Huge growth in tea industry

Ramani KANGARAARACHCHI

* On course to achieve target of 305 million kilos in 2007

* Rs.8 billion rise in export earnings

* Russia, UAE, Iran among leading buyers

COLOMBO: Sri Lanka’s tea industry has shown a significant improvement compared to last year according to recent statistics on tea production, export and marketing, Sri Lanka Tea Board Chairman Lalith Hettiarachchi said.

A kilo of tea received an average US$ 2.60 except for one or two weeks, Hettiarachchi said.

The farmer also received an amount closer to the same for green leaves based on the average price at the export market.

“The depression in the production which started with 20 per cent due to adverse weather and strikes has now come down to nine per cent,” Hettiarachchi said.

The Chairman was hopeful of reaching the 305 million kg target compared to the last year’s 310 million kg. He expressed displeasure over what he called an “unethical” wage increase on the cards, after nine months of previous negotiations which is valid for two years.

The total tea production for July 2007 was 26.2 Million kg a rise of 2.5 Mkg or 10.3 per cent when compared with the 23.7 MKg produced during the corresponding month in 2006. This rise in tea production is recorded in all three elevations.

The rise in monthly production was recorded in both Black and Green tea sectors. Black tea showed an increase of 10.1 per cent against the preceding year and Green tea production was up by a sizable 32.1 per cent. However, the cumulative figures could not surpass last year’s crop.

The share of CTC component in total black tea production up to July 2007 was 6.2 per cent which is slightly less than the 6.3 per cent achieved in 2006.

Meanwhile, the monthly Bio/Organic tea production of 72.9 MT in July 2007 recorded an increase of 56.3 percent with respect to the monthly production of 46.6 MT in 2006.

The cumulative Bio tea production of 738.2 MT recorded a 21.1 per cent increase as against the manufacture of 609.7 MT in 2006.

During the period under review, both monthly and cumulative instant tea production recorded 184.4 MT and 1,029.4 MT in year 2006. Referring to tea exports in July 2007, Hettiarachchi said it was moderately higher than that of the same month in 2006.

The monthly total tea exports in 2007 exceeded the 2006 figure by 6.8 per cent, which could be attributed mainly due to the upward variation in exports of tea packets, he said.

Cumulative export volumes of bulk tea, tea packets and green tea was still behind the corresponding records last year. The total exports in all categories in 2007 was 29,319,770 kgs compared to 27,442,562 kgs in 2006 which is an increase of 6.8 percent amounting to 1,877,208 kgs.

However all types of monthly exports other than instant tea reported growth in their unit prices, which resulted the FOB price in July 2007 to increase by Rs 82.62 or 30.9 percent against the price in 2006.

This led to an increase in the cumulative export earnings of Rs 58.4 billion in 2007 compared to Rs 50.9 billion in the previous year. However the growth of FOB in 2007 recorded an increase of 23.0 percent compared with the price in 2006.

The main 10 destinations of Sri Lankan teas led by Russia included UAE, Iran, Syria, Turkey, Japan, Iraq, Saudi Arabia, Libya and Ukraine with a 17.3 per cent of exports share during the period under review, but showed sa decline of 3.8 MKg in total tea imports from Sri Lanka.

A significant increase in exports of value added products was recorded - teabags 37 per cent, packets 19 per cent, instant 78 percent, Green 14 per cent and other teas 20 per cent.

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