Most buyers never see what happens between the tree and the chip on a retailer's shelf. We did. In Dianbai, Guangdong, we followed agarwood through the entire chain - the purchase of a standing tree, the saw and the axe, the moment a split trunk reveals its oil, and the workshop benches where resin is carved out by hand.
This is that journey, step by step.
Step 1: Buying the Tree
Harvesting starts with a negotiation, not an axe. Growers sell resin-bearing trees standing. The buyer inspects the trunk - old induction holes, resin staining, the tree's age and history - and makes an offer for the whole tree, on the spot.
The stakes are real. A tree with promising resin can cost a serious sum before anyone knows how much usable material is inside. One grower told us he had bought a tree expecting several hundred grams of top-grade material - and waited years for the answer the trunk would only give when it was cut open.
Step 2: Felling, Sawing, and Splitting
Once the tree is brought in, it is cut into short logs, and each log is split lengthwise with an axe. This is the moment of truth.
Fresh-cut agarwood shows two colors: the pale white wood that is worth almost nothing, and - where the tree defended itself - dark streaks of resin that growers call "fan you", the "returning oil." Reading those oil lines is a skill in itself. Their thickness, darkness, and coverage decide what the material becomes.
Step 3: Hand-Carving the Resin
Between the oil lines sits white wood that must go. Removing it is delicate handwork with a small hook-shaped blade - carve away the soft, pale wood, keep every dark fleck of resin. Too deep and the resin is damaged; too shallow and the material stays diluted and weakly fragrant.
Workshops call this gou xiang - "hooking the incense." A skilled worker can spend an entire day on a single kilogram of raw wood and yield only a handful of finished chips.
Step 4: Factory Sorting and Grading
Carved material moves to the finishing line, where workers sort chips into grades - by resin density, color, and aroma. This is where a single tree's output becomes dozens of separate lots at very different prices, from burning-grade chips to collector material.
The Yield Problem: Why Processing Explains the Price
| Stage | What is removed or kept | Rough share of the tree |
|---|---|---|
| Standing tree | Whole trunk, branches, roots | 100% |
| After splitting | Only wood with visible oil lines is kept | A small fraction of the trunk |
| After hand-carving | Only resin-rich chips remain | Grams to low kilograms per tree |
| After grading | Top grades only from the densest chips | A handful of pieces, if any |
Run the numbers and the price structure stops being mysterious. A tree that took six years to grow and years more to form resin might yield a few hundred grams of finished material - of which only a small part reaches high grades. Every remaining gram of white wood, sawdust, and scrap was paid for at the same tree price.
"A tree is heavy. Agarwood is not the tree. Agarwood is the few hundred grams the tree chose to defend itself with."
What Buyers Should Take From This
- Split faces are normal - raw material is split, not sawn, so irregular faces are a sign of correct handling, not damage
- Color alone lies - carved chips should show resin density, not just darkness; dyed low-grade wood exists and is covered in our scam-spotting guide
- Ask about the induction year - serious sellers know which year each block of trees was treated
- Weight pricing has logic - now that you know the yield chain, per-gram pricing reflects everything thrown away before the chip reached you
The next time you hold an agarwood chip, you are holding the endpoint of a six-year tree, a risky purchase, an axe blow, and hours of blade work. If you are curious where all of this happens at industry scale, continue with Inside Dianbai: China's Agarwood Capital - or discover what those finished chips become in The Agarwood Pillow: Nine Woods, Eleven Herbs.