Impending plantation worker wage hike threatens industry viability- Kelany Valley Chairman

5 March 2013 04:55 am - 1 - {{hitsCtrl.values.hits}}

A A A

The impending wage negotiations for plantation sector workers which are expected by mid-2013, coupled with recently imposed cess on exports of bulk tea, which led to much controversy, are expected to have a negative impact on the tea sector, which managed to show a slight improvement in 2012, according to a head of a leading plantation company.

“Any prognosis on the viability of the local industry (tea), at least in the short term also needs to take into consideration the impending worker wage increase which will impact on production costs, particularly in the absence of a direct link to productivity,” said Kelani Valley Plantations PLC (KVPL) Chairman Mohan Pandithage.

Further, Pandithage raised concerns of the recently imposed cess on exports of bulk tea, which according to him, in due course is bound to affect the producer with the buyers discounting auction prices proportionately unless exporters respond to the challenge posed by the cess, by making a concerted effort to minimize bulk tea exports and supplementing the deficiency with value-added tea.

“However,” he noted, “this is an improbable expectation in the short to medium term.”

On February 21, Mirror Business quoting plantation sector stakeholders forewarned of the possible repercussions of the impending wage hike in the plantation sector as the two-year collective agreement struck between the regional plantation companies (RPCs) and estate sector labour unions back in 2011 is expiring on March 31 this year.

Speaking on the matter, Planters’ Association Chairman Lalith Obeysekara said, “We (RPCs) are not in a position to grant another increase in wages at this juncture.”

The 2011 collective agreement which resulted in a 20.7 wage increase dented bottom lines of plantation sector companies as wage comprised of at least 60 percent of the total cost and thus analysts warned of similar ramifications of a similar move.

Speaking further on possible challenges Pandithage said, “The continuing turbulence in the European Union economies and the political volatility, following the populist uprisings in countries in the Middle Eastern belt will affect all commodity prices adversely.”

The country’s tea production almost remained flat last year with 326 million kilograms with average auction price increasing to Rs.391.64 assisted by the rupee depreciation. Tea, still amongst the top five foreign income earners saw its earnings declined by 5.3 percent to US$ 1,412 million in 2012.

See Kapruka's top selling online shopping categories such as Toys, Grocery, Flowers, Birthday Cakes, Fruits, Chocolates, Clothing and Electronics. Also see Kapruka's unique online services such as Money Remittence,News, Courier/Delivery, Food Delivery and over 700 top brands. Also get products from Amazon & Ebay via Kapruka Gloabal Shop into Sri Lanka.

Comments - 1

Hassan Tuesday, 22 July 2014 10:52 AM

What Kinds Of Vegetables Can I Grow In A Hydroponic Grow Closet.

Once done, get back to Craven, retrieve your lens and get back
to camp. An informed purchase starts with reading product specifications and how they may relate to
these very different types of gardening.

Add comment
Comments will be edited (grammar, spelling and slang) and authorized at the discretion of Daily Mirror online. The website also has the right not to publish selected comments.

Impending plantation worker wage hike threatens industry viability- Kelany Valley Chairman

Comments - 1

Add comment

RECOMMENDED

Acquittal of TMVP Leader “Pillayan” From Murder Charges

Military Training for Youth, Explained

Illegal clearing of Attidiya Sanctuary with powerful political patronage

Bio Bubble Bursts on tissa safari drivers

Army’s LRRP Ambush of LTTE’s Military Intelligence Chief

“I don’t think Sri Lankans can be realistically ruled by force” -Ahimsa Wickrematunge

Decisions to be made in Sri Lanka’s hunt for the COVID-19 Vaccine

Most Viewed in News

Southeast Asia’s largest tyre plant

SL human rights situation seriously deteriorated under Gotabaya’s Govt.: Report shows

Over 50 hotels out of bounds for locals

PHIs warn of critical time in coming weeks in terms of Covid-19

Health Minister tests positive for COVID-19

Park & Ride...

TODAY'S HEADLINES

UNP new office bearers after assuming duties at Sirikotha

Veteran journalist Dr. Edwin Ariyadasa passes away

SJB will appoint new office bearers for 2021 on January 25 - Nalin Bandara

British High Commissioner joins Environment Ministry to implement project

MIRROR CRICKET

Anderson six-for keeps Sri Lanka in check

Mathews ton lifts Sri Lanka to 229-4 on day one of second England Test

England look to sweep Sri Lanka as India await

Clinical England go 1-0 up

Not the end of the world for Ramesh Mendis, says Hashan Tillakaratne

Cricket is my second religion, says Sri Lankan fan Sunil Govinna

Mathews ton lifts Sri Lanka to 229-4

Chandimal calls for clinical execution in second Test against England