India varies between Rs 30, Rs 45, and Rs 100.
  • Let’s take Rs 50 per plant.
  • 300 to 500 agarwood plants per acre can be planted.
  • Let’s take 350 trees per acre. 
  • Planting material cost = Rs 50 x 350 plants = Rs 17500.

Other cost 

  • Land preparation cost = Rs 15,000.
  • Fertilizer cost = Rs 8000.
  • Irrigation cost = Rs 15,000.
  • Drip irrigation cost = Rs 60,000.
  • Plant protection charges = Rs 6000.
  • Labour cost = Rs 20,000.
  • Miscellaneous cost = Rs 5000.
  • Total cost 1st year = Rs 1,29,000.

Agar tree ideal harvesting time is 12 to 15 years. However, it can be harvested after 8-10 years also with slightly low margins.

Total cost for 10 years 

To calculate 10 year cost first we need to reduce the one-time cost from the first year’s cost .i.e drip irrigation Rs 60,000 + plant cost Rs 17,500 = Rs 77,500.

  • Reduced cost = Rs 1,29,000 – Rs 77,500 = Rs 51500.
  • Cost for 10 years = 10 years x Rs 51500 = Rs 5,15,000.
  • Total cost = Now add the reduced one-time cost with 10-year cost.
  • Total 10 year cost = Rs 5,15,000 + Rs 51,500 = Rs 5,66,500.
  • Total cost = Rs 5,66,500. 

Now let’s calculate the profit quickly.

Agarwood farming profit per acre

  • Agarwood yield per tree – 1 healthy agru tree produces an average 4 kg resin.
  • Resin price per kg = Rs 2 lakh to Rs 5 lakh (depending on quality).
  • Let’s take the minimum price Rs 2 lakh.
  • Profit = Rs 2 lakh x 350 trees.
  • Profit = Rs 7,000000.
  • Net profit = Rs 5,66,500 – Rs 7,000000 = Rs 69433500.
  • Net Profit = Rs 69433500.

Yes, it is possible to achieve the profit in 6 figures in agarwood cultivation. However, it is difficult to get good quality resin in sufficient amounts and resin formation is the biggest challenge in agar farming. 


Which is more expensive agarwood or sandalwood?

Most people are not aware of agarwood trees and think sandalwood is the most expensive tree but they are wrong. Agarwood is more expensive than sandalwood.

How many years to grow agarwood?

It can be harvested after 8 to 10 years but the ideal harvesting time is 12 to 15 years for better quality resin production.

What is the Agarwood price per kg in Assam?

Agarwood chips price per kg is Rs 80,000 in Nagaon, Assam. Whereas resin price is Rs 2 lakh per kg.

How long does agarwood take to grow?

8 years to 12 years.

How many years to harvest agarwood?

Farmers are harvesting agarwood tree in India after 8 years only.

What is agar plantation distance?

Agar plant distance should be 12 ft x 12 ft for 303 trees, 12 ft x 15 ft for 242 trees in 1 acre or 15 x 15 for 194 trees. For 545 trees the spacing will be 8 ft x 10 ft. One should plant 350 agru trees in 1 acre so that they can produce better quality yield.

What is agarwood plant price in India?

Rs 35, Rs 40, Rs 50 to Rs 100 depending on the availability and variety.

Read more

Agarwood vs sandalwood tree

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