c2022-03-10 Tridge Co.

, LTD

March 2022

2022 Market Report:

Cinnamon

Intelligence & Solutions

 2

Executive Summary

Production • World cinnamon production is dominated by only four countries, Indonesia,

China, Vietnam, and Sri Lanka. The four countries produced 98% of the
and Export world’s cinnamon in 2020.

• The main species of cinnamon grown in Sri Lanka, commonly known as

Ceylon cinnamon (Cinnamomum verum), has a higher value than the most
predominant species grown in the other top 3 countries.

• Global cinnamon production peaked at 242,635 mt in 2019 and dropped

back to 222,122 mt in 2020. Chinese cinnamon production boomed to
82,837 mt in 2019 but fell slightly in 2020.

• Cinnamon exports have increased along with production, and 197,762 mt

was exported in 2020. China is the world’s largest exporter, surpassing
Indonesia in 2017. Sri Lanka exported only 10% of exports in volume but 21%
in value.

Import and • The US, the largest importer of cinnamon, imported USD 154 million in
2020. They had a market share of 18% in global imports in value. The US
Demand imports mainly from Indonesia.

• India, the world’s second-largest importer, imported USD 108 million in

2020. India mainly imports from Vietnam.

• Mexico prefers to import the high-valued cinnamon from Sri Lanka. In value,
Mexico imported USD 59 million in 2020, gaining the third spot in global
imports.

Recent • Cinnamon prices have been comparatively low throughout 2020 and 2021,
leading to less cinnamon being harvested. Especially in China, traditional
Developments cinnamon harvesters turned to more profitable crops, leading to a 12%
decrease from 2019 to 2020.

• Throughout 2021 prices were reasonably low. Very few major producing
countries have released production figures for 2021, but a significant
increase in global production is not expected.

• However, prices increased in late 2021 as demand for cinnamon increased

with lifts in covid-19 restriction, while supply was limited due to low
production in the last two years.
Contents

Part I - Product Information·················································································· 4

1.1 Cultivation and Production

1.2 Supply Chain

Part II - Global Market Dynamics ····································································· 14

2.1 Production

2.2 Exports

2.3 Imports

Part III - Developments in Major Producing and Importing Countries ·· 22

3.1 Sri Lanka

3.2 Mexico

3.3 China

3.4 Indonesia

Part IV - Sources ··································································································· 22

Part I

Product Information

1.1 Cultivation and Production

1.2 Supply Chain
Part. I 5

Product Information

Cinnamon refers to the dried bark of trees from the genus Cinnamomum,
and in general, cinnamon refers to any species inside the genus. There are
different species within the genus, but only four are economically significant.
These species are listed below:

Table 1. Cinnamon Species

Common Name Scientific Name (Sub Species) (Sub Species)

Common Name Scientific Name

Ceylon Cinnamon, Cinnamomum

Sri Lankan Cinnamon verum
True Cinnamon

Cassia Cinnamomum Chinese Cinnamomum

cassia Cinnamon aromaticaum

Korinthe Cinnamomum
Cinnamon burmannii
Java Cinnamon
Indonesia
Cinnamon

Vietnamese Cinnamomum
Cinnamon loureiroi
Saigon
Cinnamon

When translated, the scientific name, Cinnamomum verum, means “true

cinnamon” when translated. In some regions, only Cinnamomum verum is
called “cinnamon,” and other categories are called “cassia.” Yet, “cinnamon”
refers to all species within the genus Cinnamomum in other areas.
Trade data usually use “cinnamon,” as is the latter, where products from the
species Cinnamomum are grouped under HS Code 0906: cinnamon and
cinnamon-tree flowers.

This report uses “cinnamon” in harmony with trade data. Thus, in this report,
“cinnamon” refers to products from any tree within the genus Cinnamomum,
unless otherwise specified.
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Part. I Product Information

Cultivation and Cinnamon is a hardy plant that can tolerate harsh conditions and the
regular harvest of branches. Cinnamon trees do better in hot and wet
Production conditions and perform best in 27° - 30°C, with high rainfall of 2,000mm -
2,500mm per year. Despite the high water requirements, well-drained soil
is essential because waterlogged conditions cause the bark to become
bitter.

Cinnamon trees are coppiced when they reach two years of age. This
results in more tender shoots growing from the rootstocks, which allow for
a more significant and more constant cinnamon harvest.

