Source: Based on FAO Data.
Source: Based on FAO Data.
The global demand for cinnamon is expected to be around 102,616 t by 2004—05 (Table 12.21).
The opposite considerations apply to supply. Here, Indonesia holds the key. Its ability to regulate supply of cassia is likely to dictate the price internationally. Indonesia's management of this issue may be influenced by the proximity of the energetic entrepot Singapore. New exporters of cassia must also be conscious of China and now Vietnam and the speed at which they are expanding production level. Total world production of cinnamon is growing at the rate of 5.6% per annum, which is more than the world population growth rate. Thus, the anticipated supply in the form of increased production is expected to be a positive one. The fitted equation based on the selected model is:
Accordingly the projected world supply in the form of production increase up to 2004—05 will be as shown in the Table 12.21. The expected supply (production) by the year 2005—06 will be around 148,890 t. As can be seen from the fitted equation, where a is nearer to one, recent developments have more impact on the future supply.
As concluded by Vinning (1990) the combination of the above two calculations of supply and demand suggest that within the overall pessimistic outlook the prospects for cassia is better than for cinnamon in the years to come.
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