WA Sandalwood Industry in Limbo as Government Rule Changes Loom

Sandalwood producers in Western Australia are expressing concerns over the government's lack of communication regarding looming changes to the rules governing their industry. The native wood, highly prized for its use in perfumes, cosmetics, and incense worldwide, can fetch as much as $25,000 a tonne on the open market.

Sandalwood is one of the state's oldest export industries, dating back to 1844, and is now a major cash crop in the Eastern Goldfields and Wheatbelt. Under the current Sandalwood order, in place since 2015, 2,500 tonnes of wild sandalwood can be harvested annually. However, with that order due to expire at the end of this year, producers say the government has not been clear enough on what will replace it.

Harvesters are facing an uncertain future, with concerns centered around a proposed shift in oversight from the Forest Products Commission to the Department of Biodiversity, Conservation and Attractions (DBCA). Michael Matthiessen, a harvester, says many are confused about how the transition to the DBCA is going to work.

"I definitely think there's a risk to the industry if the transition isn't managed properly," he said.

"No one has been asking the questions to myself or other contractors that would give our perspective on the industry. And what is and isn't important going forward."

Matthiessen also emphasized the importance of planning years in advance in the industry, as sandalwood trees take upwards of two decades to mature.

"It takes a lot of time, effort, resources and experience to be a really efficient and effective harvesting contractor," he said.

"Once it's gone, it's going to be quite difficult to recover."

Exporters are also sharing concerns, with Wescorp Sandalwood executive chair Fleur Coakley stating that the industry is being left in the dark.

"FPC contracts are coming up to finish at the end of December, and none of us knows what's happening beyond that," she said.

"If it's not managed well and there isn't that cycle of investment going in … that's what my customers internationally are already concerned about."

Coakley recently joined industry stakeholders to call for greater transparency from the government, citing concerns about the impacts on the international market.

"Everyone's not sure whether we invest or whether we start doing plan B," she said.

"There's really no clarity at all and no formal announcement for any of us."

A state spokesperson stated that a draft review was available and being reviewed by an independent panel, and that the government is committed to facilitating discussion between interested parties.

Not everyone in the industry shares these concerns, with Kalgoorlie-Boulder-based oil producer Dutjahn arguing that the industry has had time to prepare for the changes.

"Everybody's been aware that the current order … expires at the end of 2026," said Director Keith Drage.

"Obviously we have very much a vested interest in what happens between now and then and thereafter."

Drage also noted that a transition away from government harvest on crown land to a mixture of independent Aboriginal operators and plantation resources is an inevitable outcome.