Figure 1. Coppicing a Tree1

Figure 1. Source: Farmer’s

Weekly (Modified Image)

Two years after the trees are coppiced, the shoots can be harvested. If the
trees are well maintained, shoots can be harvested every eight months.
Straight shoots are preferred because it makes removing the outer bark
easier. Removing the bark is still often done by hand. The inner bark is what
will become the spice known as cinnamon. The inner bark is removed in
thin quills, with thinner quills getting higher prices. Next, the quills are dried
and packed into bales, after which they are sent off for grading and further
processing.

1 Image does not illustrate a cinnamon tree

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Part. I Product Information

Supply Chain Cinnamon production is predominantly done on small-scale family

smallholdings in all major producing countries, with relatively few large
orchards. For example, in Sri Lanka, of the estimated 70,000 plantations,
80% are family-owned smallholdings.

In most regions, once the cinnamon is harvested and the bark stripped and
dried on the farm, the cinnamon bales are collected from smallholdings by
local collectors. Then, local collectors sell to larger collection centers, which
sell to processors and exporters.

In most cases, cinnamon is exported in bulk. Further processing and

packaging primarily happen within the importing countries. However,
processed and packed cinnamon exports are increasing, as labor costs in
most cinnamon-producing countries are cheaper than in most importing
countries.

Figure 2. The Main Actors Involved in Sri Lanka's Cinnamon Supply Chain

Figure 2. Source: Tridge

Part II

Global Market Dynamics

2.1 Production
2.2 Exports
2.3 Imports
Part. II 9

Global Market Dynamics

Production As suggested by the common names of cinnamon, production is centered

around Indonesia, China, Vietnam, and Sri Lanka. These countries make
up 98% of cinnamon production. Chinese cinnamon production has
increased yearly for at least two decades, almost surpassing Indonesia,
the world's largest cinnamon producer. However, there was a steep drop
in production in 2020. In addition, cinnamon prices were lower in 2020,
leading to less cinnamon being harvested, especially in China.

Figure 3. World Cinnamon Production

Figure 3. Source: FAOSTAT

Figure 4. Indonesia and China Cinnamon Production

Figure 4. Source: FAOSTAT

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Part. II Global Market Dynamics

Exports China is the world's largest exporter of cinnamon and had a market share
of 44% of global exports on a volume basis in 2020. On the other hand,
Sri Lanka only made up 10% of global exports in 2020 on a volume basis.
However, Sri Lanka had a 21% market share of global exports in value. The
significant market share in value is because Sri Lanka mainly produces
Ceylon cinnamon, or true cinnamon (Cinnamomum verum), which has a
higher market value than other species.

The price of cinnamon and the value of exports has increased rapidly
in all of these significant exporting countries. Most notably, exports
in uni value have more than doubled in the last five years in Vietnam
and Indonesia. However, prices dropped significantly due to the global
pandemic in 2020, especially in Vietnam.

Figure 5. World Cinnamon Exports by Volume (MT) 2020

Table 5. Source: ITC Trade Map

Figure 6. World Cinnamon Exports by Value (USD '000) 2020

Table 6. Source: ITC Trade Map

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Part. II Global Market Dynamics

Imports On a volume basis, global cinnamon imports were 197,762 mt in 2020,

increasing 27% from five years before. However, the value of imports
nearly doubled over the same time. As a result, imports in value were USD
832 million in 2020, 88% higher than five years ago.

Figure 7. World Cinnamon Imports by Volume and Value1

Table 7. Source: ITC Trade Map

Nearly every country in the world imports cinnamon, but the top 5
importers had a market share of 46% in 2020. The US is the largest
importer, buying primarily from Indonesia, and 62% of US cinnamon
imports came from Indonesia in 2020. India, the second-largest importer,
imports mainly from Vietnam, and 85% of Indian cinnamon imports came
from Vietnam in 2020.

Figure 8. World Cinnamon Imports by Volume and Value

Table 8. Source: ITC Trade Map

1 Volumes for 2014 not complete. Export volume mirror data used
for 2019 and 2020
Part III

Developments in Major Producing

and Importing Countries

2.1 Sri Lanka

2.2 Mexico
2.3 China
2.4 Indonesia
Part. III 13

Developments in Major Producing and

Importing Countries

Sri Lanka Cinnamon from Sri Lanka is arguably the most renowned cinnamon. As
the name suggests, Sri Lanka grows almost exclusively Ceylon cinnamon
(Cinnamomum verum), which has a higher value than other species
from the genus Cinnamomum. As a result, the unit value of exports of
cinnamon from Sri Lanka is far higher than that from China and Indonesia,
while reported exports from Vietnam are unpredictable.

