WITHER EXPORTS IN THE NEXT FIVE YEARS Organized by EASL Spice - - PowerPoint PPT Presentation

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WITHER EXPORTS IN THE NEXT FIVE YEARS Organized by EASL Spice - - PowerPoint PPT Presentation

Jun 05, 2023 202 likes •468 views

Interactive forum on WITHER EXPORTS IN THE NEXT FIVE YEARS Organized by EASL Spice Sector FAZAL M USHIN Director Exports & Biz Dev. Link Natural Products (Pvt) Ltd Sri Lanka 1 E-mail : fazal@linknaturalproducts.com 2 Agricultural

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Interactive forum on

WITHER EXPORTS IN THE NEXT FIVE YEARS

Organized by EASL Spice Sector

FAZAL M USHIN Director – Exports & Biz Dev. Link Natural Products (Pvt) Ltd Sri Lanka E-mail : fazal@linknaturalproducts.com

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Agricultural sector - 2012

  • Total land under cultivation : 2, 645,000 ha (42.2%)
  • Agricultural contribution for total GDP : 9.27%
  • Spice crop production

: 74,104 ha / GDP 0.14% Cinnamon Pepper Clove Nutmeg & M ace Cardamom

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Land Extent 2005 (Ha) 2012 (Ha) % increase / Decrease Nutmeg 1,070 978

  • 9%

Clove 7,779 7,612

  • 2.1%

Black Pepper 29,156 31,667 9% Cinnamon 27,895 31,049 11% Cardamom 2,888 2,798

  • 3%

Comparison of production of 2005 vs 2012

Production 2005 (M T) 2012 (M T) % increase / Decrease Nutmeg 1,865 2,002 7% Clove 6,093 4,009

  • 34%

Black Pepper 14,265 18,604 30% Cinnamon 15,895 17,165 8% Cardamom 80 80 0%

Source : SAPPTA Annual Report

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Source : SAPPTA Annual Report

Growth of Production and export volume

Nutmeg Clove Black Pepper Cinnamon Cardamom

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Local Consumption - 2012

Commodity Consumption (M T) Nutmeg 327 Pepper 6,807 Clove 690 Cardamom 64 Cinnamon 5,211

Source : DEA

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Productivity in 2012 (Sri Lanka)

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Commodity kg/ Ha kg/ Ha Nutmeg 2,000 5,000 Clove 500 200 Black Pepper 600 1,700 - 2,550 Cinnamon 600 1,200 Cardamom 30 250

Source : SAPPTA Source : DEA Stats

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Average cost of production - 2012 Average Farm Gate Prices (Rs)

Commodity Cost of Production (Rs/ kg) Cost of Production vs farm gate prices (%) Nutmeg 249.07 236 Clove 368.61 214 Pepper 230.86 260 Cinnamon 692.9 50 Cardamom 985.0 97

Commodity 2005 2006 2007 2008 2009 2010 2011 2012 Nutmeg 244.88 235.36 278.12 316.23 331.87 459.62 742.53 838 Clove 347.94 480.53 471.97 471.97 484.66 542.99 1,250.35 1,160 Pepper 116.89 165.38 306.6 324.92 287.43 342.14 691.9 832 Cinnamon 395.48 431.09 599.62 664.35 621.95 726.57 921.9 1,042 Cardamom 744.15 716.92 913.25 1,718.27 1,732.32 3,320.96 2,713.12 1,946

Source : DEA Source : SAPPTA Annual Report

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Export performance

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Export Value 2005 (Rs bn) 2012 (Rs bn) % increase / Decrease Total 9.4 30.2 221%

Export Volume 2005 (M T) 2012 (M T) % increase / Decrease

Nutmeg 1,925 1,551

  • 19%

Clove 4,198 1,404

  • 67%

Black Pepper 7,821 10,825 38% Cinnamon 12,365 14,435 17% Cardamom 11 9

  • 18%

Source : SAPPTA Annual Report Ex Rate 100.49 Ex Rate 127.60 Note: rupee value has been depreciated by 27%

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Nutmeg

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Growth of Export Value

Clove Black Pepper

Cinnamon

Cardamom

Source : SAPPTA Annual Report

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Composition of main spice exports -2012

