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Program 2

2.4 Essential Oils and Plant Extracts

Objective: To support the growth of a profitable and sustainable essential oils and natural plant extracts industry in Australia.

Some Key Performance Indicators

Expenditure in 2001–02: $360,997
Compared with 2000–01: $374,954

Background

Between 1993 and 1998, world demand for essential oils grew at an average rate of 6.1 per cent, botanical extracts at 15.9 per cent, plant derived chemicals at 9.8 per cent, and gums, gels and polymers at 7.4 per cent

Essential oils are largely used in the food flavouring, cosmetics and fragrance industries but their use in aromatherapy and other health care areas is growing. Changing consumer preferences in favour of natural over synthetic substances has had a strong impact on pharmaceutical and cosmetic industries, which has translated into growing demand for essential oils and plant extracts.

There is increasing interest in essential oils in Australia and there are good opportunities for producing plant extracts from both native and exotic species. The current value of production (excluding tea tree oil but including the refining of imported eucalyptus oils) is $6–7 million at the farm gate and $20–25 million wholesale/retail a year.

The Australian essential oils industry is made up of around 150 commercial producers, with production dominated by a few larger firms. Most essential oil production takes place in Tasmania, Victoria and New South Wales (NSW). Tasmania produces commercial quantities of lavender, parsley, peppermint, dill, boronia, blackcurrant bud, and fennel. The

main essential oils produced in NSW are tea tree and eucalyptus, while peppermint is the main crop produced in Victoria. For most of the essential oils that Australia produces, its share in world production is relatively small.

The medicinal herb market has been identified as a huge potential market for Australian production of plant extracts, with both local and export opportunities. At present, only about one-third of the 250 tonnes used each year is supplied from Australia. The main medicinal herbs produced in Australia are echinacea species, licorice root, skullcap, dandelion root, golden seal root and valerian root. Several native plants are used for the production of substances such as scopolamine, esculin, castanospermine and methyl cinnamate within the fine chemicals sector.

Australia has a comparative advantage as a reliable supplier of clean, good quality, unique oils and extracts based on the use of high technology in both production and extraction. However they must meet well-defined quality parameters.

The program now has a new five year plan developed in consultation with Australian producers, marketers and researchers.

Strategies

  • Improve understanding by potential researchers and producers of markets for essential oils and plant extracts.
  • Improve existing products and encourage the development of new crops and new products (including uses for existing products).
  • Support the development of sustainable and profitable production systems.
  • Facilitate regulatory approvals for essential oils and plant extracts.
  • Promote cost effective post harvest and extraction technology to improve yield and quality.
  • Encourage the development of essential oils and plant extract industries by promoting industry networks and the flow of information.
    •  This Sub-Program has its own five-year R&D plan, which is accessible in hardcopy and on the Internet at www.rirdc.gov.au/pub/essentoi.html

    Key outputs in 2001–02

  • Completed a review of the Essential Oils and Plant Extracts program.
  • Published a new five year research and development plan for the program.
  • Published reports on double harvesting of peppermint, re-establishing boronia plantations and production of high quality Australian ginseng.
  • Reviewed the research requirements of the Australian lavender industry.
  • Published further issues of an industry newsletter produced by the Essential Oil Producers’ Association of Australia.
  • Supported the second National Conference on Herbs, Native Foods and Essential Oils, Lismore, 16-18 August 2001 and the 6th International Lavender Conference held at Charles Sturt University, Wagga on 25–26 August 2001.
    •  Publications in 2001–02
    02/052 The Australian Lavender Industry- A Review of Oil Production and Related Products
    02/007 Re-Establishing Commercial Boronia Plantations
    02/001 Growing Milkweed (a plant with prospective anti-cancer properties)
    01/170 Production of High Quality Australian Ginseng
    01/062 R&D Plan for the Essential Oils and Plant Extracts Program
    01/68 Essential Oils and Plant Extracts Research in Progress 2001

    Research Manager: Mr Tony Byrne
    Phone:  02 6272 5472
    Fax: 02 6272 5877
    Email: tony.byrne@rirdc.gov.au


    2.5 Organic Produce

    Objective: To optimise the profitability of Australian organic production in both domestic and overseas markets and to promote the utilisation of organic farming systems as a means of enhancing the sustainability of Australian agricultural systems.

