Ceylon Cinnamon 'Lion' logo to go global:
Spice exports up by 27 percent
Pre-export stages under review:
Sri Lanka's spice industry is progressing well but it needs to invest
its profits back into the industry to achieve stable growth. We should
thank the spice producers for the forex revenues they bring in, said
Industry and Commerce Minister Rishad Bathiudeen.
The Minister said this while addressing the Spice Industry Advisory
Committee last week at the Export Development Board premises in Colombo.
SMED 2010 Chairman and FCCISL Immediate Past President Kosala
Wickramanayake handing over the publication of Key Personís
Forum collection of speeches 2010 to Central Bank of Sri Lanka
Governor Ajith Nivard Cabraal.
Minister Bathiudeen expressed satisfaction and thanked for the
increased forex brought in by the spice industry. "Our spice industry
needs to re-invest its profits, so that the industry can continue to
grow," he said. "The Divi Neguma programme of the government could be
used to increase our cinnamon production by getting the households to
grow cinnamon and various other spices which will in turn benefit these
families," he said.
The committee members also informed Minister Bathiudeen of various
promotional activities that the EDB and the spice industry has
undertaken in the past few years. The future promotional activities
include the launching of the Ceylon Cinnamon Lion logo locally in the
next two months by President Mahinda Rajapaksa and thereafter to be
launched internationally at the Anuga Trade Fair in Germany and IFT in
New Orleans, USA. This will be followed by registering the Ceylon
Cinnamon Lion logo in the main consumer markets.
"Sri Lanka can still sell an additional 10,000 tonnes of cinnamon
easily if we can produce it," the producers said. "We need to double our
capacity so that we will be able to meet this extra demand," Minister
According to the Export Development Board of the Industry and
Commerce Ministry, Sri Lanka's total spice exports value in 2010 stood
at US $ 165 million and 51 percent of it belonged to Ceylon Cinnamon (US
$ 84 million). Spice exports earnings increased by 27 percent in 2010 in
comparison to 2009 while cinnamon exports revenues too increased by 13.3
percent compared to 2009. Sri Lanka is noted for its traditional quality
(Ceylon) cinnamon having 85 percent of world market share for cinnamon.
Mexico is Sri Lanka's main cinnamon export destination followed by USA.
More than 85 percent of locally produced cinnamon are exported.
The committee members said that of the 30,000 hectares of cinnamon
grown in Sri Lanka, 20 percent are peeled twice a year and 70 percent
are peeled only once a year, thereby incurring potential forex losses.
"10 percent is peeled once in two years, if peeled at all," a member
said. According to them, Sri Lanka's cinnamon industry needs another
10,000 peelers due to worker shortage. Currently, a cinnamon peeler
earns between Rs 30,000 to 45,000 per month, with a mere three months
'on the job' training.
The Committee Members voiced that high labour costs are a serious
burden. Unlike in tea and rubber industries, there is a serious shortage
of cinnamon peelers in Sri Lanka leaving the existing peelers to charge
exorbitant amounts for peeling. Cinnamon peeling is skilled work and the
communities involved in it for generations have begun to demand income
sharing and no less. "We share a minimum of one-third (33 percent) of
our cinnamon sales revenue with the peelers on a daily basis and some
producers are compelled to share as much as 50 percent of their
revenues," said Sarada M de Silva, of Intercom Limited.
Minister Bathiudeen was also informed by the Committee that the Sri
Lankan spice volumes (including cinnamon) for export, despite their high
quality, are facing the risk of rejection in tough international market
segments such as North America, due to the lack of various essential
cleaning and sterilization process facilities at pre-export stages.
A committee member said that post-harvest drying of spices before
export is essential and if any moisture is left in the commodities, the
export shipment could be rejected and compelled to be incinerated at the
importers' end. In such a case the Sri Lankan exporters have to bear
additional charges for safe incineration of the entire shipment, a