Global Industry Overview

The global spice and culinary herb industry comprises of many plants having diverse end uses including culinary, medicinal etc. The industry also consists of spice derivatives like essential oils, oleoresin, spice oils etc. According to international trade estimates about 85% of spices and culinary herbs are traded in dried form. These spices are cleaned and used in a crude form without any further processing. The world production and processing centres of spices and culinary herbs remain concentrated in Europe and in a number of Asian countries. Canada is fast emerging as one of the leading players in the international spice and herb industry. There are certain countries acting as leading producers and traders of some particular spices and culinary herbs. For example, India is popularly known for being a source of cloves, Indonesia has supplied the global market with cinnamon and nutmeg and China has been the leading provider of ginger. Key Industry Trends

There has been a substantial increase in use of fresh herbs and spices owing to an increased demand in the hotel industry. Change of consumers towards leading a healthy lifestyle has increased the use of herbs / natural spices for natural flavoring. Use of spice derivatives like essential oils are being widely used internationally in food and beverage industries for flavoring and fragrances. The global demand of spices has increased due to: o Increase in demand and consumption of ethnic food. o Introduction of flavored coffee, tea and aerated drinks in the beverage industry. o A sharp growth in the processed food consumption. o Increase in the demand for natural fragrances for various health therapies.

Application of Spices and Derivatives

Food Flavoring Food Preservation Personal Hygiene Products Aromatherapy Feeds Pharmaceuticals Industrial Chemicals Beverages

Indian Industry Overview

India has traditionally been known for its spice and culinary herb production. It is one of the largest spice producing and consuming country. Its strategic location, climatic conditions, advanced production processes and availability of cheap labour makes it advantageous for the producers to ensure large scale production of quality spices and herbs. India's Share in the Global Spice Market The Indian spice industry is booming with a substantial increase in exports over the past few years. India accounts for nearly 45% and 30% in terms of volume and value in the world spice trade. The booming global spice market also poses good opportunities for the Indian spice industry to provide quality spices at competitive prices. India faces stiff competition form China, Malaysia and Pakistan in terms of pricing of the products. Manufacturers should therefore ensure consistency in supply, product quality, pricing and marketing strategy to increase the share in exports. Producers are incorporating latest methods and technologies to ensure higher quality of spices and herbs. India is one of the prime exporters of pepper, chillies, turmeric, seed spices and spice derivatives to the rest of the world. USA, EU, Japan and Srilanka import these Indian spices in large volumes. India's share in Global Spice Derivative Market Spice derivatives can be categorized into spice oil, oleoresins and essential oils. The demand for spice derivatives is also increasing due to the hygiene, standardization and consistency factor. India contributes nearly 70% to the world spice derivative market. It exports largely to the US, EU etc. Indian southern states including Kerala, Karnataka and Tamil Nadu provide concentrated oils and oleoresins for use in perfumery, pharmaceuticals, foods processing and industrial chemical industry. Government Initiative Indian Government is providing financial assistance to farmers, growers and spice producers and has also taken certain steps to ensure the availability of better quality spices, more hygienically processed spices in order to boost exports. Indian spice board also provides financial and technical assistance to farmers.

Spice Industry Overview

Spice industry has been witnessing phenomenal growth rates both in the international and domestic sector. The growth in this sector can be attributed to the change in the lifestyle patterns of the consumers all over the world. The shift in the consumption trend toward natural products has also contributed to the increased global demand of spices and culinary herbs. Spice and derivatives market is booming because these products find applications in a number of industries including pharmaceutical, medicine, beverages, food processing, personal hygiene products to name a few. Developing countries especially in the Asian continent are the major producers of variety of spices. A large percentage of international and domestic trade takes place in the dried form. India, Indonesia, China are few of the prime producers of a variety of high quality spices and also significant contributors to the global spice trade. The culinary herb market is also expanding though the production areas are widely distributed. India is one of the prime producers and suppliers of raw herbs to USA and the EU. This is a labour intensive industry, therefore producers must have a sound knowledge of the methods and processes involved in the production of herbs and spices.

Indian Spices Market

India is famous for its spices that are widely used in industries like pharmaceutical, neutraceuticals, perfumery, toiletry and cosmetics. Indian spices are one of the major suppliers of pepper to a large number of countries. Growth in Spices Market The Indian spice market has shown remarkable growth in spice and culinary herbs exports. Indian spices manufacturers are making substantial efforts to improve the quality of spices backed up by technological advancement in order to tap the international market. Advanced technologies such as carbon dioxide extraction, cryogrinding, encapsulation of spice oil is being undertaken to ensure high quality of spices and their derivatives. Market for Spice oils and Oleoresins India is also leading in the field of spice derivatives, meeting almost 70% of the total demand of spice oils and oleoresins. The country is providing value added products and thus achieved a repute in the international community. With a focus on strong R&D, the Indian Manufacturers are are developing new products, implementing organic method of production for providing organic spices and herbs, which command a 10-30% premium. Spice Export Figures India is one of the major Asian production and trading centre of spices, its derivatives and also culinary herbs. India's spice exports account for about 39% of the total exports in terms of volume and around 22% in terms of exports value. India meets almost 65% of the global demand for derivatives like spice oils and oleoresins.

Major Spices Market Exported Chillies Seed spices Turmeric Spice Oils and oleoresins Pepper Cardamom Ginger Fennel Fenugreek Tamarind Nutmeg and Mace 33% 22% 14% 7% 7% 1.1% 2.7% 1.1% 1.2% 0.9% 1.0%

Spice Production Areas

The spice production areas or centres, its derivatives and culinary herbs are concentrated in the moderate and semi-tropical regions of the world. These places are suited for a particular spice or herb due to their climatic conditions and other factors including low wage rates, sound infrastructure etc. The production areas of spices and herbs can be categorized as following: Global Spice Production Areas/Centres The production of spices and herbs has been traditionally concentrated in countries including Israel, Egypt, India for processing and exporting the commodity. Now the spice manufacturing areas are also expanding to lesser traditional countries including Europe, particularly France. Other major spice manufacturinging areas include Bulgaria, Germany, Hungary etc. China, Malaysia, India, Korea are one of the leading spice producing zones in the Asian Continent. India along with Israel and a few European countries is the significant producer of culinary herbs. The climatic conditions together with highly skilled but cheap labour force makes them ideal for large scale production. Indian Spice Production Areas/Centres The production of spices and herbs is widely distributed in a number of Indian states. Southern states of Karnataka, Kerala, and Tamilnadu are one of the major areas producing quite a few spices, states of Rajasthan and Uttar Pradesh are also apt for growing spices like Garlic, Mustard, Fennel, Turmeric etc.