Vietnam Star Anise & Extracts Market- Trend Analysis & Forecasts

Market/ Product Overview

Vietnam’s star anise market has expanded substantially, with national harvest areas estimated at roughly 50,000–60,000 hectares across northern provinces, and annual production that may reach 20–22 thousand tonnes in favorable years when trees are mature and weather conditions are normal. Annually, the country exports around 14-16 thousand tonnes and yielding export revenues of about USD 600–85 million, reflecting the commodity’s steady role in agricultural exports. Average realized export prices per ton have fluctuated between about US$ 5,500 and US$ 7,000 depending on quality, whole vs broken ratio, and seasonal supply, with price softness in some periods when volumes rose by double digits.

Domestic processing into essential oils, powders and broken forms is growing but remains a smaller share of total value: extract and essential oil volumes are still measured in the low thousands of tonnes equivalent, although their value per ton is several times that of raw spice. Overall, the market is structurally mature on the raw side while nascent but rapidly evolving on the extraction and high-value product side.

Significance of Vietnam in Global Anise & Extracts Supply Chain

Vietnam is one of the handful of major global suppliers and accounts for a substantial share of worldwide star anise export volumes, supplying roughly 40–55% of global trade in many years depending on harvests and competitor output. For many downstream processors and extractors globally, Vietnam serves as a primary source of raw input; in peak months one major buyer alone can take up to 70–75% of a month’s production, underscoring buyer concentration risk and the importance of Vietnam’s role in meeting short-term surges in global demand. Geographic concentration is notable, as a small number of provinces contribute a large majority of production and roughly 80–90% of export volumes may originate from two to three provinces, which increases vulnerability to localized climate or supply chain shocks. Despite these concentration risks, Vietnam’s combination of acreage, farmer experience, and increasingly available processing capacity gives it leverage in shaping both raw commodity pricing and the availability of broken star anise and mid-grade material used by extractors.

Vietnam Anise & Extracts Supply & Demand Trend

Supply in Vietnam is characterized by medium to large scale acreage coupled with seasonality: most producing regions yield two primary harvests per year and per-hectare fresh yields in producing zones commonly range from 2.0 to 2.5 tonnes before drying and processing losses are accounted for. After accounting for drying losses and grading that convert fresh harvests to dry exportable volumes, national exportable dry volumes are typically in the 15–18 thousand tonnes band for a normal year.

Demand dynamics show that export demand, particularly from large neighboring markets, tends to outstrip domestic processing capacity for premium extract grades; for example, buyers in a single importing country have purchased as much as 7–8 thousand tonnes in one year, representing more than 40% of Vietnam’s annual exportable output in that year. Extractors and oil producers within Vietnam currently consume a minority share of domestic production but are expanding: investment plans announced by several domestic extract firms target doubling essential oil output across the next five years, which could absorb an additional 1–3 thousand tonnes equivalent of raw material annually when fully implemented. Market tightness during lean months frequently elevates spot prices by 10–25%, whereas harvest months can depress prices by a similar percentage due to supply surges.

Vietnam Anise & Extracts Market Growth Factors

Vietnam Anise & Extracts Market Segmentation

Segmentation by product form reveals distinct volume and margin dynamics across whole star anise, broken star anise, powdered/grind forms, and essential oils/extracts; whole star anise typically commands the highest premium and accounted for a majority of export value even as broken and powdered forms represented **% of exported tonnage in recent years. Broken star anise, which often sells at a discount of 20–40% compared to whole berries, is an important feedstock for extractors and industrial buyers whereas whole berries are preferred in culinary and retail applications.

Essential oils and concentrated extracts, while much smaller by weight, generate disproportionate revenue: extract products currently represent perhaps **% of total sector volume but contribute **% of total export value because of high per-unit prices. Application segmentation shows that culinary and spice use remains the single largest tonnage end-market, absorbing well over **% of annual exports, while flavour & fragrance and pharmaceutical/nutraceutical segments are growing fastest in value terms and have exhibited year-over-year demand growth in the 10–12% range.

Quality segmentation is also notable: premium, high-oil-content grades with low residue and organic certification sell at premiums often exceeding 30–50% relative to standard grades, and organic or certified clean-label extract varieties are being prioritized by food, cosmetics and nutraceutical buyers seeking traceability. Distribution channels are bifurcated between bulk B2B exports, which dominate tonnage, and B2C or branded products that capture higher margins but remain a smaller share of overall volumes; B2B buyers account for **% of trade volumes today.

Vietnam Anise & Extracts Trade (Export & Import) Trend

Vietnam is predominantly an exporting nation for star anise, with exports in the most recent full year around 14-16 thousand tonnes and export values near US$ 60–85 million, positioning it among the world’s top suppliers. Trade flows are regionally concentrated: two major trading partners together absorb nearly 70–75% of exported tonnage in peak months, and that concentration has created strong bilateral flows that drive export planning and harvesting schedules. Tariff and non-tariff dynamics are significant; preferential trade frameworks and regional agreements can lower import duty burdens by several percentage points and make Vietnamese product price-competitive in neighboring markets.

Seasonal shipping patterns are observable with export spikes soon after the two annual harvest periods; these spikes can temporarily depress FOB prices by 10–20%. On the import side, Vietnam imports very little raw star anise but does occasionally import specialized extract intermediates, and any such imports account for less than 5% of domestic processing input needs. Phytosanitary compliance, pesticide residue limits, and food safety certifications are increasingly central to trade agreements; failure to meet such criteria has, in prior instances, led to a small percentage of shipments (commonly 1–3%) being held or returned, which reinforces the importance of traceability and quality protocols.

Influence of Vietnam in Global Anise & Extracts Price

Because Vietnam supplies a substantial portion of internationally traded star anise, its production cycles and export volumes materially influence global pricing trends. Average export prices from Vietnam in recent years have moved within a band of US$ 5,500 to USD 7,500 per tonne depending on grade and season, and when Vietnam’s exports increased by more than 20% in a single year, global average prices softened by roughly 5–10% due to higher available volumes. Conversely, months with steep production declines or logistical disruptions have seen spot prices rise by as much as 15–25%. The presence of significant broken-star anise volumes—often 30–40% of a harvest when grading and handling are imperfect—also serves to cap high-end price spikes because extractors and industrial buyers can switch to these lower-cost inputs. For higher-purity extract markets, input costs for raw star anise constitute a major portion of production cost, and therefore a 10% movement in raw commodity FOB price can translate into a 6–12% movement in finished extract prices, depending on extraction yield and process efficiency.

Market Competitive Landscape

Future Outlook

Projecting to 2032, the raw star anise export volumes from Vietnam are forecast to rise to 22–25 thousand tonnes annually under a base-case scenario that assumes modest area expansion, incremental yield improvements and stable weather patterns, representing a 5–7% CAGR from current baseline volumes. The extract and essential oil segment is expected to expand more rapidly in value terms, potentially growing at an 8–10% CAGR through 2032 as domestic extraction capacity scales and international buyers shift more of their sourcing to pre-processed, certified extracts. By 2032, extractors that achieve consistent yields and secure organic or other premium certifications could command price multiples of 2–5x relative to raw FOB values, enabling higher sector profitability for vertically integrated players. Risks that could temper this optimistic path include climate shocks that reduce national output by 10–30% in adverse years, failure to secure sufficient CAPEX for processing modernization, or regulatory tightening in major importing markets that raises compliance costs by several percentage points. If complementary investments in post-harvest infrastructure, grading, traceability and extraction technology are realized, Vietnam has the potential to shift from mainly a raw spice supplier to a dominant regional hub for value-added anise extracts by 2032.