The document provides an overview of the essential oils industry in El Salvador. It discusses the country's production of Peru Balsam historically and more recently. It describes the commercial distillation of essential oils beginning in the 1960s-1970s and the founding of Nobs Hidrodifusion in 1986, which remains the main producer of essential oils in El Salvador. A range of oils produced includes vetiver, cascarilla, lemongrass, and others. Raw materials include vetiver roots and cascarilla bark.

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El Salvador is located on
the Pacific coast side of
Central America and shares
borders with Guatemala
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and Honduras

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The population of
El Salvador
is around 7 million
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And the economy is
heavily dependent
upon the agricultural
sector
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Its main products have
been rice,
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Corn,
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Beans,
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Coffee
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And sugar cane
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The last two
traditionally have
been the main
exports and the base
of the national
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In more recent years,
the economy has
benefited from the
development of the
export oriented textile
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And, also, by families
receiving cash from
Salvadorian
immigrants in the
United States
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El Salvador is best
known to the
fragrance and flavour
industry as the major
origin of the so-called
!Peru Balsam"
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The commercial
distillation of
essential oils on a
significant scale is
comparatively recent.
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The aim of this
presentation is to
provide :
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An overview of the
Essential Oil
industry today in
El Salvador, 16 of 91

17. To reflect on theTo Menu
experience of
creating a new
essential oils
production venture,
and to consider
possible future
End. developments. 17 of 91

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PERU BALSAM
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Historically, the name !Peru Balsam"
has caused some confusion in the
essential oil trade. It is actually a
product exclusive to Central America
and, particularly, to El Salvador.
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The term originated from the early
Spanish colonial period in the New
World when this Salvadorian balsam
was shipped to Spain in the flotta
carrying the products from Peru. (In the
early years of the Spanish colonisation
of El Salvador, the country was under
the jurisdiction of the Viceroy in Peru
and all exports bore his seal.)
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There is a taxonomic relationship
between the trees yielding Peru
Balsam and the South American
product known as Tolu Balsam.
However, these two balsams are
regarded as distinctively different in
trade and usage as fragrance and
flavor ingredients.
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Peru Balsam is an oleoresin
exudate of a tall forest tree,
“Myroxilum balsamum”, that is
indigenous to El Salvador and
neighbouring countries
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The quality of Peru balsam varies
according to collection area and with
the dry and wet seasons.
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In the natural state, it is a viscous
semi-solid oleoresin. Exports from
El Salvador are solely in the form
of the natural balsam. In some
importer countries, the volatiles are
isolated by vacuum distillation to
give !Peru balsam oil".
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Exports of Peru Balsam
1930s/40s
Years Tons
Annual av. Prior. To 1940 45-65
Annual av. 1940-1945 100
1947 100
1948 106
Source: Guenther, The Essential Oils, vol. V
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Recent export of Peru Balsam
Year Tons/Year Tons/Average
1976 123
1977 149
1978 146
1979 145 141
1980 135
1981 116
1982 121
1984 134
1985 128
1986 130
1987 203
1988 123
1989 124 135
1995 78
1996 80
1997 126
1998 132
1999 79 99
2000 65 65
Source: J. Raúl Rivera, S.A. de C.V.
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Peru Balsam Exporter

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There are several factors involved in the
reduction in the Peru balsam trade :
!The availability of the wild trees has reduced
along with the expanding human population
and the progressive transformation of forest
land to farming of corn and beans.
! Concerns over skin allergenicity have
reduced usage in some fragrance products.
!Periods of low market prices have made
collection less attractive. 28 of 91

