Cinnamon FOB Prices Steady as Weak Monsoon Meets Firm Vietnam Supply

Indian and Vietnamese cinnamon FOB prices are broadly steady, with only marginal week‑on‑week moves and no immediate weather or demand shock strong enough to break the current range. Weak monsoon rains in Kerala and stable but seasonally warm conditions in Vietnam are being watched, yet short‑term export availability remains comfortable. For the next few days, price risk looks mildly skewed to the downside for Vietnam cassia grades and broadly sideways for Indian Ceylon and cassia. Indian domestic spot markets report largely stable cinnamon and other spice prices mid‑July, confirming a calm near‑term demand backdrop.  Weak southwest monsoon performance in Kerala, with a 31% rainfall deficit, is starting to raise concerns for plantation crops, but advisory notes so far focus on field management rather than yield losses.  Vietnam remains well positioned as the leading cassia exporter, supported by structured cultivation and certified supply chains.  Short term, logistics and weather forecasts around Kochi and Hanoi point to normal export operations without acute disruption. 

Prices

All prices below are indicative FOB levels converted to EUR (approx. 1 USD = 0.92 EUR) as of 18 July 2026.

• FOB India (New Delhi) Ceylon grades keep a clear premium of roughly 40–60% over Vietnam cassia bulk grades, in line with typical quality differentiation.
• Domestic Indian mandi indications for dalchini in Mumbai are also broadly stable mid‑July, suggesting limited downstream pressure to either restock aggressively or liquidate inventory. 
• Compared with late June, most cassia items from both origins are marginally softer in EUR terms due to earlier small USD price cuts and a broadly stable FX environment.

Supply & Demand

India: Cinnamon (both cassia and Ceylon) is a minor but high‑value spice crop within Kerala and adjoining states. Recent state reports highlight overall growth in spice production, though not specific to cinnamon, indicating an underlying positive supply trend.  For July, there are no confirmed reports of crop damage or labour disruptions in cinnamon‑growing belts.

Vietnam: Vietnam remains the world’s top cinnamon exporter, with annual output near 100,000 tonnes and exports above USD 270 million in recent years.  Vietnamese trade sources also emphasise India as a structurally important buyer of Vietnamese spices, including cinnamon, supporting steady export flows even when Western demand is mixed. 

• Export programmes from Vietnam are currently running normally, helped by predictable port operations and no near‑term policy shocks.
• In India, stable domestic prices and weak monsoon rains point to cautious medium‑term supply concerns but no immediate tightening of spot availability.
• Global demand in key consuming regions (EU, Middle East, South Asia) shows no evidence of a Q3 demand spike; current flows look seasonal and well covered by existing stock.

Weather & Crop Conditions (IN, VN)

India (Kerala & coastal spice belt): The southwest monsoon has underperformed so far, with Kerala showing a 31% seasonal rainfall deficit as of 14 July 2026.  State advisories to spice growers, including cinnamon, focus on drainage management and gap‑filling rather than emergency measures, signalling agronomic stress but not yet a production shock. 

National guidance suggests below‑average rainfall over southern peninsular India into late July, which could keep soil moisture below normal in plantation zones.  For established cinnamon trees, this mainly raises medium‑term risk (smaller twig growth and bark formation in 2027–28) rather than immediate 2026 harvest losses.

Vietnam (Hanoi & northern cassia belt): Short‑range forecasts for Hanoi point to typical midsummer conditions over the next few days, with warm temperatures, scattered showers and no severe weather alerts.  This is broadly favourable for ongoing bark harvest and drying, supporting smooth export pipelines.

Fundamentals & Short-Term Drivers

• Stocks: Certification data and trade commentary highlight significant organised cassia cultivation and carry‑over stock in Vietnam, cushioning any short‑lived harvest or logistics issues. 
• Monsoon risk premium: Weak rains in Kerala are starting to be priced into forward thinking for several plantation crops, but cinnamon’s small volume and current field guidance mean only a mild, longer‑dated upside risk rather than a near‑term spike. 
• Trade flows: Vietnam‑India spice trade is structurally strong and likely to expand, with cinnamon among the products showing notable export growth.  Short‑term, freight and port conditions are normal, keeping FOB‑to‑CFR spreads stable.
• Macro/FX: No abrupt currency swings have been reported in the last few days for INR or VND, so most week‑on‑week price changes reflect genuine market levels rather than FX noise.

Trading Outlook (Next 1–2 Weeks)

• Buyers (food manufacturers, packers):
  • For Vietnam cassia split and broken, consider scaling into coverage at current EUR levels; downside looks limited given strong structural demand and comfortable stocks.
  • For Indian Ceylon sticks and powder, maintain routine buying; premiums are stable and not yet reflecting the monsoon risk premium that could emerge if rainfall deficits persist into August.
• Producers/Exporters (IN, VN):
  • India: Avoid aggressive discounting; monitor monsoon developments, as any further deterioration could justify small upside offers for later‑season shipments.
  • Vietnam: Focus on quality differentiation (cigarette vs broken/split) to defend margins amid flat headline prices.
• Traders:
  • Short‑term, expect a narrow range trade; opportunistic buying on minor dips in Vietnam grades and selective long positioning in Indian Ceylon looks justified.

3-Day Regional Price Direction (EUR, FOB)

• India (New Delhi FOB, cassia & Ceylon): Sideways to mildly firm over the next three days. Weather news may support sentiment, but the physical market appears too well supplied for sharp moves in such a short window.
• Vietnam (Hanoi FOB, cassia split/broken/cigarette): Bias slightly soft to flat. Ample raw material and smooth logistics argue for continued competition among exporters, especially in lower grades.