The Eastern Cape is poised to become one of the dominant contributors to South Africa’s burgeoning essential oils industry, with 10 government-sponsored trial sites currently in development throughout the province.
Six of these – co-funded by the Eastern Cape Development Corporation (ECDC) and the Amathole Economic Development Agency – form part of the Essential Oil Project of Hogsback, where approximately eight hectares of communal land is being utilised.
Technical partners in this R640 000 pilot initiative include the University of Fort Hare, the Council for Scientific and Industrial Research and the Departments of Science and Technology.
In addition, ECDC is co-funding with the SEDA Essential Oil Business Incubator four further trial projects at Graaff Reinet, Tsistsikamma, Peddie and at Magwa. A project at Keiskammahoek has been operational since 2006.
These trials form part of a cohesive provincial strategy, championed by ECDC Project Development Unit head Ken Bern, to develop a number of essential oil clusters in the Eastern Cape.
This would entail developing a geographical concentration of essential oil extraction sites alongside other related or complementary businesses with active links, which share specialised infrastructure, labour, market and skills.
It is envisaged that four to six essential oil clusters will be operational at various sites throughout the province within three years, Bern says. Each cluster will have a distillation plant serving at least 30 hectares.
Globally, the essential oils industry – valued at around $10-billion (R68bn) - is enjoying huge expansion as consumers increasingly gravitate towards naturals in flavour and fragrances. This presents a huge opportunity for the Eastern Cape, which is perfectly positioned for huge growth in this sector, Bern says.
The Eastern Cape climate offers great opportunities for what is increasingly a high value crop, and for producing a diverse range of products. Opportunities lie in expanding the area under production to existing products, and in extending the range of crops grown.
In addition to stimulating job creation in economically depressed regions of the province, the essential oil cluster initiative would achieve much-needed agricultural and agri-processing diversification in the province.
The Essential Oils Project is being implemented in four phases. Phase two will see the start of limited commercial production of up to 25 hectares, while phase three involves full-scale roll out of commercial production of up to 200 hectares at the end of the first five-year period. Phase four involves consolidating the project and establishing a processing and product beneficiation plant in the area.
A vibrant essential oils industry would bring substantial and sustained benefit to local communities through job creation – essential oils is a labour-intensive crop – strengthening regional economies and creating new development modes.
Substantial and sustained benefit to local communities would form an integral part of the project throughout the various phases.
“Cluster development is a way to build relationships that facilitate productive activities within a community, bringing together representatives of industry, government, education and other organisations to work for the improvement of the economy,” Bern says.
Possible cluster locations include Langkloof/Tsitsikamma, Graaff-Reinet to Middelburg, Greater Bathurst, R63 Route (Keiskammahoek to Fort Beaufort), Port St Johns to Mthatha and Tsolo and greater Butterworth.
Currently, the South African essential oils industry comprises about 100 small commercial producers of which fewer than 20% are regular producers. Most oil production is in the Limpopo and Mpumalanga regions, Kwazulu-Natal and the Western Cape.
According to the South African Essential Oil Producers Association (SAEOPA) there are approximately 33 commercial stills in operation in South Africa, most of which are in the range from 250kg to 500kg units.