Shellac is scraped from the bark of the trees where the female lac bug, Kerria lacca, secretes it to form a tunnel-like tube as it traverses the branches of tree. These tunnels referred to as “cocoons”, but they are not literally cocoons in the entomological sense. The insects suck the sap of the tree and excrete “stick-lac” almost constantly.
The raw shellac, which contains bark shavings and lac bug parts, is placed in canvas tubes and heated over a fire.
This causes the shellac to liquefy, and it seeps out of the canvas leaving the bark and bug parts behind. The thick sticky shellac is then dried into a flat sheet and broken up into flakes when dried, and then bagged and sold. The end-user then mixes it with denatured alcohol in order to dissolve the flakes and make liquid shellac.