1. Regulatory and Compliance Risk
- Why it matters: Agarwood is a CITES-listed species (Aquilaria spp.), and local cultivation, trade, and export are subject to strict DENR regulations, including CNC/ECC clearances and harvest permits.
- Investor impact: Delays or non-compliance can halt operations or trigger legal penalties, especially for export-focused ventures.
- Mitigation: Partner with registered entities, secure DENR/BMB approvals early, and maintain ongoing compliance monitoring.
2. Biological and Agronomic Risk
- Why it matters: Agarwood formation is not guaranteed—it depends on effective inoculation, tree age, genetics, and site conditions. Similarly, agroforestry crops face threats from pests, diseases, and erratic weather (e.g., typhoons, droughts).
- Investor impact: Yield variability can affect cash flow projections and ROI timelines.
- Mitigation: Use science-based protocols, tissue-cultured planting materials, dual-action inoculants (e.g., BarIno FusaTrinity™), and climate-resilient agroforestry designs.
3. Market and Commercialization Risk
- Why it matters: The agarwood market is opaque and unregulated in many regions. Price fluctuations, counterfeit products, and limited domestic distillation capacity can all affect margins.
- Investor impact: Overestimating prices or underestimating marketing challenges can lead to losses.
- Mitigation: Build direct buyer relationships (especially in the GCC/Asian perfumery markets), invest in value-added processing (like CO₂ extraction), and establish cooperative models to control the supply chain.