    Some Key Performance Indicators

    Expenditure in 2001–02: $265,634
    Compared with 2000–01: $226,166

    Background

    Consumers are increasingly aware of the quality and safety of the food and fabrics they consume. At the heart of this worldwide trend is a desire to consume products, especially foods, that are safe, produced from environmentally sustainable farming systems, and ethically and socially acceptable. In growing numbers, export and domestic consumers are seeking certified organically grown products in response to this concern.

    The Australian organic (incorporating biodynamic) industry has around 1800 certified/registered members collectively marketing product estimated to be worth, at the retail level, approximately $200 million in 2001. On current trends the industry is estimated to grow by 40% over the period of the current 5 year plan (2500 members, $260 million). Members come from all sectors of the value chain—growers, processors and manufacturers, retailers and consumers—across all States. They operate in diverse rural industries, including grains and pulses, horticulture, viticulture, beef and pork, dairy, sugarcane and honey. Seafood is a new opportunity driven by the increasing contribution of the aquaculture sector. Seven organisations are currently registered with the Australian Quarantine and Inspection Service (AQIS) to inspect and certify organic farming, processing and marketing systems.

    Rising domestic and overseas demand for Australian organic products is prompting a greater number of conventional farmers and processors to consider and adopt organic farming and processing systems. Typically the attraction is either improved market access and/or higher prices from niche markets, together with recognition by the marketplace of better and more sustainable farming practices.

    Strategies

  • Address strategies and targets published in the R&D Plan 2001-2006.
  • Document and develop new organic system designs appropriate to Australia.
  • Increase awareness of new and existing successful plant and animal nutrition methodologies.
  • Identify and develop new understandings of integrated soil management techniques.
  • Identify and overcome structural, technological, economic and social impediments to conversion.
  • Document successful processes for conversion in a variety of industries.
  • Promote policy and standards-setting processes that deliver market access based on verifiable objective equivalence of certified products while recognising the uniqueness of Australian production systems.
  • Foster industry development.
    •  This Sub-Program has its own five-year R&D plan, which is accessible in hardcopy and on the Internet at www.rirdc.gov.au/pub/pub/organic.html

    Key outputs in 2001–02

  • New 5 year plan developed in partnership with the organic industry and launched in August 2001.
  • Successful inaugural national organic conference to assist the Australian industry to rise to the challenges it faces held in September 2001.
  • Facilitation of the bid process for the Australian Organic Food and Farming Systems Cooperative Research Centre.
  • Australian industry representation at world conferences; Europe (IFOAM) and a biodynamic workshop in southern India.
  • Support to the OFA and other industry organisations to represent the Australian industry at the Biofach Trade Show in Germany in February 2002.
  • HACCP and audit-based training program for organic inspectors developed and courses held
    •  Publications in 2001–02
    01/171 Integrating Organic Certification with Food Safety Certification Systems
    01/121 Inaugural OFA National Organics Conference 2001 – Record of Proceedings
    01/69 Organic Produce Research in Progress 2001
    01/104 R&D Plan for the Organic Produce Sub Program 2001-2006

    Research Manager: Ms Denise Millar
    Phone:  03 9859 7249
    Fax: 03 9859 6249
    Email: denise.millar@bigpond.com


    2.6 Rare Natural Animal Fibres

    Objective: To facilitate the development of new and established industries based on rare natural fibres.

    Some Key Performance Indicators

    Expenditure in 2001–02: $214,695
    Compared with 2000–01: $182,277

    Background

    The program can incorporate cashmere, mohair, alpaca fibre, camel hair and other rare fibre projects. The R&D projects currently cover the first three of these fibres.

    In 2001 world prices for mohair were initially maintained, had a downturn by the middle of the year and then showed a slight recovery in December. The general downturn in the economic growth in many of the developed nations and the devaluation of the South African currency contributed to the reduction. Cashmere and alpaca fibres prices were also affected but dehaired cashmere is still well sought internationally. Reducing fibre diameter is still a high priority for all these industries. Raising the efficiency of production and by growing what is required by the processors/markets will increase productivity and net returns.

