Exporting frankincense to Europe

European demand for frankincense is growing. On the European market, frankincense extracts have great potential in health products aimed at healthy joints. Frankincense oil is also used in aromatherapy to relieve stress and anxiety. However, supplies of this wild-collected ingredient are decreasing. Therefore, sustainability is key.

1. Product description

Frankincense is an oleogum-resin, which is also called olibanum. The resin is harvested from several Boswellia species within the Burseraceae family.

The species most commonly used for health products are Boswellia sacra Birdw. (as essential oil) and Boswellia serrata Roxb. ex Colebr (as resin or extract). Other species include Boswellia papyrifera (Del.) Hochst. and Boswellia neglecta S. Moore.  

Boswellia trees commonly grow in the gum belt in Africa and the Middle East (Ethiopia, Somalia, Oman and Sudan), Pakistan and India.

Table 1: Origins of frankincense varieties

Source: African Plant Database

You need to determine the exact source (species) of your frankincense (see Table 1). In Europe only Boswellia serrata is allowed in food supplements.

Sustainable collection is key for Boswellia, as overharvesting can harm future availability of these wild-collected species. Several Boswellia species are already listed as vulnerable on the IUCN Red List. This list from the International Union for the Conservation of Nature evaluates the conservation status of plant and animal species. Boswellia sacra (synomym of B. carterii) is listed as near-threatened, although this assessment needs to be updated.

B. sacra (synonym is B. carterii) is most commonly used in aromatherapy as an essential oil.

For use in herbal medicinal products, frankincense needs to match the composition as specified in the European Pharmacopoeia.

To collect frankincense, collectors scrub the bark of the trees so that the gum-resin seeps out. They come back later to collect the frankincense.

In some areas, collectors only tap resin that exudes naturally. Steam-distillation of the gum-resin yields frankincense essential oil.

Globally, frankincense resin is mostly used in church/temple-based religious ceremonies, with a small share used as incense by consumers directly.

In European health products, frankincense is mainly used for:

• stress and anxiety: as essential oil in aromatherapy products (B. sacra)
• joint health: as extract of B. serrata, based on the content of boswellic acids

The table below gives an overview of the classification of most commonly used frankincense products on the European market.

Table 2: Classification of frankincense products

Source: European Chemicals Agency

2. Which market segments should you target?

Food supplements

In Europe, you can find the most opportunities for frankincense resin on the food supplements market. The resin has been used traditionally for its anti-inflammatory properties. Various studies have been conducted on the efficacy of boswellic acids, found in the resin, for joint health conditions.

Allowed use for food supplements in Europe:

• Belgium, France and Italy allow the use of Boswellia serrata gum resin.
• Germany allows the use of Boswellia serrata gum, with a maximum level recommended for food.
• Restricted and/or limited for use in food in Austria.

Some countries do not have their own positive list, but follow the lists mentioned above. There are some inter-state agreements. For example, Spain automatically recognises botanicals that are authorised in Italy and industry sources indicate that the United Kingdom accepts references to the BELFRIT list made by companies.

Producers of food supplements cannot make medicinal claims. Examples of claims used in Europe for supplements containing Boswellia are:

• “To move smoothly…”
• “Promotes mobility of joints.”

Herbal medicinal products

On the European market, frankincense is also allowed for use in herbal medicinal products. If you want to target this market segment, you need to comply with the legal requirements for the industry (see the section buyer requirements below).

Monographs list standards for the production of ingredients for herbal medicinal products, and what claims can be made for these ingredients. They also include scientific information on uses and effects. There are different monographs for frankincense:

• WHO monograph (as Gummi Boswellii / Boswellia serrata). Medicinal uses include management of arthritis and rheumatism, bronchial asthma, Crohn’s disease, ulcerative colitis, and traditional uses such as abdominal pain, asthma, coughs and fever. Other activities of the product include anti-inflammatory activities.
• ESCOP monograph 2nd Edition Supplement (as Olibanum indicum)
• European Pharmacopoeia Monograph # 2310 Indian frankincense (as Olibanum indicum)

Aromatherapy

In Europe there are opportunities to use frankincense oil in aromatherapy. In aromatherapy, frankincense oil is mainly used to relieve stress and anxiety and in joint health issues (see Table 3).

