Qual­ity stan­dards – Make or break point of Sri Lanka’s cin­na­mon industry


Cin­na­mon is the leading spice com­mod­ity of Sri Lanka. It con­trib­uted to ap­prox­i­mately 54 per­cent of to­tal spice ex­ports and ac­counted for 8 per­cent of to­tal agri­cul­ture ex­ports in terms of values, in 2017. Dur­ing the last decade, Sri Lanka has dom­i­nated the world mar­ket in cin­na­mon ex­ports, fol­lowed by In­done­sia, China and Viet­nam. How­ever, these coun­tries pro­duce cas­sia in huge quan­ti­ties, whereas Sri Lanka pro­duces pure cin­na­mon (Cin­namo­mumzey­lan­icum).

Even as the leader in the global mar­ket, meet­ing the qual­ity stan­dards is a ma­jor prob­lem faced by Sri Lanka’s cin­na­mon ex­porters. The 2019 bud­get pro­poses to make it manda­tory for cin­na­mon ex­porters to ob­tain the cer­ti­fi­ca­tion for their products af­ter qual­ity con­trol test­ing, at the point of ex­port. Those who fail the test will have 12 months to im­prove their op­er­a­tions and bring their products up to stan­dard. In this con­text, this ar­ti­cle fo­cuses on the ma­jor qual­ity con­straints faced by the cin­na­mon ex­porters in Sri Lanka and pro­vides rec­om­men­da­tions, based on a re­cent IPS study.

Although Sri Lanka re­mains a mar­ket leader in pure cin­na­mon, cap­tur­ing a mar­ket share of 90 per­cent, there are a few new­com­ers to the pure cin­na­mon industry, such as the Sey­chelles and Mada­gas­car. Thus, in the fu­ture, Sri Lanka will face stiff com­pe­ti­tion from these new entrants and as such, in­creas­ing the quan­tity and qual­ity of cin­na­mon is key to re­main­ing com­pet­i­tive in the global mar­ket.

Sri Lanka’s main ex­port mar­kets for cin­na­mon are Mex­ico, the USA and Peru, while a sig­nif­i­cant quan­tity is ex­ported to Colom­bia, Ecuador, Bo­livia and In­dia. More than 90 per­cent of cin­na­mon is ex­ported as cin­na­mon quills/sticks, whereas much less is ex­ported as cin­na­mon bark oil and leaf oil. Thus, main­tain­ing the qual­ity stan­dards of cin­na­mon quills is es­pe­cially nec­es­sary to sur­vive in the in­ter­na­tional mar­ket.

Prod­uct and process stan­dards rel­e­vant to cin­na­mon

The Sri Lanka Stan­dards In­sti­tute (SLSI) has spec­i­fied the re­quired stan­dards for Cey­lon Cin­na­mon (SLS 81: 2010); the fo­cus is mainly on the phys­i­cal ap­pear­ance of the products. Ac­cord­ing to the spec­i­fi­ca­tions, there are two main grades – ‘coarse’ and ‘fine’.

The fine grade is named as ‘Alba’ and the mar­ket price is sig­nif­i­cantly higher com­pared to other grades; the coarse grades are ‘Mex­i­can’ and ‘Ham­burg’. These are cat­e­gorised ac­cord­ing to the di­am­e­ter of quills, num­ber of whole quills per kilo­gramme and the oc­cur­rence of red­dish-brown patches on the sur­face of the quills (the ex­tent of fox­ing).

There are also in­ter­na­tional stan­dards that are ap­pli­ca­ble for cin­na­mon, such as the Euro­pean Spice As­so­ci­a­tion (ESA) spec­i­fi­ca­tions of qual­ity for herbs and spices, Amer­i­can Spice Trade As­so­ci­a­tion’s (ASTA) clean­li­ness spec­i­fi­ca­tions, Good Agri­cul­tural Prac­tices (GAPS), Hazard Anal­y­sis and Crit­i­cal Con­trol Points (HACCP), ISO 22000:2005 and Fair Trade.

Does Sri Lankan cin­na­mon meet qual­ity stan­dards?

There are sev­eral stake­hold­ers in­volved in the cin­na­mon value chain. Af­ter har­vest­ing cin­na­mon, peel­ers play a ma­jor role in prepar­ing cin­na­mon bales. Peel­ing requires skilled labour and the know-how handed down from gen­er­a­tion to gen­er­a­tion. Proper care and at­ten­tion are im­por­tant at this stage, to en­sure the qual­ity of the prod­uct.

Presently, most peel­ers lack knowl­edge and in­ter­est. Also, they are re­luc­tant to peel fine grades as it is time- con­sum­ing. Thus, they rush to fin­ish work at one lo­ca­tion and move on to an­other peel­ing shed within a short pe­riod of time. Labour short­age in peel­ing cre­ates a high de­mand for peel­ers.

