Cinnamon Prices Flat as Monsoon Risks Loom in India and Vietnam

Cinnamon export prices from India and Vietnam are holding flat into early August, with no immediate sign of tightness despite monsoon-related risks. Stable FOB offers suggest a brief consolidation phase after mild softening in July, while buyers remain cautious ahead of peak demand later in Q4. Underlying fundamentals point to balanced nearby supply: growers in India and Vietnam report adequate stocks and normal trade flows, and no fresh weather shocks have yet emerged in the main cassia and Ceylon regions. However, forecasts of a less reliable second-half monsoon in India and hot, stormy conditions in northern Vietnam keep weather risk firmly on the radar. For now, the market appears comfortable with current levels, but any confirmation of yield loss or logistic disruption could quickly lift premiums, especially for organic and higher-grade material.

Prices

FOB offers in New Delhi and Hanoi for cinnamon and cassia have been unchanged since mid-July in USD terms, and show no week-on-week movement into 1 August 2026. Converted at ~0.92 EUR/USD, current indicative levels are:

The modest easing versus early July reflects earlier surplus availability of cassia in Vietnam and slightly softer Indian spice complex sentiment, while the last three weekly quotations are flat, signalling a short-term price floor.

Supply & Demand

India’s broader spice exports continue to grow in value, driven by steady overseas demand for premium and organic categories, including cinnamon, though the latest official export bulletin relates to the 2024–25 marketing year rather than the current quarter. Recent trade commentary still describes cassia and cinnamon export demand as stable rather than surging, with no acute shortage signals in the main consuming markets.

Vietnam retains a strong position in cassia (Saigon cinnamon) exports, with certified supply chains in the north-central provinces underpinning year-round availability. A recent certification document confirms sizeable cultivated volumes of cassia bark in Vietnam in 2026, supporting the view of comfortable raw material supply this year, even if on-farm stocks tighten seasonally between harvest windows. With inventories adequate and buyers in the US, EU and Middle East well covered for the near term, the current flat FOB profile is consistent with balanced fundamentals.

Weather & Production Outlook (IN, VN)

For India, medium-range monsoon assessments issued in late June and early July point to a somewhat weaker second half of the southwest monsoon (August–September) versus the long-period average, raising concerns about moisture stress in some spice-growing belts if rains underperform. While cinnamon is less water-sensitive than some plantation crops, prolonged rainfall deficits in Kerala and adjoining Western Ghats could affect bark quality and growth rates later in the season, potentially tightening high-grade Ceylon and organic supply in early 2027 if the pattern persists.

In Vietnam, current local reports for Hanoi and northern regions describe typical August conditions: very warm, humid weather with frequent showers and thunderstorms rather than continuous heavy rain. Travel and resident commentary over the past week suggests that, despite uncomfortable heat and intermittent downpours, day-to-day logistics remain workable. For now there are no confirmed storm events or flooding in early August 2026 comparable to past disruptive years, so harvest and transport operations for cassia in the key producing provinces should continue with only routine monsoon delays.

Fundamentals & Market Drivers

• Stocks and certification: Certified cassia volumes in Vietnam and sustained cultivation confirm a structurally strong export base for 2026, dampening any near-term shortage fears despite localized weather risks.
• Macro spice demand: Broader Indian spice exports have shown resilient value growth, supported by rising demand for organic and value-added products, which underpins premiums for organic cinnamon grades.
• Weather risk premium: Forecasts of a less reliable late monsoon in India and typical hot, stormy August weather in northern Vietnam keep an upside risk premium alive, especially for specialty grades and long positions into Q4 baking season.
• Speculative interest: There is little evidence in recent commentary of large speculative positions in cinnamon specifically; price action instead reflects physical fundamentals and cross-spice sentiment from pepper and other plantation crops.

Short-Term Trading Outlook

• Importers (EU / Middle East): With flat FOBs in India and Vietnam and no confirmed weather shock, near-term coverage for Q3–early Q4 looks safe at current EUR levels. Consider layering in additional coverage for organic and Ceylon grades on any minor dips, as these segments are most vulnerable to later monsoon or input-supply issues.
• Exporters (IN, VN): Maintain offer discipline; aggressive discounting appears unwarranted given balanced fundamentals and latent upside risk. For Vietnam cassia broken and splits, current EUR/kg levels already factor in earlier softness; tightening offers ahead of any storm-related logistics issues could be justified.
• Industrial users / blenders: Use the present stability to diversify origins between India and Vietnam to hedge regional weather risk. For 2027-forward contracts, build in modest weather premiums, especially if Indian rainfall shortfalls materialize in August–September.

3-day Directional Price Indication (EUR, FOB)

• India – New Delhi FOB (cassia & Ceylon, organic): Sideways over the next 3 days, with EUR/kg indications expected to remain within ±0.5% of current offers as trade waits for clearer monsoon signals.
• Vietnam – Hanoi FOB (cassia split, broken, cigarette): Sideways to marginally firm bias; prices are likely to hold within ±0.5% of current EUR/kg levels, with any firming driven more by freight and short-term logistical delays than by structural supply tightness.