Table 3: Aromatherapy uses of frankincense

Aromatherapy relies on the chemical composition of essential oils, which differs per botanical and geographical origins. Therefore, product identity, traceability and origin are of vital importance.

3. What makes Europe an interesting market for frankincense?  

International demand for frankincense is growing, according to European buyers.

Frankincense trees do not grow in Europe. Therefore, the region relies on imports for its frankincense supplies.

Specific data on European trade in frankincense is unavailable. There is no Harmonised System code for trade in frankincense, but products are included under trade in natural resins, essential oils or extracts.

Boswellia sacra is one of the most important varieties of frankincense used commercially. Industry sources indicate that the global market for the oil of B. sacra amounts to 30-40 tonnes. Around a third of that is used in aromatherapy.

Changing perception of health

European consumers are more aware of the importance of a healthy lifestyle, and their understanding of what it means to be healthy is changing. Instead of focusing only on the absence of illness, consumers use health products to prevent diseases and feel good. This trend is driving demand for:

• Natural health care products and ingredients: There is an increasingly strong view that natural ingredients are safer than synthetic alternatives.
• Food supplements: Consumers add supplements to their diets to feel healthier and prevent illnesses. Future Market Insights expects the European food supplement market to increase 7.4% annually from 2015 to 2025. In 2025, the market would then be over US$ 60 billion. Particularly strong growth is foreseen in Eastern Europe.

Growing need for health products for joints

Europe’s ageing, overweight and inactive population has a higher risk of health conditions involving joints. This offers opportunities for frankincense extract (Boswellia serrata) based on their content of boswellic acids. Around 22% of Europe’s population is reported to be under long-term treatment for troubles with muscles, bones and joints, such as rheumatoid and arthritis. Countries with a relatively high incidence include Austria (38%), Hungary (36%), Slovakia (36%) and Spain (35%). The lowest incidence was reported in Cyprus (17%), Finland (16%) and France (11%).

As the condition of joints and healthy ageing are key concerns for the ageing population of Europe, there is a growing interest in food supplements to maintain joint health. Consumers are looking for new ingredients and Frankincense would be a good opportunity in terms of efficacy and history of use.

In addition, younger consumers also show a growing demand for bone and joint supplements, to address physical demands of their lifestyles.

Growing popularity of aromatherapy to reduce stress

There is an increased need for health products to relieve symptoms related to stress. Several studies have found that stress and anxiety are increasing in Europe:

• According to Workplace Options, cases of people experiencing stress increased by 27% between 2012 and 2014, while cases of anxiety increased by over 84% in the same period.
• A consumer survey in the United Kingdom showed that 85% of adults experience stress regularly.
• Around 25% of the European population risks health problems due to workrelated stress.

Consumers are also increasingly using aromatherapy products to relieve stress. They see aromatherapy products as safer compared to conventional medicine and they have a growing trust in their effectiveness.

Frankincense oil (Boswellia sacra) has an opportunity in aromatherapy as it is traditionally used to relieve stress and anxiety.

The market for aromatherapy is especially large in France, Germany, Austria and Switzerland. In these countries aromatherapy is commonly practised as medicine. There is also a good market for aromatherapy in the United Kingdom and the Netherlands.

Expected supply shortages

International demand for frankincense is growing. However, as a wild-collected product, supplies are limited. In various countries, supplies are even expected to decline in the future, for example in Ethiopia and Somalia.

Ethiopia is a leading exporter of frankincense. However, overharvesting, low regeneration and high mortality rates in the trees producing frankincense are likely to halve production over the next 15 years. Trees are also being cut down for use as firewood. In addition, young trees are not surviving due to fire, grazing and beetle attacks.

In Somalia, economic pressure from strong international demand for frankincense leads to overharvesting of frankincense. Trees are being tapped year-round. As a result, trees cannot recover and repair themselves, and so become susceptible to pests. There is no enforcement of sustainable harvesting practices.

The frankincense trees in Somalia are also adversely affected by climate change. Industry sources indicate that the yield of the resin is declining as a result. This could also be an issue for frankincense trees in neighbouring regions.

Research has indicated that Boswellia papyrifera is a threatened species in Eritrea. Other Boswellia species are listed as vulnerable on the IUCN Red List.

According to European buyers, the supplies of Boswellia serrata from India are coming under threat as well.

