Adverse weather hurts tea output in SL
View(s):Prolonged heavy showers and strong gale force winds have drastically cut tea production in Sri Lanka with some estates recording only 40 per cent of its estimated average yield in the past two months, the Planters Association (PA) said.
According to Regional Plantation Companies (RPC’s) with crops declining, the coming months will be critical for the plantations with regard to the bottom-line.
The adverse weather conditions with rainfall being the highest in 47 years has severely impacted Cost of Production (COP) which has escalated to more than double, averaging around Rs 700 among some estates, particularly in the Nuwara Eliya regions. Severely affected are estates in and around Nuwara Eliya, Hatton, Dickoya, Agrapatna and Talawakelle areas from which some of the best upcountry teas are harvested. At present, crop yields are only 40 to 45 per cent of the average, thus sending alarm signals to producers, the PA said.
“Buyers must take note of this critical situation that is prevailing,” noted Senarath Pahathkumbura, General Manager, Elpitiya Plantations PLC and a veteran planter. “Present COP due to the bad wet weather is between Rs 700 and 730 per kilogram while Net Sale Averages (NSA) are around Rs 325 thus incurring a severe loss to the producers,” he explained.
Mr. Pahathkumbura said buyers should consider the situation and pay the producers a reasonable price per kilogram of tea. “A low yield means low productivity and therefore very high Cost of Production, irrespective of productivity parameters”.
The decline in crops is dealing a further blow to the tea and rubber industry which is burdened by the impact of the wage hike to workers on COP.
According to officials, some companies have recorded a loss of Rs 100 million in the last month, a trend that cannot be sustained if it continues and will be detrimental to the future of the industry.
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