Zuko refers to applying incense to a Buddha's statue or the body of a practitioner to cleanse impurities. It also refers to the incense. It is one of the six kinds of offerings for Buddha.
It is mixed and powdered with a few kinds of koboku (fragrant wood), and there are one dried as powder and another mixed with purified water to make pastille. It mostly refers to the powdered light brown incense as incense powder in general. Different from senko (incense stick) or shoko (burning incense) that is offered by smoking incense, it is the incense to put into the mouth and apply to the body.
It originates from India, and it is said that they took out fragrance from koboku to use to get rid of body odor by applying to the body.
It is said that this developed into the sense of cleansing the body or holding off bad vibes, which was adopted by Buddhism
It is mostly done before beginning ascetic practices or holding a Buddhist memorial service. Though it depends on the religious school, it is generally done first by holding a little pinch of zuko in the left hand, applying a little to the right index finger and middle finger and putting it into the mouth. Next, the incense is rubbed a few times on both hands, and later, it is applied to the chest (actually on the robe) with the hands. It is supposed to cleanse three kinds of Karma - actions, words and thoughts.
India, which is a tropical country, often produces foul odors in life. So, zuko has a function to take away this heat agony, and to cool down. This clean advantage of zuko leads to getting rid of heat agony of human's earthly desires and freshening up, and it also has the instructions followed, which is said to correspond with Jikaigyo (to keep the precepts of Buddhism).
It is often used in Esoteric Buddhism. Lay believers sometimes use it before copying a sutra.