Strong demand for fair-trade and sustainably produced frankincense  

Sustainability is key for frankincense. Demand keeps on growing and supplies decrease (see trend on expected supply shortages). At the same time, fair and ethical production of frankincense is important as well. This is both a result of consumer demands and of a need on the production side to ensure long-term supplies. Collectors live in remote areas in unstable regions, with a harsh environment in which to collect the resin.

Ethical and especially organic production of essential oils is particularly important when consumers use them as aromatherapy. Consumers see organically certified oils as being of higher quality than conventionally produced oils. Moreover, many European consumers of essential oils for health purposes are also interested in ethically produced ingredients.

4. With which requirements should frankincense comply to be allowed on the European market?  

You can only export your frankincense to Europe if you comply with buyer requirements for natural ingredients for health products

Moreover, your frankincense needs to be sustainably sourced. This is especially important for frankincense because the resin is wild-collected. You also need to communicate to your European buyers that your frankincense is sustainably sourced.

You may need to establish Access and Benefit Sharing (ABS) agreements for your ingredient, if you use the genetic resource for Research and Development (R&D), for example if you research the genes or its biochemical composition.  

Which specific requirements you need to comply with depends on whether your frankincense is used in herbal medicinal products or in food supplements.

Requirements specifically for herbal medicinal products

You can only export your frankincense to the European herbal medicinal products market if you comply with the legal requirements for natural ingredients for health products. For herbal medicinal products specifically, these include:

• Relevant European legislation (Directive 2004/24/EC); simplified regime for traditional herbal medicinal products;
• Detailed quality, documentation, labelling, packaging, certification and traceability standards as established in the rules governing medicinal products in the European Union;
• Marketing authorisation of medicinal products to be sold in the European market;
• Good Agricultural and Collection Practices (GACP) for raw plant materials;
• Good Manufacturing Practices (GMP) for extracts used in herbal medicinal products or active substances used as starting materials.

Requirements specifically for food supplements

You can only export your frankincense to the European food supplements market if you comply with the legal requirements for natural ingredients for health products. For food supplements, these include:

• European legislation for food supplements (composition and labelling requirements);
• General Food Law;
• Food Safety (see below).

Food safety requirements cover:

• Maximum residue levels (MRLs)
• Contaminants in food and microbiological contamination of food
• Food hygiene (Hazard Analysis Critical Control Point)
• Extraction solvents
• Food irradiation
• Traceability.

Additional requirements

Many buyers have additional quality requirements. These can go beyond legislation and standards (for example relating to active ingredient content, moisture content, contaminants and residues). These are established in buyer specifications.

To show that you meet the specifications of buyers, you need to develop well-structured company and product information, including detailed technical data sheets. See our tips for doing business for more information.

Requirements for niche markets

Standards and requirements for social and environmental sustainability include:

• Organic production
• Verification and/or certification of sustainable production, including FairWild, FLO Fairtrade, FairForLife, UNCTAD BioTrade Initiative, Union for Ethical BioTrade
• Supplier codes of conduct
• ISO 26000 on social responsibility.

European food industries increasingly demand compliance with quality and food safety management. Examples include:

• ISO 9001:2015 (required for health ingredients)
• International Food Standard
• ISO 22000 (food safety management)
• ISO 31000 (risk management).

Quality requirements for frankincense

Consistent quality is a major concern for European buyers of frankincense. Good-quality frankincense needs to have a specific composition. You also need to do proper sorting and grading and prevent contamination in your post-harvest processing.

Composition

For European buyers to consider your frankincense oil of good quality it needs to have a certain composition and chemical profile. Differences in the oil’s composition are the result of variations in composition of the resin. These are influenced by specific tree variety, environmental conditions and time of harvesting.

The main chemical compounds of frankincense oil (Boswellia carterii) are:

• α-pinene
• risedronic acid
• linalool
• octyl acetate
• bornyl acetate
• incensole
• incensyl acetate.

Post-harvest processes

Frankincense resin is graded according to size, colour and state of cleanliness. This is to ensure stable quality, which is demanded by European buyers.

For essential oil production, good-quality resins should have a gum-like rather than crystalline consistency. This indicates a higher oil content which would increase your yield.

Different grading systems exist, depending on the Boswellia species. For example, frankincense resins from Somalia are offered in seven grades of Boswellia frereana and three grades of B. sacra. Table 4 gives examples of a grading system for Boswellia papyrifera from Ethiopia.

