Ceylon tea ‘in track’ picking up markets
With the current increase of Ceylon tea production, the tea market for Sri Lanka is open to expand, The Daily Morning Business learnt.
Speaking to The Daily Morning Business, Chairman of Sri Lanka Tea Board, Niraj de Mel said:
“When the Ceylon Tea is back on track our production increases and naturally the buyers will return to get our tea for a good price.” He stressed that Sri Lanka does not lose markets because production is declining; rather, it suffers from a shortage of tea when there is a high demand.
“The low tea production refers to what happened in the last year to the end of March this year,” de Mel explained. He added that it is a “misconception” that people are having, merely because Sri Lanka’s tea production is down and that Ceylon tea is losing markets.
“Even in the first three months of this year, up to March, February was a month where production was up. So, now production-wise we are recovering, but the markets certainly are not lost” he added.
De Mel further noted, “People find it difficult to understand when the production gets less, prices increase and it is simply a supply and demand reaction.” Therefore, the production is diminishing which subsequently results in the price of tea going up.
“When prices go up and when the purchasing power of those importing countries are not large enough to buy at those price levels, then they are forced to look to fill up the shortfall from other countries that can come up with our type of tea,” he explained.
Ceylon Tea, one of the major export incomes earning commodities for Sri Lanka.
According to the Central Bank of Sri Lanka (CBSL) report 2023, the export tea price is 2,040.25 rupees in 2023 quarterly which is 12.3% when compared to last year’s quarter which is 962.27 rupees. Meanwhile 18.6 million kg of tea exported in 2023 quarterly which is 12.3% when compared to last year which is 21.1 last year quarterly.