    Strategies

  • Address, within budgetary limitations, published strategies and targets in the 1998-2003 R&D Plan.
  • Identify and research appropriately with industry fibre properties required for commercialisation by processors to produce yarn, fabric and garments demanded further along the value-added chain.
  • Maintain R&D in blending rare fibres with traditional fibres such as wool, cotton and synthetic fibres.
  • Increase productivity on-farm by investment in health and breeding research.
  • Communicate to stakeholders progress and conclusions of projects.
    •  This Sub-Program has its own five-year R&D plan, which is accessible in hardcopy and on the Internet at www.rirdc.gov.au/pub/rna/index.htm

    Key outputs in 2001–02

  • Published a business plan for the Australian Mohair industry. A SWOT analysis was made of seven industry sectors. One of the recommendations was to set an Australian production objective of about 1 million kg per year to restore critical mass and provide efficiencies and marketing positioning. This level of production is approximately double that in 2001–02.
  • Greater knowledge of the female reproduction in alpaca has been reported from research that manipulated hormonal control via various progestogen treatments association with ovarian follicular wave synchronisation.
  • Commenced research into progeny testing mohair sires and optimising harvesting strategies in angoras.
  • Published three final reports.
    •
    GOAT FIBRE SUB-ACCOUNT
    ACTUAL
    2000–01($)
    2001–02 ($)
    Opening Balance
    30,081
    60,340
    Total Revenues
    86,895
    66,406
    Total Expenditure
    56,636
    65,017
    Surplus/(Deficit)
    30,259
    1,389
    Closing Balance
    60,340
    61,729

    Publications in 2001–02
    02/016 Clip Preparation Standards for Australian Alpaca Fibre - Grower Adoption
    01/070 Rare Natural Fibres Research in Progress 2001
    01/093 A Business Plan for the Australian Mohair Industry
    01/091 Mohair Blend Worsted Manufacture

    Research Manager: Dr Peter McInnes
    Phone:  08 8556  7331 
    Fax: 08 8556  7289
    Email: mcinnes2@comstech.com


    2.7 Tea Tree Oil

    Objective: To support the continued development of a profitable Australian tea tree oil industry in Australia.

    Some Key Performance Indicators

    Expenditure in 2001–02: $262,971
    Compared with 2000–01: $610,717

    Background

    Tea tree (Melaleuca alternifolia) is native to the north coast of New South Wales. Its oil has gained widespread therapeutic use for fungal and microbial infections but is not yet registered for use by the medical profession.

    The industry comprises some 250–280 growers and is located principally in northern New South Wales and on the Atherton Tableland in Queensland. More than 90 per cent of Australian tea tree oil is exported, principally to North America and Europe. The major end uses of the oil are in antimicrobials and cosmetics, with much of the oil being sold as a pure oil.

    As plantings increase, there is currently an imbalance between supply and demand. The budget for 2001–02 was smaller than that in 2000–01. This is partly because a significant injection of funds from particular companies raised the expenditure in 2000–01. In addition, the industry has not yet recovered sufficiently to contribute voluntary levies of the order that it had previously.

    However, the industry remains optimistic about its future. The challenge is to build on recent R&D achievements, particularly relating to safety and efficacy and to explore options for new applications of tea tree oil. On the production side, continued work on breeding superior genetic material also remains a priority.

    Strategies

  • Improve the understanding of markets for tea tree oil.
  • Improve existing products and develop new ones.
  • Enhance the ability of the industry to meet appropriate safety and efficacy standards.
  • Provide production systems that are both ecologically sustainable and profitable.
  • Enhance the human capital of the industry.
    •  This Sub-Program has its own five-year R&D plan, which is accessible in hardcopy and on the Internet at
    www.rirdc.gov.au/pub/tto5yr.htm