For these resins, buyers value the larger, paler lumps more highly than small, dark-coloured resins, powder and siftings.

Table 4: Grading system for frankincense (Boswellia papyrifera) in Tigray, Ethiopia

Source: CIFOR, 2011

Labelling requirements

You need to comply with the following demands for the labelling of your frankincense: 

• Set up a registration system for individual batches of your frankincense oil, whether they are blends or not. Mark them accordingly to ensure traceability.
• Label your products in English, unless your buyer wants you to use a different language.

Your labels must include:

• Product name/INCI name
• Batch code
• Place of origin
• Name and address of exporter
• Date of manufacture
• Best before date
• Net weight
• Recommended storage conditions

If you supply organic frankincense, your label needs to include the name/code of the inspection body and certification number.

You also need to give your buyer the following documentation:

• Technical data sheet (TDS), check this example for frankincense oil
• CAS number (if available)
• Certificates of analysis, see this example of frankincense oil
• Safety data sheet (SDS), check this example of organic frankincense oil
• GMO certificate (if requested)
• Certificate of origin
• Product information sheet

Frankincense essential oil is classified as hazardous. This means that you need to include hazard symbols if you export the product as oil. See the examples below. These show that it is flammable and harmful (Xn).

Figure 1: Hazard symbols for frankincense essential oils

You also need to include risk phrases in your Safety Data Sheet. These phrases show what the main risks and hazards are and how you should prevent them. For frankincense oil you need to include phrases with at least the following numbers: R10, R22 and R65.  

Packaging requirements

Packaging requirements may differ per buyer. However, there are some general requirements you have to take into account. See the tips below.

5. What competition do you face on the European market for frankincense?  

Market entry barriers

European buyers only want to do business with you if you can provide a steady, sustainable supply of frankincense. Because access to resins in the country of origin can be difficult, this is a major barrier to enter the market.

Access to resins can be difficult because you may need concession rights to collect frankincense. It can be difficult to organise collectors. Moreover, the harsh environment of the remote production sites in unstable regions for wild-collected frankincense discourages many collectors.

For the resin

The probable drop in future supplies of frankincense may create opportunities for new exporters. Once you have secured sufficient supplies of the raw material, barriers to entering the European resin market are relatively low.

You can collect, sort, grade and clean resins manually. And you need little technology and capital. Your collectors only need basic skills to meet requirements of buyers.

Resins can become scarce and expensive if they are over-harvested. Together with low regeneration and high mortality rates in trees, over-harvesting poses a threat to the supply of frankincense resin, in particular from Ethiopia.

If you apply sustainable resource management to the collection process, you can ensure sustainable supplies. You do not always need to certify your frankincense. Resource mapping and formulation of a resource management plan may be sufficient if well documented.

For value-added products

Barriers to market entry are much higher if you want to export frankincense essential oil (a value-added product of Boswellia sacra). This oil is produced by steam distillation. You need more advanced technology, skilled personnel to work with this technology and you need to manage quality.

Aside from being a threat to your own market entry, these barriers can also be an opportunity if you can comply with market requirements for frankincense oil. High entry barriers also keep out other new entrants.

Since frankincense is wild-harvested, supplies of the oil can vary significantly in quality and quantity. European buyers want stable supplies of oil of consistent quality.

6. What are substitute products for frankincense?

Substitute products for frankincense depends on how the resin or oil is used on the European market. These products can be a threat for your frankincense.

Substitute products for frankincense used to promote the health of joints

Most alternatives to herbal food supplements are natural, non-botanical supplements. Major products are supplements that contain glucosamine and chondroitin. For examples, check the website of Holland & Barrett (United Kingdom retailer). Since these markets are reaching maturity, companies are interested in alternative ingredients that have more potential for growth.

Other natural alternatives include:

• Botanical products, such as seaweed and pine bark extracts;
• Non-botanical products, such as extracts of eggshell membranes.

In joint health, efficacy and safety are key. This needs to be backed up with scientific research and clinical trials. European consumers want products with measurable benefits. Frankincense can stand out from other products because various studies have shown that its extracts have the potential to reduce inflammation and relieve the symptoms of arthritis of the knee.

