From Woodturner's Reference (link below):

SHELLAC Shellac is has been used for many hundreds of years and was used by the Egyptians, Greeks and Romans for a wide range of applications. It is used in all areas of woodworking to provide a hard workable finish. originally imported from India as Dye known as Lac, in the late 1800s a new process was developed in England using Lac and a resin to produce Shellac this new varnish was then used extensively in French Polishing techniques throughout the furniture industry and soon became more widely used than the hitherto Beeswax polishes and although now superseded by modern cellulose and polyurethane finished it is still often used by the more skilled restoration woodworkers. Two insects have been responsible for the development of wood finishes i.e. the Bee for beeswax and the Laccifer Laca (Lac Beetle) for Shellac and it is the female of both species that provides the wax or Lac. The Lac beetle larvae is about an 1/8th of an inch long and as a parasite attaches itself to young branches of trees and shrubs from which they extract the sap. This sap covers the larvae as a result of the action of secretion glands and after about 8 weeks the insect becomes much larger and covered with a brownish hardened varnish, the encrusted twigs are then harvested dried, washed crushed, and sieved to remove impurities and the end product is known as Shellac Flakes. The Shellac Flakes can be mixed with spirits and when applied to wood as a finish the spirit quickly dissolves to leave a very hard shiny surface finish.