10 Source : Spice Sector report – CCC

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Global Production of Spices and Sri Lanka's Contribution - 2012

Commodity Production (M T) SL contribution % Pepper (Green, Light, Bold) White pepper Pepper light berries 342,590 3 Nutmeg BWP Nutmeg whole 15,000 13 Cinnamon 15,000 90 Cloves 120,000 3.34

Source : Spice Board of India/ IPC

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Growth of Export Volume

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Commodity 2009 (M T) 2010 (M T) 2011 (M T) 2012 (M T) Nutmeg Oil 23 13 22 25 Clove Oil 1.5 14 13 3 Black pepper Oil 0.05 5 8 12 Cinnamon Leaf Oil 107 155 231 318 Cinnamon Bark Oil 7 7 8 9 Cardamom Oil 0.3 1 0.8 Growth of Export Value 2009 (Rs M n) 2010 (Rs M n) 2011 (Rs M n) 2012 (Rs M n) Total 312.5 687.0 1,354 1,430 Growth Y/ Y % 120 % 97% 6%

Essential Oil

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Composition of main Essential Oil exports -2012

Source : SAPPTA annual report 12/13

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M ajor destinations of Essential oils

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  • USA
  • UK
  • France
  • India
  • Germany

M ajor destinations of Spices

  • India
  • Germany
  • M iddle East
  • North & South America
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Total Spice sector value

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Sector 2009 (Rs M n) 2010 (Rs M n) 2011 (Rs M n) 2012 (Rs M n) Spices 12,287 20,175 23,446 30,202 Essential oil 312.5 687.0 1,354.0 1,430.0 Total 12,599.5 20,862 24,800 31,632 Growth y/ y (%) 65 % 19% 27 %

* * The industry vision is to reach 100,000 M n by 2020

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  • Increase productivity
  • Lack of long term backward integration & collectivization
  • Lack of initiatives for moving up the value chain
  • M arketing
  • Legislative hurdles

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Challenges in the industry

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Challenges in the industry

  • Increase productivity

70% are small holder family farms 1 to 2 acers Acceptable post harvest practices – GM P/ Quality parameters Better agronomic practices

  • Lack of long term backward integration & collectivization

Establishing effective supply chain and linkages between all players in the industry Producers Collectors Exporters Processers

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  • Lack of initiatives for moving up the value chain

Focused R&D Cost of Technology inputs Product development

  • M arketing

High cost of establishing brands Private labeling Organic products

  • Legislative hurdles

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Challenges in the industry cnt..

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  • Increasing productivity
  • Product diversification - Identify emerging new products / markets
  • Develop a national strategy for whole / value added spices by public and

private sector stakeholders.

  • R & D and New Technology

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Strategy for Next 05 Years

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Strategy for Next 05 Years

  • Increasing productivity

Engage plantation companies to grow new crops and expanding the existing cultivation in spices. Introduce better agronomic practices to small holder farmers.

  • Product diversification & M arketing - Identify emerging new products / markets

M arket research Establishment of brands & financial support Private labeling contracts Ground Spices , Spice mixes, beverages Continuous support of participation in sectoral & brands (not the country wise)

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  • Develop a national strategy for whole / value added spices by public and private

sector stakeholders.

Private sector allow to take a lead role in developing a national policy - market driven M ake relevant government agencies such as EDB, DEA accountable to stake holders Ensure all CESS levied on spice is channeled back to the industry. Allow imports of raw materials for value addition without hindrance. Financial concessions & incentives to engage in agriculture & value addition, tax holidays, low interest long term loans for establishing of brands, development of organic spices, essential oils,

  • leoresins, extracts etc.,

Ensure maximum benefits to spice sector by negotiating existing or proposed FTAs

  • R & D and New Technology

Encourage to develop new products for Fractions , Isolates and CO2 (Organic/ Conventional) Active ingredients for Nutraceuticals , Cosmoceuticals, Pharmaceuticals industry

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Strategy for Next 05 Years cnt..

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Coleus Sandalwood Patchouli Turmeric Vetiver Davana Ginger

Potential new crops

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Value added products

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FAZAL M USHIN Director – E & BD Link Natural Products (Pvt) Ltd Sri Lanka E-mail : fazal@linknaturalproducts.com

THANK YOU

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