Jamaica Business Development Corporation, JBDC, will in April start taking applications for its essential oil incubator, through which it plans to churn out entrepreneurs to take market share away from importers.
JBDC is eyeing at least a quarter of the US$40 million in annual essential oil imports flowing into Jamaica, Deputy CEO Harold Davis says.
The agency expects to hit the US$10-million target by year four of the programme, and level up thereafter, as start-ups and graduates of the incubator programme move to set up their own operations.
JBDC itself will sell essential oils through its retail arm Things Jamaican to stimulate the industry.
The Government of Jamaica has already put $50 million towards the buildout of the essential oils unit at the JBDC’s Incubator Resource Centre in Kingston. JBDC has procured cold presser and steam distillation equipment to get the programme under way, and a lab has been cleared to test and perfect products at the 2,800-square-foot incubator.
“We have significant interest, particularly from individuals producing the oils at home; but the precise number of clients will be determined by a number of factors, including the products that they are doing,” said Davis.
“In other words, we have to take into account the mix of products that will be processed within the facility, to ensure quality is not compromised,” he said.
Essential oils are heavily used in the food processing, pharmaceutical and cosmetics industries; and can be found in shampoos, massage oils, skincare products, cleaning products, candles and perfumes. The oils are in demand by local manufacturers because of their anti-inflammatory, antibacterial and antiviral properties. Others such as lavender, lemon grass and citrus oils are sought after because they stimulate the senses.
However, the number of manufacturers of essential oils in Jamaica is small.
As part of its mandate to stimulate and develop new industries and business growth areas, the JBDC wants to change that and is bullish on making Jamaica an exporter of essential oils.
The country’s export of essential oils, which includes cannabis oils, was estimated at US$6.4 million in 2020.
“We believe that with the wealth of raw materials that we have in Jamaica with unique properties, like ginger, turmeric; products that are of such high international repute, that certainly creating an essential oil incubator will provide a platform not only to improve import substitution but tap into the export market,” Davis said.
The global essential oils market is expected to grow at a rate of 9.5 per cent annually, from US$9.62 billion in 2021 to US$18.25 billion in 2028.
JBDC’s incubator provides clients with shared production space, technical assistance, training and business services. The agency is still to determine the fee clients will pay for use of the space, but it is expected to be concessionary.
“The amount of time each client will spend in the incubator is based on scheduling of the space itself and the specific needs of the clients,” Davis said.
Davis expects the facility to be in use by this summer.
Source: The Gleaner