Nov 09, 2016 (LBO) – Sri Lanka’s cabinet nod has been received to list Cinnamon as a banned commodity to import from other parts of the world.
The move came after few incidents that Cinnamon produced in other countries re-exported to several countries under the Entrepot trade.
Ministry of Primary Industries said as per the Customs records 4 Cinnamon containers were imported and re-exported to Madagascar under the Entreport trade in 2016.
The cabinet is of the view that this will badly affect the Ceylon Cinnamon trade and will affect Sri Lanka’s premier market share in global markets.
It is also suspected that the spices re-exported through Sri Lanka are re-packed indicating as the spices of Sri Lanka origin.
Since the re-export process is not transparent enough, it could harm the recognition of Sri Lankan spice industry.
Export earnings from Cinnamon is stagnated around 132 million US dollars in recent years though it is the most valuable spice produced in Sri Lanka.
More than 200,000 stakeholders are in the industry with average annual production is 18,000 metric tons while about 15,000 metric tons is exported.
US and Mexico are the main markets for Ceylon Cinnamon with Cinnamon exports from Sri Lanka to Mexico is around 44 percent from total Cinnamon exports while US with 13 percent.
The cabinet has also decided to appoint a committee to amend the current operational mechanisms and Entrepot schemes to protect the spice and allied products industry.
It has also been decided to establish bonded processing facilities for all re-export of spices through Sri Lankan ports by the Ministry of Primary Industries.
Sri Lanka expects to reach the target of 1 billion US dollars from spice sector in 2020.