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Chiltiupan
In El Salvador, the main areas of collection of
Peru Balsam today are located on the chain of
mountains locally known as the “Cordillera del
Balsamo”, and especially around the towns of
Teotepeque, Chiltiupan, Tamanique, Jayaque,
Tepecoyo and San Julian. The best balsam is
collected around the town of Chiltiupan..91
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The trees occur on both the land
owned of smallholders and on
commercial coffee plantations.
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Collection and
primary processing
is carried out by
specially trained
people, called
!balsameros" who
continue to use
methods
developed over
hundreds of years :
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A piece of bark,
measuring about 36
by 6 inches, is
removed starting
from the lower part
of the tree trunk.
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The exposed area is then burnt with
a torch
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Then a piece of dry cloth
is placed on the
scorched area to absorb
the oleoresin produced
by the tree in response
to the treatment. This
process is repeated on
the same incision for
three times. Collecting
the cloth every fifteen
days.
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The oleoresin is
extracted from the
cloth by boiling in
water for many hours
and then passage
through a rustic
wooden press. The
bark removed from
the tree trunk is
subjected to a similar
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process.

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The crude oleoresin obtained from
both the cloth (pañal) and the bark
(cascara) processes are sold
separately by the Balsameros.
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The marketing chain for crude Peru
balsam probably has not changed for
over a hundred years. The owner of
the trees receives one half of the
production from the !balsamero".
Sales of the crude product are made
to a local buyer, known as a !coyote".
The latter resells to a larger buyer, a
!mayorista". The final stage is sale to
an exporter.
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38. The exporters sometimes purchase To Menu
directly from the local tree owners
and the !balsameros" in order to get
a better margin. Before export, the
crude oleoresin is reprocessed
again to remove any foreign
matter. The cleaned, water-free
balsam is crystal clear in
appearance. The exporters
generally mix the balsam from the
cloth (pañal) and from the bark
(cascara) to produce different 38 of 91
qualities.

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Producction of Essential
Oils In El Salvador
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The first serious attempts at essential oil
production in El Salvador occurred
during the Second World War with
citronella and lemongrass. However, this
venture lagged behind the developments
in Guatemala, which captured the
market, and the El Salvador distillers
closed down operations.
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Re-stimulation of interest in essential
oils was attempted the 1960s/70s by a
local scientist named Santiago Carrillo
Zimmerman. During those years, he
wrote many articles on the subject and
tried to convince the local authorities
and private investors of the
developmental potential for El
Salvador. However, his words fell on
deaf ears since attitudes to agriculture
and industry systems were very
traditional at that time. Undeterred, Mr.
Carrillo continued his efforts during the
1980s and was responsible for
advisory visits by experts from UNIDO
and other international organisations.
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It is at this stage that my presentation
moves over to a personal Odyssey.
I met Mr. Carrillo and this developed into
a friendship that lasted until his death in
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1995.

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In 1985, we made a trip to Haiti to see
the essential oil industry. On return
home, I commenced cultivation trials with
vetiver, patchouli, lemongrass, citronella
and palmarosa. 44 of 91

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In the following year, 1986, Mr. Juan
Nobs, a Swiss entrepreneur - whose son
had worked at Schmidt in Switzerland -
imported a 1,500 litre Schmidt
Hidrodifusion still and founded Nobs
Hidrodifusion. He started distilling of a
range of oils on a small scale with the
help of a Belgian, Etienne Legasse, who
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had designed the still

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In 1988, experience from my
agricultural trials with
essential oil plants prompted
me to move to commercial
production. Since Mr Nobs
had already developed the
extraction technology and I
had the plantations, we
became partners. Since then
we have developed and
exported many different
essential oils to the
international market.
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The early 1990s also saw a separate
essential oil venture which was
initiated by the German Aid Agency,
GTZ, with Mr. Albrecht von
Keyserlingk and Mr. Klaus Durbeck
as the advisors
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The aim of the programme was the
creation of a smallholder-based industry
in poor rural areas. Implementation was
via local NGOs (Non-Government
Organisations), to which small, simple
steam stills were donated by GTZ. This
program lasted for about three years but,
since there was very little follow up on
the NGOs, there is hardly any oil
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The only current commercial essential oil
producer in El Salvador is The Nobs
Hidrodifusion Company. 49 of 91

