How Oud Became More Expensive Than Gold

03 December 2019
Culture, Argawood, Oud, Perfume, Gold
Agarwood, or oud, has gone from a cultural tradition in Arabia to one of the most sought after and expensive commodities in the world

“Agarwood is not just a fragrance for us,” says Abdullah Ajmal, grandson of the founder and current general manager of Ajmal perfume at The Dubai Mall. It’s culture. Its scent stores memories, memories of our childhood. The Eid mornings we’d wake up with the house impregnated with the scent of oud, and the mosque that would be perfumed with it, too. Back home we’d apply its oil on to our skins to perfume ourselves.”

Agarwood, or oud as it is known here, is derived from a resinous bark of the Aquilaria tree that grows in Southeast Asia. For thousands of years it has been used in different forms to scent Bedouin tents, palaces and applied to the body as perfume. In many ways it has become the scent of Arabia, symbolising Arabian hospitality. Right now, kilo for kilo, it’s more expensive then gold.

“No two ouds are the same,” continues Ajmal. “My father would wear Indian oud, a stronger more intense scent, while my mother preferred Cambodian, the sweeter softer scent. In our home we burn both of them.’ Ajmal said.  It is true that no two ouds are the same. In general a kilo of Agarwood goes for around $8000 while the better quality demands about $30,000 per kilogram. Beyond the best forms of oud there is a special wood, much rarer that is called Kynam. In some parts of the world, especially China and Japan, a kilogram of Kynam can fetch $10,000. Just a couple of years ago, 2kg of Kynam sold for a jaw dropping $20m.

Even at these exorbitant prices, agarwood supplies are dwindling. Due to the high demand among the Asian collector market and with perfume houses all over the world producing oud inspired scents, the evergreen Aquilaria tree is becoming increasingly endangered. According to The Botanic Garden Conservation International only one in 10 produces the coveted resin. The trees don’t show any kind of external signs of containing agarwood and so they’re felled in big numbers, meaning a big drop in recent years.

While it was previously left aside due to its complexity, Western perfumers have climbed on the smoky trail of oud in recent years, with everyone from Christian Dior to Tom Ford and Giorgio Armani all adding an oud note to their collections.

But as its resin becoming increasingly rare, the price and demand of our cultural scent continues to skyrocket.