Business is not a bed of roses for Bulgaria’s rose oil makers these days.
Made from Damask roses grown in the aptly named Rose Valley, the oil is a vital ingredient in the perfumes made by the world’s top luxury brands such as Christian Dior, Estee Lauder and Chanel.
But a heatwave has slashed this year’s harvest of rose petals, labour is hard to find and the global surge in energy prices has increased costs for a product so precious that it is dubbed “liquid gold”.
This year’s oil will be “considerably more expensive,” Plamen Stankovski, a partner at rose oil producer and exporter Bulattars, told AFP in his distillery near Pavel Banya, in Bulgaria’s famed Rose Valley.
Production costs for one kilogram of rose oil stood at around 6,000 euros ($6,300) in 2021, but they have surged by as much as 40 percent this year.
The price of petals alone doubled since last year, according to producers.
This means that a 4.5-kilo glass jar filled with the thick, golden-yellow oil could sell for more than 45,000 euros this year.
Bulgaria is the world’s top rose oil maker along with Turkey and the distilleries to make the precious substance run on natural gas, diesel and fuel oil — commodities whose prices soared after Russia invaded Ukraine in late February.
“The price of fuel has gone up two or even three times,” Stankovski said.
– ‘Not all roses’ –
Small amounts of rose oil are used in almost every high-quality perfume — not for its aroma, but because its fixative qualities help blend other ingredients and prolong the scent on the skin.
To produce it, huge amounts of petals are boiled in massive metal vats. The vapours are then distilled to separate the oil in a process nearly unchanged since the days of the Ottoman empire in the 17th century.
On his family’s rose fields near Pavel Banya, Dimitar Dimitrov laments that a chronic labour shortage has plagued the sector for years.
“Picking is the most expensive as it is done solely by hand. If you don’t pick the open roses today, tomorrow they’re gone,” said the 40-year-old, who plucked petals with his father and brother-in-law.
Fertiliser, fuel, ploughing and pruning have all become more expensive, he said.
With petal prices almost doubling, he said he hoped “this will cover at least our production costs so we don’t end up in the red”.
To make things worse, a heatwave scorched rose buds before they could open, slashing yields and reducing the picking season by half.
The flowers that survived excrete less oil. To extract one kilo of rose oil, 4,000 kilograms of petals are now needed, 15 percent more than usual.
“We are worried by the increased cost of our production,” said exporter Filip Lissicharov, CEO of the Enio Bonchev Production company in the nearby village of Tarnichane.
“The picture is not all roses,” he added.
More fuel is now needed to sustain production, which is interrupted by irregular petal deliveries, but the industry association’s calls for fuel subsidies have thus far gone unanswered by the government.
Rose oil production is expected to drop below its usual annual haul of 2.5 tonnes.
– Certified as ‘pure’ –
Nearly 100 percent of the oil produced in Bulgaria is exported to places such as France, Germany, Switzerland, the United States, China, Japan, South Korea and Taiwan.
Lissicharov is anxious about how the market will react to higher prices.
“There’s interest (from buyers),” he said. “But whether this interest will turn into deals depends on the price.”
To prevent counterfeit products from entering the market, the oil is certified by a few designated labs, such as the state Bulgarska Rosa Laboratory in Sofia.
The product leaves the lab in hermetically-sealed aluminium flasks with a label that guarantees “100-percent pure and natural genuine Bulgarian rose oil”.
Cutting corners, Stankovski said, is not an option: “Regardless of our troubles, we will preserve the high quality of the rose oil.”
Egypt’s small farms play big role but struggle to survive
Egyptian smallholders grow nearly half of the country’s crops, a lifeline role increasingly important after grain imports were stalled by war in Ukraine — but they are struggling to survive.
Despite their crucial role providing food for the North African nation’s 103 million people, smallholders are cash-strapped and indebted, frequently selling their harvests at a loss.
“The farmer is dead, trampled,” farmer Zakaria Aboueldahab told AFP, brewing tea on his rented plot of wheat and onions in Qalyubia, 30 kilometres (18 miles) north of Cairo.
