Vietnam’s Star Anise Exports See Modest Growth in May

According to the Vietnam Pepper Association (VPA), Vietnam exported 1,560 tons of star anise in May, generating approximately USD 7.2 million. This marked a 5.4% increase compared to April. India remained the largest importer, purchasing 951 tons, which accounted for 61% of Vietnam’s total star anise exports for the month.

Export Trends for the First Five Months of 2024

From January to May, Vietnam exported 5,475 tons of star anise, generating USD 27.5 million in revenue. However, this represented a 14.7% drop in volume and a 29.9% decline in value compared to the same period last year.

India continues to be Vietnam’s largest export market, importing 3,360 tons of star anise during this period. The United States followed with 399 tons, while Bangladesh imported 140 tons.

India’s Demand for Star Anise and Cinnamon

India is the world’s leading consumer of star anise and cinnamon, driven by its use in traditional medicine, culinary applications, and religious rituals. Despite being a major producer of medicinal herbs, India relies heavily on imports, and Vietnam dominates this market. Currently, Vietnam supplies over 80% of India’s cinnamon and star anise imports.

Vietnamese cinnamon is highly sought after in India due to its strong essential oil content and unique aroma. Additionally, exports benefit from preferential tariffs under the ASEAN-India Free Trade Agreement (FTA), making Vietnamese star anise more competitive in the Indian market.

Vietnam’s Competitive Edge in the Global Spice Market

Vietnam and China are the only two countries capable of producing star anise on a large scale, thanks to favorable climatic conditions. Vietnam’s star anise cultivation spans around 40,000 hectares, primarily in Lang Son and Cao Bang provinces, yielding over 16,000 tons annually.

Vietnam is a global leader in spice exports, ranking:

• First in cinnamon exports
• First in pepper production and export
• Second in star anise exports

Vietnamese spices are widely exported to key markets such as the United States, the European Union, China, India, and the Middle East. With global demand for natural spices on the rise, Vietnam’s dominant position in this industry is expected to strengthen further.

Conclusion:

Given the recent decline in export volume and value, buyers should monitor pricing trends closely. The price drop suggests a potential buying opportunity, especially for importers looking to secure quality star anise at competitive rates. However, traders should keep an eye on demand fluctuations and exchange rates, which could impact future pricing.

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