Substitute products for frankincense used for stress and anxiety

As an aromatherapy product, frankincense oil has most potential to target less severe stress and anxiety conditions. Examples are: relieving minor stress, offering sleep aids or increasing relaxation. On the European market for such conditions herbal products, including aromatherapy, have a strong position, particularly for long-term use. Other aromatherapy oils for this use could be sources for product competition, these include:

• lavender
• neroli
• petitgrain
• (rose) geranium
• ylang-ylang. 

Most species used for stress and anxiety have established markets, and they can be used interchangeably in different combinations, often with vitamins and/or minerals. These are highly competitive markets where margins are comparatively low.

What makes frankincense special compared to other products that relieve stress is its long traditional use as incense and in aromatherapy. The Bible describes it as one of the three gifts offered to Jesus. Frankincense also has a luxurious image.

Company competition

Your main competition will come from other frankincense producers. The largest production is from Ethiopia, Somalia, Sudan, Saudi Arabia and India. Industry sources indicate that Boswellia sacra also grows in Oman and Yemen.

India is the only source for Boswellia serrata, which is used in food supplements and herbal medicinal products. Exports of Indian frankincense fluctuate heavily. In 2014/2015, India exported 87 tonnes of the resin, valued at US$ 176,000. Around 65% of the country’s exports that year were destined for Trinidad, Mexico, Malaysia and the United States. India is also a large producer of frankincense extracts.

Oman has set a maximum for exports of frankincense resin to stimulate the production and export of essential oils.

Somalia only exports frankincense resin as the country does not have distilleries to extract oil.

Sudan exported over 3,700 tonnes of frankincense resin between 2000 and 2007.

India is a growing importer of these products, to extract boswellic acids.

If you want to compete with other suppliers of frankincense, you need to find a unique selling point.

You can create a unique selling point with further processing. This creates a distinct market profile, makes you more attractive to buyers and adds value to your product offering. Options include:

• Ensure proper post-harvest processing (sorting and grading) and proper documentation to exploit opportunities to add value to raw materials.
• Move beyond raw material to produce frankincense oils or extracts which match buyer requirements. Because this is more difficult for extracts, European buyers often prefer to import raw materials and do the extraction themselves.
• Show traceability and sustainable future access to raw materials.

To stand out on the European market you can also certify your company according to social and environmental sustainability principles. This can also add value:

• Producers with a company image focused on ethical or environmental sustainability place more value on certification of the ingredients.
• Food supplements: opportunities for certification increase if the product is positioned as a food-type product, rather than as a medicinal-type product.
• Herbal medicinal products: these cannot use certifications on their labels, but sustainable certification will add value if you target manufacturers with a philosophy that calls for such certification, such as organic.

7. Which channels can you use to put frankincense on the European market for health products?  

Market channels  

Figure 2: Market channels for frankincense for health 

Source: ProFound

Importers and distributors are your most important entry point into the European frankincense market (see figure 2). These can trade in up to 500 species, together with other (synthetic) ingredients. They focus on global sourcing, analysis and quality control, rectification, blending, product documentation and sales to processors and end-product manufacturers.

If you are a small exporter and new to the European market, you can also work with an agent to represent you in the market.

Frankincense resin is cleaned and graded in the country of origin.

In the country of origin, resins can be distilled into an essential oil for the aromatherapy market, or into an extract for the food supplement market.

Resin oils imported from outside Europe mostly enter the region through specialised importers concentrated in Hamburg, Germany (e.g. Roeper) and Marseilles, France (e.g. Mane and Biolandes). Essential oils often do not need further processing in Europe and can be used directly in aromatherapy.

The resin can also be processed in Europe. Further processing of the extract or producing extracts with a standardised content of boswellic acids normally takes place in Europe.

8. What are the end-market prices for frankincense?  

Global prices of frankincense resin average around € 2-3/kg. Frankincense oil is priced at €200–250 per kg.

Figure 3: Indicative price breakdown for frankincense oil, mark-ups in %

Source: ProFound, 2014

Although prices of the oil are higher, so are production costs. The profit also depends on the yields you achieve. For frankincense, yields of 3-10% are common.

In the future, frankincense prices are expected to increase due to limited supply. Unsustainable harvesting may severely decrease the global supply of frankincense. Some industry sources even indicate that the number of trees might decline by 90% in the next 50 years.

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