Management and Economic Aspects of Growing Aquilaria agallocha Roxb. in Bangladesh

The agar tree (Aquilaria agallocha Roxb.) is an evergreen tropical tree species containing precious dark resinous heartwood (agarwood). The population of agar tree is rapidly declining in natural forests in Bangladesh, and the species is now being planted in government-owned degraded forest sites as well as privately-owned homestead forests. A survey was conducted of 120 agar farmers and 20 agar-based enterprises in the Moulvibazar district of Bangladesh, to investigate the management system of agar plantations and agar-based oil enterprises and the financial viability of both sectors. It was found that the traditional management practices were adapted based mostly on indigenous knowledge and technology to manage agar plantations and agar-based oil enterprises. Discounted cash flow analysis indicated that both agar plantations and agar-based oil enterprises are financially viable. The net present value of 1 ha of agar plantation (rotation period 12 years) was estimated to be Tk. 4.9 million and the net annual return from agar-based enterprises was estimated to be Tk. 0.8 million (Tk. 78 = 1 US dollar). Despite some threats to agar farming posed by the traditional wounding techniques of agar trees and the involvement of intermediaries in the marketing channel of agar trees and agar-based products, this economic sector has potential to play a vital role in rural peoples' livelihood subsistence and forestry sector development in Bangladesh.