Heavy rains likely to cut crisis-hit Sri Lanka’s tea production, exports

ECONOMYNEXT – Sri Lanka tea industry is expecting a 30 percent production dip this year due to heavy rains in October the country’s tea production area and the export earnings also are likely to reduce, tea brokers said.
The island nation’s tea production is already down in the first nine months of 2022 to 192.37 million kilograms, the lowest in 26 years in the corresponding period, according to the Ceylon Tea Board. The production in the Jan-Sept period is is 18 percent lower than last year.
Industry experts predict that tea production to have dropped by 30% as bad weather aggravated the already existing issues.
“Right now the tea production is down because the fresh leaves don’t flush out when there’s too much rain. So, naturally right now until the rain subsides there will be fewer leaves available for plucking,” Niraj De Mel, Chairman of Sri Lanka Tea told Economy Next last week.
“However the drop of output for the first nine months is a result of so many factors that took place in the last three years.”
Tea is Sri Lanka’s top exports crop which earned $937.1 million foreign exchange revenue in the first nine months of this year and that was 5 percent less than last year.
The export revenue did not fall as much as the production due to better prices for local tea in the global markets. However, analysts say there could be a drop in tea exports if the heavy rains continue throughout this year in the tea production area.
Some tea brokers see the tea production to fall as much as 30 percent by end October this year compared to the same period in 2021.
“By October, we expect a 30% drop in crop. It’s not only because of the weather, but also fertilizer as well,” Zameel Mohammed, the Executive Director at Ceylon Tea Brokers PLC.
But the Tea Board is hopeful the local tea production to flush out “like thunder”, when the rain subsides. However, the North-East Monsoonal rains, which yields the largest amount of rains to the country, are expected later this month.
Heavy rains retards crop growth, limits the movement of leaf collecting trucks, results in poor worker turnout, restricting productivity in factories that have been already hindered by continual power outages..
De Mel said last year’s tea production was helped by optimum rains despite a fertilizer ban.
“In the grand scheme of things I don’t think we can catch up on loss so far and this year will go down as one of the low-cropping years,” De Mel said.
“Hopefully 2023 should look up because of the rain and the fertilizer that is finally getting into plants.” (Colombo/Nov09/2022)