Cinnamon Prices Edge Higher on Firm Cassia Demand in India and Vietnam

Indian and Vietnamese cinnamon (cassia) export prices are edging higher, with modest week-on-week gains across most grades. Indian organic cassia and Ceylon types from New Delhi are firmer, while Vietnamese cassia grades from Hanoi continue a steady upward grind driven by export demand and tightening farmgate availability. Weather in key growing regions of Kerala and Vietnam’s Central Highlands is seasonally wet but without acute harvest disruption in the very short term, keeping the bias mildly bullish rather than explosive. Cinnamon markets in India and Vietnam are entering September with a firm tone as buyers start to position for Q4 demand from food, beverage and pharmaceutical sectors. In India, export-level prices are supported by limited high-quality organic material and a still-cautious farmer selling pace. In Vietnam, cassia exporters report steady overseas interest while monitoring heavy-rain alerts for Central Highlands and central coastal provinces. Logistics remain manageable, but any intensification of localized flooding would quickly tighten nearby supply and freight availability.

Prices

All prices below are approximate FOB, converted to EUR at 1 USD ≈ 0.92 EUR.

Export reference data for India indicate average cinnamon values near USD 7.8/kg (≈ 7.18 EUR/kg), slightly below last year but broadly aligned with current high-end offers for organic and Ceylon material.

Supply & Demand

India remains a mid-sized cinnamon exporter but an important supplier of high-value organic and Ceylon grades, with 2024 exports around 603 tonnes and an export unit value near USD 7.8/kg. Tight availability of certified organic cassia and Ceylon lots underpins the premium over bulk Vietnamese cassia, even as overall export volumes are modest.

Vietnam, a key producer of Saigon cinnamon (C. loureiroi), continues to dominate global cassia-oriented trade. Recent alerts from Vietnam’s national meteorological service point to heavy convective rains and localized flood/landslide risk in Central Highlands provinces such as Gia Lai and Lâm Đồng, as well as in parts of the south, for early September. While processing clusters near Hanoi draw raw material from northern provinces, these conditions may slow movement from upland farms, lending support to nearby prices.

On the demand side, food and beverage consumption in major importing regions remains solid, and manufacturers are starting to cover Q4 requirements. With India’s export prices still slightly below last year on a unit-value basis but trending higher month-on-month, overseas buyers are taking advantage of current levels to extend coverage, particularly for organic and traceable origin programs.

Weather Outlook (IN, VN)

In Kerala, a core cinnamon and spice-growing belt, 5–10 day forecasts for locations such as Kodungallur, Ottappalam and coastal Kerala indicate warm, humid conditions with maximum temperatures around 30–32°C, high humidity and scattered showers but no severe, widespread weather warnings through at least September 6. This environment is typical for the transition from the southwest to the northeast monsoon and should allow field and post-harvest operations to continue with only minor interruptions.

In Vietnam, regional forecasts for Central Highlands and central coastal areas including Kon Tum and Quảng Ngãi show episodes of showers and thunderstorms with locally heavy rain through September 6, embedded within a broader alert for intense downpours, thunderstorms, strong gusts, and potential flash floods or landslides. These conditions could briefly hamper transportation from highland plantations to lowland collection points but are not yet signaling a widespread, long-duration harvest disruption.

Fundamentals & Market Drivers

• Gradual price firming: Both Indian and Vietnamese cinnamon benchmarks have gained around 0.6–2.1% over the last week across types, indicating a steady, not speculative, uptrend.
• Quality differentials: Ceylon and organic cassia from India continue to command a sizable premium over Vietnamese conventional grades, reflecting species differences and certification costs rather than short-term scarcity alone.
• Seasonal rains: Normal to slightly heavy rainfall in Kerala and in Vietnam’s cassia-growing uplands is adding some logistical friction but also supporting tree growth and future bark yields, limiting immediate upside.
• Macro and FX: With export benchmarks commonly quoted in USD, any further EUR softness would mechanically increase landed EUR prices for European buyers even if USD offers stabilize.

Trading Outlook

• Short-term buyers (Q4 coverage): Consider advancing purchases of Indian organic cassia and Ceylon grades while the current uptrend is still moderate. Partial coverage now, with a review in 2–3 weeks, balances price risk and potential weather-related supply noise.
• Bulk cassia users: For Vietnamese broken and split grades, incremental price strength and Central Highlands rain risk argue for at least 50–60% coverage of near-term needs, especially for buyers exposed to container delays.
• Origin diversification: Blenders and industrial users may benefit from mixing higher-priced Indian Ceylon with competitive Vietnamese cassia to manage recipe costs while preserving flavor profiles.
• Producers and exporters: Indian and Vietnamese sellers can maintain a mildly bullish offer stance but should remain flexible on shipment windows given weather-related logistics, especially from upland origins.

3-day Price Direction (FOB, EUR)

• India – New Delhi (organic cassia & Ceylon): Mildly bullish bias over the next 3 days, with potential gains of around 0.5–1.0% as buyers continue to book Q4 coverage and high-quality volumes stay limited.
• Vietnam – Hanoi (cassia cigarette, broken, split): Slightly firm to stable-firm over the next 3 days, with an upside skew of about 0.5–1.5% driven by export demand and localized transport disruptions in rain-affected hinterlands.