22  ASIA OCEANIA BIOSCIENCES AND BIOTECHNOLOGY CONSORTIUM AGARWOOD PRODUCING FUNGAL INOCULANT FORMULATION IN KETIMUNAN TREE (Gyrinops versteegii DOMKE) I Made Mega 1 *, Dewa Ketut Suanda 2 , Desak Nyoman Kasniari 1 , and I Gede Ketut Susrama 3 1 Soil and Environment Department, Agroecotechnology Study Program, Faculty of Agriculture, Udayana University, 2 Professor in Agronomy, Agronomy and Horticulture Department, Agroecotechnology Study Program, Faculty of Agriculture, Udayana University 3 Agricultural Pests and Diseases Department, Agroecotechnology Study Program, Faculty of Agriculture, Udayana University, * Corresponding author: mega_made@yahoo.com ABSTRACT This study aimed to find out the agarwood producing fungal inoculant formulation that infect Ketimunan tree (Gyrinops versteegii DOMKE) effectively and resulted in high quality of agarwood. Randomized Completely Block Design was applied in this study with formulation of Fusarium solani and Rhizopus sp inoculant in liquid and solid form were combined as treatments. Treatments were: solid Fusarium solani inoculant, solid Rhizopus sp inoculant, mixture of solid Fusarium solani inoculant and solid Rhizopus sp inoculant, liquid Fusarium solani inoculant, liquid Rhizopus sp inoculant, mixture of liquid Fusarium solani inoculant and liquid Rhizopus sp inoculant, and mixture of solid and liquid of Fusarium solani and Rhizopus sp inoculants. There are three replicates for each treatment. Parameters measured were level of fragrance, agarwood color, and its resin content. The result showed that all formulations affected resin content significantly compared to control of agarwood. Mixture of liquid Fusarium solani and liquid Rhizopus sp inoculant showed the best quality agarwood with quality characteristics: brownish black or agarwood with black and brownish- black color, very strong fragrance, and with 13.58% resin content. Key words: agarwood forming fungi, Gyrinops versteegii INTRODUCTION Agarwood is one of economically valuable forestry products and also as an export commodity. According to Indonesian Forestry Department that since 1997 until September 2001, Indonesian agarwood export volume tends to decreased from 328,496 tons in 1997, 313,308 tons in 1998; 308,186 tons in 1999; 144,852 tons in 2000, and 184,069 tons in 2001. Agarwood selling price is very attractive, recently reached 50 million IDR per kilogram in international market. Furthermore, the selling price of agarwood continuously increases due to increasing demand of agarwood around the world. In Saudi Arabia, for example, agarwood become the requirement of every household (Paimin, 2004). Agarwood has a lot of uses in human life such as 1) industrial raw material of perfumes, fragrances and cosmetics, 2) material for religious ritual activities, 3) as raw material of many kinds of natural healing medicines namely: anti- asthmatics, anti-microbe, nerve stimulant, stomach ache medicine, sex stimulant, pain killer, cancer drug, renal medicine, relieving stress, liver drug, malaria and diarrhea medicine (Sumarna, 2002). Based on the result of phytochemical analysis, it is known that agar wood leaves containing phenol, flavonoid and steroid (Mega and Swastini, 2010). Agarwood export from Indonesia was increasing until year 2000, however then agarwood production has declined