More­over, peel­ing is done at house­hold premises in most cases, with lim­ited fa­cil­i­ties and technology for pro­duc­tion and stor­age. Fur­ther, they use prim­i­tive tech­niques and tools and do not ad­here to prac­tices that en­sure high qual­ity and safety.

Col­lec­tors’ main re­quire­ments when buy­ing cin­na­mon are the mois­ture con­tent and ap­pear­ance of cin­na­mon bales. The mois­ture con­tent is mea­sured by check­ing the sam­ples with their hands. Although the mois­ture me­ters are avail­able to check these lev­els, the col­lec­tors do not use them due to neg­li­gence.

The pro­duc­ers sell their cin­na­mon bales to any col­lec­tor who of­fers them the high­est price. The col­lec­tors have bar­gain­ing power to de­ter­mine the prices, ac­cord­ing to the grades. The qual­ity of cin­na­mon bales is de­ter­mined through the col­lec­tors’ ex­pe­ri­ences. In gen­eral, one cin­na­mon bale con­sists of dif­fer­ent grades of quills. Thus, de­cid­ing a price of a bale is en­tirely up to the col­lec­tor.

The col­lec­tors com­pete amongst each other. Such com­pe­ti­tion leads to the pur­chas­ing of low-qual­ity products at a very low rate, which are then mixed with oth­ers. They also ne­glect to pro­vide hy­gienic stor­age con­di­tions and proper trans­porta­tion. Most of­ten, col­lec­tors pre­fer to sell their cin­na­mon to ex­porters who of­fer them a fair price. They also re­quire quick pay­ment meth­ods and pre­fer to get paid in cash.

The ex­porters are mainly con­cerned with the clean­li­ness of cin­na­mon bales; they should be free from mi­cro­bial at­tacks. How­ever, find­ing qual­ity products is a ma­jor chal­lenge. This is mainly due to the weak link­ages among the pro­duc­ers and ex­porters. The col­lec­tors who act as mid­dle-men have con­trol over the sup­ply and they pro­vide bales, which are a mix of sev­eral grades. More­over, ob­tain­ing and main­tain­ing in­ter­na­tional qual­ity cer­tifi­cates are also very costly.

Way for­ward

It is cru­cial to con­duct aware­ness pro­grammes on the importance of meet­ing qual­ity stan­dards from pro­ducer level to ex­porter level across the cin­na­mon value chain. At pro­ducer level, it is vi­tal to in­tro­duce tech­niques and meth­ods to make the peel­ing, rolling and quilling pro­cesses eas­ier and pro­vide proper train­ing for peel­ers to pro­duce qual­ity products.

The press­ing need for es­tab­lish­ing ‘Cen­tral Pro­cess­ing Units’ in main grow­ing ar­eas has been em­pha­sised by the stake­hold­ers in the industry. More­over, it is use­ful to mod­ernise ‘in-house pro­cess­ing sheds’ to main­tain the qual­ity of the products.

It is also nec­es­sary to pro­mote pro­duc­ers to ad­here with GAPS. The 2019 bud­get has recog­nised the importance of strength­en­ing the cin­na­mon train­ing academy in Kos­goda to train peel­ers and the bud­get has al­lo­cated funds for it.

At the col­lec­tor level, a pri­or­ity would be to pro­mote sound stor­age and trans­port sys­tems. To­wards this end, aware­ness should be in­creased on con­di­tions of ware­houses, which should be cov­ered and well pro­tected from rain, the sun and ex­ces­sive heat. More­over, Sri Lanka has to strengthen the ex­ist­ing mech­a­nisms and in­tro­duce new technologi­es for qual­ity check­ing.

When con­sid­er­ing the ex­porter level, in­creas­ing their link­ages with the pro­duc­ers and de­vel­op­ing ap­pro­pri­ate meth­ods and pro­grammes for pro­cess­ing are re­quired. It is es­sen­tial to in­tro­duce con­ces­sion­ary terms or in­cen­tive schemes for the ex­porters who wish to ob­tain and main­tain stan­dard cer­tifi­cates, to safe­guard Sri Lanka’s po­si­tion as the sup­plier of true cin­na­mon to the world.

As high­lighted ear­lier, the 2019 bud­get has taken steps to­wards en­sur­ing the qual­ity of cin­na­mon ex­ports. How­ever, more needs to done along the cin­na­mon value chain to en­sure the qual­ity of cin­na­mon ex­ports. (Dilani Hirimuthug­odage, a Re­search Of­fi­cer at the In­sti­tute of Pol­icy Stud­ies of Sri Lanka (IPS), can be reached at [email protected] To view this ar­ti­cle on­line and to share your com­ments, visit the IPS blog ‘Talk­ing Eco­nom­ics’ - http:// www.ips.lk/talkinge­co­nomics/)

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