Championing cinnamon

•  Own logo and branding from May for Sri Lanka’s most popular spice export

By Cheranka Mendis

The much-debated and looked-forward-to value addition for Sri Lanka’s most popular spice export, cinnamon, will be in place this May, with the Government finally consenting to give the industry its own logo and branding.

EDB Chairman Janaka Rathnayake

Sri Lanka cinnamon, which has secured 95 per cent of the world market, will launch a special ‘lion logo’ and market under the brand name ‘Ceylon Cinnamon,’ going down the same line as ‘Ceylon Tea’.

EDB Chairman Janaka Rathnayake said yesterday President Mahinda Rajapaksa has granted approval for the logo, and the industry would see the final logo by end May. The logo will be revealed at the Presidential Secretariat, he said.

“It is important to brand our product, especially since Sri Lanka is the largest contributor to the world cinnamon market,” Rathnayake asserted.

The industry has brought in revenue of US$ 83 million in 2010.

Chairman of The Spice Council D.A. Perera speaking to Daily FT yesterday confirmed the ‘new look’ and noted that it would be a good marketing tool for the industry to further its presence in the global market.

Botanically named as Cinnamomum zeylanicum, ‘Ceylon Cinnamon,’ even with a price that is four times that of its competitor from China and Indonesia – Cinnamon cassia – has been able to secure and hold on to the larger share of the world market.

Perera asserted that the cinnamon industry had fared well within the past few years with prices for cinnamon increasing by 40 per cent within the past two years. Production however has shown a decrease with local production moving from 12,000 tonnes a year two years back to 11,000 tonnes in 2010. The decrease is attributed to climatic changes and malpractices in production.

“People are not using proper methods and fertilisers needed for a good crop due to the high price slapped on fertilisers,” Perera said. 

He expressed that the increase in demand was due to the therapeutic and nutraceutical value of cinnamon reaching a large population of the world.

“The Government has given Rs. 25 million to conduct clinical trials in finding out the relationship between cinnamon intake and its effects in lowering the diabetic conditions of the patient,” Perera said. He stated that the fund would be given out over a period of three years starting 2010.

“The industry received Rs. 8 million in 2010, will receive another Rs. 8 million this year and Rs. 9 million in 2012. A total of 3,000 patients will be used for the trials and a committee consisting of qualified personnel from The Spice Council, Department of Agriculture, Peradeniya University, Peradeniya Medical Faculty and Health Department will be working in this endeavour.”

Commenting on key challenges hindering the industry, Perera responded that the lack of peelers was the main concern for exporters. “We are looking at introducing a process of semi mechanisation of peelers,” he claimed.

The council is working with the UN in realising this task and a survey at the cost of US$ 30,000 is being conducted at the moment by the UN. The bottom-line objective of the survey is to establish a training academy for peelers in Sri Lanka.

“If the results of the survey are positive towards the establishing of the training centre, the UN will give a minimum of US$ 800,000 for just the training and if proved successful, will invest in a full-scale laboratory and a pilot plant.”

Land area for the project has not been identified yet, but the council is looking at putting down Rs. 3 million of its savings to buy suitable land. Perera assured that it was highly likely that the plant would come up in the southern part of Sri Lanka.

The cinnamon trade, with its direct and indirect involvement of an approximate 450,000 people and located in some 32,000 hectares, also needs to intensify its value addition process, he said. “The Government should take more interest in this spice, which is the largest producer of the market. More research and development must be done and its medicinal values must be identified and popularised,” Perera stressed.

Past Chairman of The Spice Council Sarinda De Silva added that all certificate mark criteria and legislation for the new look was now ready and in place. “Cinnamon is virtually the only trade that has a monopoly power in the global trade market. The biggest concern for exporters is maintaining quality amidst bad agronomic practices by small holders and the lack of peelers,” De Silva said.

He asserted that from the 32,000 hectares of cinnamon, only 40% is peeled twice a year – the ideal practice. From the remaining, 50% is peeled once a year and 10% once in 16-18 months.

“The bulk of the peeling is not being harvested. If done properly, within two years we can double our production.”

He assured that following on the doubling of prices in 2010, bringing in more revenue to the country, 2011 would ride on high prices as well.