Cinnamon FOB India & Vietnam: Mild Firming on Tight Cassia Exports

FOB cinnamon prices from India and Vietnam are edging higher in late May, with modest week‑on‑week gains across cassia and Ceylon grades amid firm export interest and seasonally tightening farmer stocks. The market is still fundamentally well supplied after last year’s record Vietnamese exports, but fresh customs data show a renewed surge in April shipments that is helping to put a floor under cassia values. In India, very hot and increasingly unstable pre‑monsoon weather in key southern spice belts, combined with firm demand for organic and Ceylon types, is limiting downside despite only incremental price moves. Over the coming three days, FOB offers in New Delhi and Hanoi are expected to remain slightly firmer to steady in EUR terms, with buyers advised to secure nearby coverage on dips rather than wait for any sizeable correction.

Prices & Short-Term Moves

(USD offers converted to EUR using an approximate rate of 1 USD ≈ 0.92 EUR.)

• India FOB New Delhi: organic cassia and Ceylon grades are up about EUR 0.05/kg versus mid‑May, reflecting firm export bids and limited farmer selling.
• Vietnam FOB Hanoi: cassia split and broken gained roughly EUR 0.05–0.08/kg over the week as export demand to India and China stays active following strong Q1–April shipment data.
• The overall tone is gently firm, with no sign yet of a sharp rally, but dips are becoming shallower as nearby demand meets cautious selling.

Supply, Demand & Trade Flows

Vietnam: exports re‑accelerate

• Vietnam posted record cinnamon exports in 2025 at about 120,000 tonnes and USD 300 million, with India absorbing nearly 38% of volumes.
• Fresh customs data for April 2026 show cinnamon and cinnamon‑flower exports of around 17,600 tonnes in the month, up more than 140% from March, with year‑to‑date volumes near 38,600 tonnes, slightly above last year.
• This strong shipment pace into Q2 underpins FOB offers even as farm stocks in key producing provinces (Quang Nam, Quang Ngai and the northwest) remain adequate after the large 2025 crop.

India: value‑added exporter & key buyer

• India acts both as a destination for Vietnamese cassia and as a re‑exporter of higher‑value Ceylon and organic cassia to Europe and North America.
• Export price statistics for Indian cinnamon show a multi‑year upward trend, reflecting solid overseas demand and a gradual move into higher‑value, certified supply chains.
• Current firming in New Delhi FOB levels is therefore more demand‑ than supply‑led, as buyers rebuild coverage after the mild softening seen in March.

Weather & Fundamental Risks (IN, VN)

• South India (Kerala, Karnataka, Tamil Nadu): pre‑monsoon conditions are hot and increasingly unstable. Forecasts for May 24–26 point to highs around 38–43°C, with scattered thunderstorms in parts of Kerala and interior Karnataka, and isolated storms in Tamil Nadu.
• While immediate harvest impact on cinnamon is limited, repeated heat spikes and erratic showers widen moisture and disease‑management risks in spice plantations, adding a modest weather‑risk premium to organic and Ceylon offers.
• Central Vietnam (Quang Nam, Quang Ngai): the next three days are forecast very hot, with highs around 38–41°C and only isolated thunderstorms.
• Such heat increases field‑work and bark‑drying costs, but with no acute damage reported, the main effect is to slow farmer selling rather than sharply tighten supply.

Market Drivers to Watch

• Vietnam export cadence: April’s sharp month‑on‑month jump in cinnamon exports suggests demand from India and China remains robust despite higher 2025–26 price bases. Any slowdown in May–June customs data would quickly cap further price gains.
• Macro & FX: global trade data show Vietnam’s overall exports remain strong in early 2026, supporting logistics and container availability for spices, while USD strength versus EUR keeps euro‑based buyers sensitive to even small FOB increases.
• Weather & El Niño risk: international agencies now assign a high probability (>80%) to El Niño forming during May–July 2026, which could later disrupt monsoon patterns in South Asia and rainfall in parts of Southeast Asia, turning the current mild firmness into a more pronounced weather‑driven up‑move if realized.

Trading Outlook (Next 1–2 Weeks)

• Buyers (food industry, packers):
  • Use any minor pullbacks to lock in Q3–Q4 coverage, especially for organic cassia and Ceylon from India and higher‑oil cassia from Vietnam.
  • For more commoditized splits and broken cassia, consider a staggered buying strategy (several small tranches) given the gently rising but still range‑bound market.
• Sellers (exporters, traders):
  • Maintain slightly firmer offers for nearby shipments; strong April export statistics justify holding levels, particularly for well‑cleaned, residue‑controlled lots.
  • Be ready to negotiate on forward positions if El Niño risks ease or if customs data show a pause in demand from India and China.
• Risk management:
  • Monitor South Asian monsoon updates closely; an erratic onset would likely lift the whole spice complex, including cinnamon.

3‑Day Regional Price Outlook (IN, VN)

• India – New Delhi FOB (organic cassia & Ceylon): mild upward bias of about +0.5–1.0% in EUR terms over the next three days, driven by hot pre‑monsoon weather and steady export enquiries.
• Vietnam – Hanoi FOB (cassia split/broken/cigarette): steady to slightly firmer (+0–0.5%) as exporters continue to execute strong April–May contracts and farmers sell cautiously in very hot conditions.
• Overall, no sharp volatility is expected in the next 72 hours, but the balance of risk remains skewed to the upside into early June.