Tea production in Sri Lanka in 2010 is expected to reach an all time record exceeding 320 million kilos, according to Hasitha de Alwis, Director – Promotion, Sri Lanka Tea Board. The annual crop figures for 2010 have not been announced as yet.
In a statement he said the previously recorded highest tea production was 318 million kgs in 2008. The low grown production, the major contributor would account for 59% while the high grown annual crop will constitute 24% and the medium grown, the balance 17%.
Here is the rest of his statement on tea prices, exports and other developments:
Exports
The total exports inclusive of imported teas for blending, value addition and re-export is estimated in 2010 to again reach a significant figure of around 310 million kgs. The highest ever tea export volume in the past had been registered at 315 million kgs in 2006.
Tea prices
In 2009, the Colombo Tea Auction prices reached an all time high of Rs. 360 per kg. which was emulated in 2010 with a historic record of Rs.370 per kilo. The performance is so much more significant due to the fact that Sri Lanka Rupee appreciated against the US Dollar by 3% in 2010. In comparison to other international Tea Auction Centres such as Calcutta & Cochin in India, Mombasa in Kenya, Chittagon in Bangladesh or Limbe in Malawi, the Ceylon tea prices were fetching almost US$ 0.50 per kilo higher.
Revenue
The revenue generated from tea exports in Sri Lanka during 2010 is bound to reach a new record and come within reach of $1.5 billion mark. The highest ever record in the past has been $1.3 billion in 2008 which was maintained in 2009 as well despite a drop in production and exports.
Value addition
The Sri Lanka tea industry continued to lead the global pack as the largest exporter of value added teas within tea producing countries. The tea bag component of exports reached a historic record of 10% of total exports while the packeted tea component reach another record of more than 50% of total exports. The total value added component has surpassed 60% of the aggregate exports for the first time ever.
Major markets
The Russian Federation continued to be the largest market for Ceylon tea and the CIS region as a whole absorbed almost 25% of total exports while the Middle East/Gulf countries accounted for another 50%. The top 10 destinations which include Russia, Syria, Iran, UAE, Jordan, Turkey, Iraq, Japan, Libya and Kuwait absorb around 80% of total tea exports from Sri Lanka. New target markets for 2011: China and USA.
Challenges for the tea industry
* Increasing productivity and reducing cost by re-planting, in-filling and new planting.
* Factory modernization and obtaining international certifications for plants/units which are yet to receive such accolades.
* Sustain share in captive markets, arrest share in declining markets and penetrate new markets.
* Further upgrading of packaging plants of tea exporters, blenders and packers with new state of the art packaging machinery.
* Enhance cleaning facilities of tea units to produce a final product which is clean as ever.
* Retain required labour in the tea fields, particularly pluckers.
* The trade union wage negotiations to be more and more linked to productivity.
New developments
The Ceylon tea geographical indication has been registered and the seven agro-climatic regions of Nuwara Eliya, Uva, Dimbula, Uda Pussellawa, Kandy, Ruhuna, Sabaragamuwa have been gazetted and will receive GI Registrations in March 2011. Affirmatively, the industry will commence global registration of these unique GIs to protect Ceylon tea and the regions from counterfeiting. As a result, the Ceylon Tea name will add further value to fetch even higher prices.
The Ceylon Tea Ozone friendly logo which denotes that the Sri Lanka tea industry is the first ever tea producing country to be environmentally friendly to the extent of protecting the Ozone layer and discourage global warming has received the local registration in 2010. Accordingly, the Ozone friendly Ceylon tea logo would be promoted worldwide commencing from 2011 to give a huge boost for Ceylon tea.
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