Figure 9. Unit Value of Cinnamon Exports1

Figure 9. Source: ITC Trade Map

Sri Lanka exports mainly to the Americas, and the top five destinations
are Mexico, the US, Peru, Columbia, and Ecuador. Sri Lankan cinnamon
is shipped globally, but the top five destinations had a 75% market share
in 2020 in export value. Mexico is the largest market for Sri Lankan
cinnamon and had a 35% market share in 2020.

According to the Sri Lanka Export Development Board, cinnamon exports

for the first three-quarters of 2021 are up by 10.33%. Sri Lanka’s Spice
and Concentrate exports were USD 320.8 million for the first three-
quarters of 2021, 37% higher than over the same period last year. Spices
include pepper, cinnamon, cloves, nutmeg, etc.

1 Vietnamese data for 2012 and 2014 unavailable

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Part. III Developments in Major Producing and Importing Countries

Figure 10. Sri Lanka's Spice and Concentrate Exports

Figure 10. Source: Sri Lanka Export

Development Board

Mexico Mexico is the third-largest importer of cinnamon in value and lost the
number two spot to India in 2019.

Sri Lanka is Mexico’s leading supplier, and in 2020, 91% of Mexico’s

cinnamon imports came directly from Sri Lanka. Cinnamon is popular in
many Mexican cuisines and drinks, especially milky drinks like horchata
or atole de canela. In addition, Mexicans prefer Ceylon cinnamon to other
varieties due to its sweeter and more delicate taste. Consequently, the
value of Mexico’s imports is comparatively high.

The value of imports decreased in 2019 and 2020. In 2020, Mexico

continued to import cinnamon for Sri Lanka, but because prices dropped
for nearly all cinnamon, Mexico purchased Sri Lankan cinnamon at lower
prices.

Figure 11. Sri Lanka's Spice and Concentrate Exports

Figure 11. Source: ITC Trade Map

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Part. III Developments in Major Producing and Importing Countries

China China’s cinnamon exports surged in recent years due to increased

production. However, as production fell in 2020, exports also tumbled.
In addition, cinnamon prices were lower in 2020, which resulted in much
less cinnamon being harvested in China.

Over the last four years, exports to Vietnam boomed, and in 2020, 31% of
Chinese cinnamon exports went to Vietnam, and in the first eight months
of 2021, 37%. Furthermore, as Vietnam is developing as an agricultural
processing and export hub, cinnamon from China’s neighboring provinces
flows through Vietnam.

Figure 12. China's Cinnamon Exports

Figure 12. Source: ITC Trade Map

Figure 13. China's China's Monthly Cinnamon Exports

Figure 13. Source: ITC Trade Map

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Part. III Developments in Major Producing and Importing Countries

Indonesia Indonesia was the only major producer that harvested more cinnamon in
2020. Production in 2020 was 91,242 mt, compared to 89,657 mt in 2019.
However, the volume of Indonesian cinnamon exports has decreased
since 2014 (except for 2017). The decrease was due to reduced demand
in the US, the leading importer of Indonesian cinnamon. The trend is set
to continue in 2021, as exports for the first half of the year are 15% lower
than the first half of last year.

Figure 14. Indonesia's Cinnamon Exports

Figure 14. Source: ITC Trade Map

Figure 15. Indonesia's Cinnamon Exports

Figure 15. Source: ITC Trade Map

Part. IV 17

Sources

NBCI. Differentiation of the Four Major Species of Cinnamons (C. burmannii, C. verum, C. cassia, and C. loureiroi)
Using a Flow Injection Mass Spectrometric (FIMS) Fingerprinting Method

ITC Trade Map

Sri Lanka Export Development Board. Exports Earn Nearly One Billion Dollars in September 2021

Tridge. Analysis on the Cinnamon Industry in Sri Lanka

IPS. Analysis of Cinnamon, Pepper and Cardamom Value Chains in Sri Lanka

Spice Factors. Chinese Cassia Prices Show Sharp Upturns

March 2022

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