Esential Oils

Esential Oils

Project Profile:

The global market for essential oils in 2014 was USD 5.5 billion. It grows at an average yearly rate of 5%. The Soviet Union was the #1 exporter of coriander essential oil and under Soviet rule Georgia had a rich history of essential oils production:  primarily rose, coriander and eucalyptus. A Georgian pharmaceutical company, which currently produces 160 unique drugs, plans to produce its own essential oils and cosmetics line, including soaps and shampoo out of a plant in the Mtskheta region of Eastern Georgia. The plant will have a production capacity of 700 tons using a new technology that extracts 50% more oil from plants all of which will be cultivated locally. A pilot production has already begun extracting oils from 15 kinds of plants using critical CO2 extraction, cold press and hot distillation. The total investment for this project is USD 265,000 with a 5 year IRR of 15%.

Background:

Global essential oils market:

Market size (2014) – USD 5.5 billion
Annual growth rate – 5%
The USA is considered as the biggest essential oils market in the world– USD 900 million
India is the world’s largest exporter– USD 600 million
Bulgaria:
The major exporter of essential oils in the region
17thbiggest world essential oils exporter– USD 50 million (2014)
Turkey:
23rdbiggest world essential oils exporter– USD 30 million (2014)
Advantages of Georgia:

Duty free export to the EU, US, CIS and other regions with total population of 2 billion
Existing infrastructure and communications
Inexpensive resources such as water, electricity and labor
Advantageous geographical location: easily accessible European and Asian markets via the Black Sea ports of Poti and Batumi
Warm local climate

Project Description:

Plant location – Mtskheta region, Eastern Georgia
Business activity – CO2extracted oils (Lavender, Rosemary, Chamomile, Iris) cold pressed oils (Orange, Lemon, Tangerine), distilled oils (Geranium, Melissa officinalis, Basil, Mint, Eucalyptus, Laurel, Valerian)
Production input – all plants will be cultivated locally
Production capacity – 700 Tons
Personnel – 10
A detailed business plan and any other information will be provided upon request. Feel free to email us at GIDG@economy.geor see the contact information below
Financial Highlights

Total investment – USD 265,000
The expected revenue for a year – USD 160,000
EBITDA – USD 40,000
5 year IRR – 15%

Governmental Resources:

The Government of Georgia provides the following financial incentives:

Nominal price for land
Loan/leasing subsidy through the “Produce in Georgia Initiative” (ge)
Equity co-financing through the Partnership Fund (ge)
Technical assistance through Georgia Industrial Development Group

In Summary: Essential Oils

Essential oils are essential once again for Georgia. CO2 extraction is used on lavender, rosemary, chamomile and iris. The cold press method is used on orange, lemon and tangerine. Distillation is used for geranium, melissa officinalis, basil, mint, eucalyptus, laurel and valerian. The outcome is a diversity of products and an extraordinary investment opportunity.

phone:

551176470 ENG

phone:

577772203 GEO

phone:

595655655 RUS

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