50. For those of you unfamiliar with the To Menu
hydrodifusion process, the following slide
provides a description:
Vapor Line
Boiler
"#$ %#&'"(#)
*+,-',.+"
/)+"',&(,'
/)#.0.
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51. This process differs from conventional steam
distillation in that steam is introduced at the To Menu
top of the distillation pot and the oil vapour /
steam mixture exits at the base.
Boiler
CoolingToner
Cool Hot Water
Water
Water Oil
DESTILLATE
To Treatment Plant
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This technique:
! Confers advantages with some oils by
providing a product that is closer in aroma
character to the fresh raw material, and
!The oil composition can differ qualitatively
and quantitatively from those obtained by
conventional steam distillation. Both these
facets are of interest to some sectors of the
market
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The current range of oils produced
routinely are:
Vetiver: 600 kg
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Cascarilla (Croton Reflexifolius):
100 kg
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Lemongrass (Cymbopogon Flexuosus):
100 kg
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Citronella: 100 kg
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Palmarosa: 20 kg
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Oregano (Lippia Graveolens): 20 kg
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Ginger: 20 kg
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Tagetes
(Tagetes Microglosa):
20 kg
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Patchouli: 20 kg
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Cinnamon leaf: 20 kg
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Petigrain: 20 kg
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Cedrella Odoratta: 20
kg
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Eucalyptus Citriodora: 20 kg
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Around 70% of the raw material feedstock
is grown by the Nobs Hidrodifusion
Company. The balance of the requirement
is bought on the open local market from
people dedicated to the trade.
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67. Actually the most important To Menu
Raw materials
for Nobs Hidrodifusion are:
Vetiver
Digging Vetiver Roots
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Vetiver Roots
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Chopping Vetiver Roots
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Cascarilla
Removing Cascarilla
Bark From The Tree
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Cascarilla Bark
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Cascarilla Bark Processed
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73. Along the way, we conducted trials To Menu
also on the following products that
have not yet been commercialised:
!Basil
!Cardamom
!Tagetes Pusila
!Tagetes Lucida
!Turmeric.
!Ambrette Seed
!Vanilla 73 of 91

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Laurel
(Laurus Nobilis)
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Black Pepper
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Eucalyptus Globulus
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Clove
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Jazmin
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Ylang Ylang
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In the early years, we could not
comprehend why praise was
received for the more !true-to-nature"
aroma character of our products but
there was no interest in purchasing
the material. Why were our superior
products being rejected? Our basic
difficulty was a lack of understanding
of the structure of the essential oils
market.
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All Spice
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Our processing technique provides oils
that are different in both aroma and
chemical composition to conventional
steam distilled oils. This poses a problem
in incorporating our oils in established
product formulations for which a
consistency of overall character is
expected.
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Eventually, we came to realize that
we were offering new oils and that
usage was dependent upon others
downstream in the industry creating
a market for new product
formulations.
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Future of the Essential Oil
Industry In El Salvador
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Peru Balsam:
Recently, the German Government GTZ
Agency has started a project that will
evaluate the market of the Peru Balsam
derivatives or compounds that are already in
the market.If the evaluation is positive they
are planning to collaborate with Nobs
Hidrodifusion Company on exploring the
possibility of the local distillation /
fractionation of Peru Balsam.
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The basis for the GTZ aid is that the
added value gained will be divided
among the participants of the chain of
production.
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If this project is successful there will be
great hope for the Peru Balsam"s
future, otherwise, it seems like the
market of the Peru Balsam will continue
on the decline.
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Other essential oils:
El Salvador possesses many favourable
conditions (climate, costs, market proximity,
etc.) for the production of a range of essential
oils. Experience has been gained the hard
way over the years on the difficulty of
entrance for new suppliers and we are
confident that there is a future for us to
develop. The key to success lies with careful
product selection, particularly assessment of
what comparative advantage exist as a
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supplier.

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We trust that the buyers and consumers
in the audience will give us guidance.
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