    Key outputs in 2001–02

  • Significantly increased oil yield and quality by selecting and breeding tea tree lines of different provenance and sales of improved seed.
  • Continued the publication of an industry newsletter as a means of improving communication with the R& D program.
  • Reports on:
  • Tea tree oil as a topical decolonisation solution for adult in-patients with Methicillin-resistant Staphylococcus aureus.
  • Clinical efficacy of tea tree oil for treating coldsores.
  • The anti-inflammatory and anti-itch properties of tea tree oil.
  • The antifungal activity of tea tree oil in vitro.
  • The tea tree breeding program.
    •
    TEA TREE OIL SUB-ACCOUNT
    ACTUAL
    2000–01($)
    2001–02 ($)
    Opening Balance
    13,190
    27,571
    Total Revenues
    657,456
    372,603
    Total Expenditure
    643,075
    296,669
    Surplus/(Deficit)
    14,381
    75,934
    Closing Balance
    27,571
    103,505

    Publications in 2001–02
    02/053 The Anti-Inflammatory and Anti-Itch Properties of Tea Tree Oil- In Vivo Studies
    02/036 Safety of Tea Tree Oil – Second Stage 
    01/071 Tea Tree Oil Research in Progress 2001
    02/017 Improving Australian Tea Tree - through Selection and Breeding (1996-2001)

    Research Manager: Dr Roslyn Prinsley
    Phone:  02 6272 4033
    Fax: 02  6272 5877 
    Email: roslyn.prinsley@rirdc.gov.au


    2.8 Wildflowers and Native Plants

    Objective: To improve the profitability, productivity and sustainability of the Australian wildflower and native plant industry.

    Some Key Performance Indicators

    Expenditure in 2001–02: $403,674
    Compared with 2000–01: $416,532

    Background

    Wildflowers are now cultivated in all States, but Western Australia still accounts for more than half of Australia’s annual wildflower production valued at around $50 million at the farm gate. The relative importance of bush-picked flowers is declining, even in Western Australia.

    In 2001–02 the value of exports of wildflowers and foliage plants exceeded $30 million. The key commercial wildflowers are Geraldton wax, kangaroo paw, Thryptomene, Stirlingia and species of Banksia, Leucadendron and Protea, with species other than waxflower increasing in relative importance. The major markets are Japan, the United States, the Netherlands, Canada, and Germany.

    Strategies

  • Understand, strengthen and develop markets.
  • Improve existing products and develop new ones.
  • Provide profitable and sustainable production systems.
  • Enhance the human capital of the industry.
    •  This Sub-Program has its own five-year R&D plan, which is accessible in hardcopy and on the Internet at www.rirdc.gov.au/pub/wildflow.html

    Key outputs in 2001–02

  • Started new projects on The Australian Cutflower Best Bets Program and speeding the release of new varieties of Leucadendron.
  • With the aim of widening the range of flowers available to growers, published reports on species of Boronia, Chamelaucium, Corynanthera and Scholtzia and on tropical foliages.
  • Published and distributed several grower-friendly Short Reports on completed projects
  • Provided Gold Sponsorship for the 6th National Wildflower Conference scheduled for June 2002.
  • Provided financial support for R&D Consultation Workshops for the Queensland flower industry.
  • Provided funds for researchers and industry members to attend national and international conferences and workshops.
    •  Research Manager: Mr Max Bourke
    Phone:  02 6247 4630
    Fax: 02 6247 4051
    Email: mbourke@ruralfunds.com.au

    Publications in 2001–02
    SR 110 Blue Smoke Bush for Cutflower Production
    SR 102 Leptospermum as an Export Cut Flower Crop
    SR 104 Flower Export Statistics
    SR 105 Controlling Leaf Blackening in Protea
    SR 106 New Hybrid Leucadendrons
    SR 107 Double Pink Waxflower – Propagation Development
    SR 108 Selection, Propagation and Cultivation of Golden Cascade for Cutflower Production
    SR 109 The Breeding Biology of Waxflowers
    02/021 Postharvest Handling of Australian Flowers- A Practical Workbook
    01/158 Cutflower Production of Blue Smokebush
    01/157 Cutflower Production of Golden Cascade
    01/072 Wildflowers and Native Plants Research in Progress 2001
    01/096 Double Pink Waxflower – Propagation Development
    01/098 Controlling Leaf Blackening in Protea
    01/099 New Hybrid Leucadendrons
    01/097 Export Statistics for the Flower Industry
    01/156 The Breeding Biology of Waxflowers

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    Last updated: October 2002
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