Tea makers want moratorium on leases
Hard on the heels of the hospitality industry, now tea estate owners want the government to grant a moratorium on their lease rentals to ease their burden as tea prices continue to decline since the first half of this year.
Hayleys Plantations Managing Director Roshan Rajadurai told the Business Times said that they would not ask the government for any hand-outs but considering the situation if the state wanted to intervene to assist in the resolution of the crisis then they could agree to a moratorium on the lease rentals of the Regional Plantation Companies (RPCs).
He pointed out that if factory owners could be given a moratorium on their leases then the government could consider giving them a moratorium on their lease rentals just until they overcome the current crisis. A decline in the tea prices globally has created a big impact on the local tea manufacturers who are compelled to sell the beverage at a price that does not cover their costs.
Mr. Rajadurai explained that prices have been down and the crop has dropped as the cropping month had come in late. However, very recently the industry faced the largest yield in years.
Commenting on the situation, he noted that the teas were sold at Rs.471 from the previous Rs.600 while labour cost had gone up as well.
In this backdrop they were unable to make ends meet and almost all estates were carrying out a revenue share model with their workers.
In this respect, Mr. Rajadurai said that they want the trade unions to now come to an agreement on the new wage structure of the workers to ensure they engage in a new model.
Meanwhile, tensions developing between the US and Iran have not helped the industry that is trying to overcome the current situation by establishing a market based mechanism.
In the meantime, Factory Owners Association President Harith Ranasinghe said that since their meeting with Prime Minister Ranil Wickramasinghe, Plantations Minister Navin Dissanayaka has organised a meeting with the factory owners that will be carried out in batches to ensure all their grievances are heard. Bank representatives will also be part of this meeting.