Generation of more value addition in cinnamon exports: a study based on southern Sri Lanka

Abstract

Sri Lanka is the largest supplier of quality cinnamon to the world spice market Though cinnamon plays a key role in the spice sector, the performance of the overall sector in Sri Lanka has not been up to the expectations over the past years. Sri Lanka ranks well below other countries in value-added cinnamon exports to the world market Other competitor countries make huge profits by adding value to cinnamon exported from Sri Lanka, while Sri Lanka is losing profit due to exporting mostly raw cinnamon. In this context, this research project is designed to explore the possibilities to generate more value addition through cinnamon exports based on a case study in southern Sri Lanka. The research methodology consists of situational analysis, focus group interviews, and an in-depth questionnaire survey. The survey was carried out to gather data from 130 sample respondents mainly covering the various actors and agents in the whole cinnamon supply chain in southern Sri Lanka. The findings of this study show that the main obstacles to generate more value addition in cinnamon exports are lack of proper policies, incentives and strategies in the areas of marketing, finance, quality, technology management and product innovation. The methodology used and the policies recommended can apply to other cinnamon exporting countries as well. The social and managerial implications of the findings and policies of this study may be important to many apex bodies and other players in the cinnamon supply chain.