“I’m trying to sell my onion harvest but I can’t find a market,” he said, the remnants of his crop scattered across the soil. “I just want to break even. I don’t know how I’m going to pay rent”.
His onions would sell in Egypt: but financing, marketing and infrastructure hurdles create massive gaps between supply and demand.
According to the United Nations Food and Agriculture Organisation (FAO), small farms are the “primary producers” of food for domestic consumption in Egypt.
Farmers cultivating less than three feddans (1.2 hectares, three acres ) — an area the size of a football pitch — till 35 percent of arable land.
Yet they produce some 47 percent of Egypt’s field crops, the FAO calculates.
Larger farms focus more on exports -– a dynamic that came to a head when Russia invaded Ukraine.
– ‘Patriotic duty’ –
Egypt, the world’s leading importer of wheat, relied on Russia and Ukraine for 80 percent of its imports, providing the flour for Egypt’s traditional flat bread.
Ordinary Egyptians eat bread at almost every meal, and Egypt’s wheat farmers ramped up production to 40 percent of the country’s needs.
“Without the 40 percent of wheat that we produce domestically,” rural sociologist Saker al-Nour told AFP, the consequences of the war “would be much worse.”
In March, Cairo ordered farmers to grow wheat, calling the “compulsory delivery” orders a “patriotic duty.”
By June, farmers had provided more than 3.5 million tonnes, according to the supply ministry, over half the domestic supply goal to August, and equal to the total amount supplied in 2021.
Compulsory crop deliveries were a pillar of president Gamal Abdel Nasser’s socialist policies in the 1960s, but those policies were dropped amid the structural adjustment programmes of the 1990s.
With them went the former subsidies on seeds, pesticides, and fertilisers which have steadily shrunk over the decades.
“Instantly, when things got tough, it went back to compulsory delivery, but this time without the services that came with it,” Nour said.
To encourage farmers to grow wheat, the government had previously set domestic prices higher than imports.
But the unprecedented surge in global prices undermined that.
– Stronger together? –
“Now I owe money to the pesticide guy, to the fertiliser guy,” Aboueldahab said. “So if someone comes along and bids a low price, what am I supposed to do?”
One solution is for smallholders to join together and harness the power of technology.
Entrepreneur Hussein Abou Bakr launched a start-up finance company called Mozare3, ‘farmer’ in Arabic, which offers farmers financing solutions and agronomy support.
It also helps farmers “become a bloc”, in the absence of effective local cooperatives and sets prices “as a form of protection” against market fluctuations.
Nour warns smallholders have “very limited negotiating power, especially when they don’t have the storage capacity for their harvest”.
But with illiteracy among smallholders at 32 percent, according to the FAO, offline village associations are necessary.
As climate change bites, Nour warns bottom-up approaches are essential.
These associations could, for example, communicate extreme weather events quickly and directly to farmers whose crops are at risk.
These tools exist, the sociologist said. “We just need to make them available to small farmers.”
Canada considers extending timeline for oil industry emission targets
Canada, the world’s fourth-largest oil producer, is considering pushing back its greenhouse gas reduction timeline for its oil industry, the environment minister told media Saturday.
The government recognizes that “some of the measures that will be needed to achieve those deep emission reductions might require more time than what we have between now and 2030,” observed Canadian Environment Minister Steven Guilbeault in an interview with CBC’s “The House.”
“There’s a possibility that if the industry needs a bit more time, then we can provide some flexibility while ensuring that Canada still meets its 2030 goals,” Guilbeault said.
Last year Prime Minister Justin Trudeau’s government announced an enhanced plan to comply with the Paris Climate Agreement, aiming for a 40-45 percent reduction in its greenhouse gas emissions by 2030 from 2005 levels.
The oil and gas industry, which makes up for more than a quarter of the country’s carbon emissions, is critical to achieving this goal, an interim target on the road to achieving carbon neutrality by 2050.
According to Guilbeault, Ottawa is willing to “allow the industry a bit more time if they need this time to deploy the necessary infrastructure that they need to reduce emissions.”
