Updated Oct 23, 2022 14:03

Spice Market in Bangladesh

Market Overview
In , the Bangladeshi spice market decreased by -% to $ for the first time since 2013, thus ending a seven-year rising trend. In general, consumption continues to indicate moderate growth. Over the period under review, the market attained the maximum level at $ in , and then fell modestly in the following year.

In value terms, spice production reduced slightly to $ in estimated in export price. Over the period under review, the total production indicated a measured expansion from 2007 to : its value increased at an average annual rate of +% over the last fourteen-year period. The trend pattern, however, indicated some noticeable fluctuations being recorded throughout the analyzed period. Based on figures, production increased by +% against 2013 indices. The growth pace was the most rapid in 2016 with an increase of % against the previous year. Spice production peaked at $ in , and then fell in the following year.

The average yield of spices in Bangladesh contracted to tons per ha in , which is down by -% compared with figures. In general, the yield, however, continues to indicate a relatively flat trend pattern. The pace of growth appeared the most rapid in 2011 with an increase of %. The spice yield peaked at tons per ha in , and then reduced slightly in the following year. Despite the increased use of modern agricultural techniques and methods, future yield figures may still be impacted by adverse weather conditions.

In , the total area harvested in terms of spices production in Bangladesh expanded modestly to ha, picking up by % against . The harvested area increased at an average annual rate of +% from 2007 to ; the trend pattern remained consistent, with only minor fluctuations being recorded throughout the analyzed period. The most prominent rate of growth was recorded in 2011 with an increase of % against the previous year. Over the period under review, the harvested area dedicated to spice production reached the peak figure in and is likely to see gradual growth in the near future.


Consumption
For the sixth year in a row, Bangladesh recorded growth in consumption of spices, which increased by % to tons in . Over the period under review, the total consumption indicated a notable increase from 2007 to : its volume increased at an average annual rate of +% over the last fifteen years. The trend pattern, however, indicated some noticeable fluctuations being recorded throughout the analyzed period. Based on figures, consumption increased by +% against 2013 indices. Spice consumption peaked in and is expected to retain growth in years to come.

The size of the spice market in Bangladesh was estimated at $ in , remaining relatively unchanged against the previous year. This figure reflects the total revenues of producers and importers (excluding logistics costs, retail marketing costs, and retailers' margins, which will be included in the final consumer price). Overall, consumption posted noticeable growth. Spice consumption peaked in and is expected to retain growth in years to come.


Consumption by Type
Ginger ( tons), spices except pepper or ginger ( tons) and pimenta pepper ( tons) were the main products of spice consumption in Bangladesh, with a combined % share of the total volume.

From 2007 to , the most notable rate of growth in terms of consumption, amongst the main consumed products, was attained by ginger (with a CAGR of +%), while consumption for the other products experienced more modest paces of growth.

In value terms, pimenta pepper ($), spices except pepper or ginger ($) and ginger ($) appeared to be the products with the highest levels of market value in , together comprising % of the total market. These products were followed by anise, badian, fennel and coriander, nutmeg, mace and cardamoms, cinnamon (canella), cloves, piper pepper and vanilla, which together accounted for a further %.

Among the main consumed products, nutmeg, mace and cardamoms, with a CAGR of +%, recorded the highest rates of growth with regard to market size over the period under review, while market for the other products experienced more modest paces of growth.


Market Forecast
Driven by increasing demand for spice in Bangladesh, the market is expected to continue an upward consumption trend over the next eight-year period. Market performance is forecast to decelerate, expanding with an anticipated CAGR of +% for the period from to , which is projected to bring the market volume to tons by the end of .

In value terms, the market is forecast to increase with an anticipated CAGR of +% for the period from to , which is projected to bring the market value to $ (in nominal prices) by the end of .


Market Structure
In , the share of imports in total consumption accounted for % in value terms and % in physical terms. The share of imports decreased moderately (- percentage point) over the period under review.


Trade Balance
Bangladesh remains a net importer of spice; in physical and value terms, imports consistently exceeded exports from 2007 to . In , there was a significant trade deficit of tons, which was equal to $. This tangible trade deficit reflects the fact that the market remains dependent on imports, which is likely to continue in the medium term.