On the porch of the new Cassia Spring Crop 2020, let’s look back on the previous year 2019 for cassia cinnamon, to follow in the next article with our update about the current and coming market as we enter the new decade, a decade of great changes since its first days.
In general, the overall trend in 2019 is an upward price line, the continue of previous years where we see the price of cassia in Vietnam keep marching up. In the past, the price of Vietnam cassia used to be lower than Indonesia, but it has raced and gradually closed the gap with Indonesia cassia. 2019 marked its new record where all product categories were no longer with the same price they used to be, reaching up to their highest levels ever before. Exporters who signed future contracts with fixed price met with great difficulty to deliver the shipments due to the rising price of materials, ending at losses or cancellation.
The total volume of raw material output in 2019 has increased but cannot supply the strong demand of the world markets, especially India. As Indonesian cassia was less available in the market; Indian and Chinese buyers had turned to Vietnam and actively sourced the alternative materials, mainly the high oil content products (2-3% oil quality), pushing up local prices and put the market in shortage condition. To take advantage of the high price, farmers rushed to harvest their hills, even cut down the very big old trees which meant to be kept to produce seeds.
The total export volume of Vietnam cassia cinnamon in 2019 is approx 60,000MT, increasing around 15% YOY. The cultivating areas keep expanding because the high price trend over the recent years encourage the farmers to invest. Indeed, Cassia cinnamon has become an important product to bring more income to Vietnamese farmers and workers, enriching many lives in rural areas of Vietnam.
Next article: https://cassia-cinnamon.com/cassia-cinnamon-update-2020