He did not specify how Ottawa planned to meet its 2030 international commitments if the oil and gas sector was allowed to push back its reduction targets.
Canada has never before met its previous greenhouse gas reduction targets.
The Pathways Alliance, a coalition of six Canadian oil producers, plans to reduce its CO2 emissions by 22 megatonnes by 2030, compared to a federal government target of 110 megatonnes, out of a total of 191 megatonnes emitted in 2019, according to CBC.
Snap to slow hiring after dismal earnings pummel stock price
Snapchat’s owner plans to “substantially” slow recruitment after bleak results Thursday wiped 25 percent off the stock price of the tech firm, which is facing difficulties on several fronts.
Snap reported that its loss in the recently ended quarter nearly tripled to $422 million despite revenue increasing 13 percent under conditions “more challenging” than expected.
A hit with young internet users in its early days, ephemeral messaging app Snapchat has remained a small player in the social networking space as competition has grown ever more intense.
“We are not satisfied with the results we are delivering, regardless of the current headwinds,” California-based Snap said in a letter to investors.
The firm pointed to a punishing confluence of increased competition, slowing growth of its revenue, “upended” advertising industry standards and macroeconomic woes.
Snap share price was around $12 in after-hours trading in the wake of the earnings report.
“Competition — whether it’s with TikTok or any of the other very large, sophisticated players in the space — has only intensified,” Snap chief financial officer Derek Andersen said on an earnings call.
“So it’s hard to disentangle the numerous factors here impacting what’s clearly a headwind-driven deceleration in our business,” he added.
The number of people using Snapchat daily grew 18 percent to 347 million from the same quarter a year ago, Snap reported.
Snap last month launched a subscription version of Snapchat as it looks to generate more money from the image-centric, ephemeral messaging app.
– Trouble on multiple fronts –
Snapchat+ is priced at $4 a month and will provide access to exclusive features. It said that these would include priority tech support and early access to experimental features.
The subscription version of the service made its debut in Australia, Britain, Canada, France, Germany, New Zealand, Saudi Arabia, the United Arab Emirates, and the United States, Snap said.
Snap in February reported its first quarterly profit, but two months later warned that it saw the economic outlook as having darkened considerably.
“It’s clear that the challenging economic environment continues to put pressure on Snap’s business,” said Insider Intelligence principal analyst Jasmine Enberg.
“Snap is also still reeling from the impact of Apple’s privacy changes, which have disproportionately impacted performance advertisers, creating a one-two-punch to its entire ad business.”
Apple rocked the digital advertising landscape by tightening privacy controls in the software powering its iPhones, letting users curb the tracking data used to target ads.
Snap is a small player in the online ad market, accounting for less than one percent of the money spent worldwide, which makes it more susceptible to such changes and challenges than internet giants such as Facebook-parent Meta, Eng said.
“It can be difficult to attribute deceleration to any one factor,” Andersen said. “But in order to keep growing, we’ve got to stay focused on the inputs that we control.”
Snap a while back recast itself as a “camera company,” fielding offerings such as picture-taking glasses called Spectacles.
“Long-term the most exciting opportunity is (augmented reality) and we’re investing heavily around the future of AR,” Andersen said.
Meanwhile, the battle for people’s attention online grows increasingly fierce as established titans such as Meta and Google adapt offerings to changing trends and relative newcomers such as TikTok grab the spotlight.
Anderson added that Snap intends to effectively pause hiring and look at reining in other expenses, joining a growing number of tech firms throttling back costs.
“We intend to substantially slow our rate of hiring to effectively pause growth in our headcount, which is a significant portion of our office,” he added.
Business2 months ago
Shanghai eases Covid curbs in step towards ending lockdown
Business2 months ago
Shanghai euphoria tempered by deep wound to China’s economy
Business1 month ago
How can organizations beat the digital transformation odds?
Technology4 weeks ago
Gartner: Cybersecurity predictions for 2022-2023
Technology2 months ago
Industrial Edge: The Energy Opportunity