Delay in traceability system curbs Ceylon Cinnamon exports

• Industry claims not a single shipment was sent with GI certificate despite obtaining GI status in 2022
• Calls for urgent action to expedite implementation of traceability system to leverage GI certification to full potential 
• Claims situation has not only wasted time but also hindered opportunity for Sri Lanka to gain significant foreign exchange and market share for Ceylon Cinnamon globally
• Highlights abrupt shifts in policy direction, institutional responsibilities disrupt continuity and effectiveness of initiatives
• Cinnamon exports in 2023 declined to Rs. 70 b or around $ 230 million from a record Rs. 75 b in previos year despite exporting more volume 20 m kilos as against 18.5 m kilos in 2022

By Charumini de Silva

The prolonged delay in implementing a traceability system for Ceylon Cinnamon has emerged as a major obstacle, preventing the export of the spice with its Geographical Indication (GI) certification and costing the industry and the economy millions of dollars. 

Despite obtaining GI status from the European Union (EU) Commission in February 2022, which was intended to distinguish Ceylon Cinnamon in the EU market from lower-quality substitutes, not a single shipment has been sent with the GI certificate. 

“We are calling for urgent action to expedite the implementation of the traceability system and leverage the GI certification to its full potential, ensuring that Ceylon Cinnamon can achieve the market differentiation and premium pricing it deserves,” the industry stakeholders told the Daily FT.

A significant barrier to progress was the unavailability of a traceability system, which the Export Development Board (EDB) is currently addressing with financial support from the International Financial Corporation (IFC). 

“The delay in implementation has not only wasted time but also hindered the opportunity for Sri Lanka to gain significant foreign exchange and market share for Ceylon Cinnamon globally,” stakeholders explained. 

“Over 40 exporters, who have obtained the GI certificate after a rigorous procedure, have been unable to send any shipments with the certification due to this delay,” they claimed. 

The traceability system is essential for allowing end-users to verify the product’s origin and related information, which is crucial for maintaining the integrity and premium value of Ceylon Cinnamon.

The administration flaws have in some way or the other resulted in substantial financial losses for the exporters and foreign exchange earnings for a faster recovery of the economy. 

Another major obstacle they highlighted was the inconsistent Government policies and responsibilities of related institutions. “Abrupt shifts in policy direction and institutional responsibilities disrupt the continuity and effectiveness of initiatives. For instance, the abrupt transition of cinnamon responsibilities from the Department of Export Agriculture (DEA) to the Department of Cinnamon Development (DCD) and inadequate funds to implement policies have further compounded the issue,” they explained.

Cinnamon exports in 2023 declined to Rs. 70 billion (around $ 230 million) from a record Rs. 75 billion in the previous year. This was despite exporting more volume 20 million kilos as against 18.5 million kilos in 2022.

Industry stakeholders attribute a significant portion of this decline to the delay in implementing the GI traceability system for cinnamon. 

The industry urges the Government to address these issues promptly to leverage the GI certification fully and restore the growth trajectory of Ceylon Cinnamon exports.