- Export volume decline led by decrease in packeted tea exports
- Tea broker says industry should remain cautiously optimistic
Sri Lanka’s tea export volumes declined by 10.4 percent year-on-year (YoY) to 23.1 million kgs in October, despite a 2.1 percent YoY improvement in tea production in the month, according to the Tea Exporters Association (TEA).
In October this year, Sri Lanka tea production reached 23.4 million kgs, compared to 21.2 million kgs in October, last year, driven by gains in High-Grown and Low-Grown teas.
However, tea exports fell by 2.7 million kgs in the month, mainly driven by a decrease in packeted tea exports.
According to the Export Development Board (EDB), October tea export earnings declined by 1.38 percent YoY to US $ 112.2 million.
However, export earnings in rupee terms stood at Rs.20.69 billion in the month, showing a marginal gain, compared to Rs.20.64 billion in October last year.
During the 10 months of the year, Sri Lanka’s cumulative tea export earnings declined by 9.42 percent YoY to Rs.1.013 billion.
However, Ceylon Tea has made notable gains in both auction prices as well as FOB prices during the 10-month period. During the period, Turkey has retained the top spot as the main buyer of Ceylon Tea, followed by Iraq and Russia, with Iran occupying the fourth position.
The TEA noted that although Iran has occupied the fourth position, a fairly substantial decrease in imports has been recorded during the 10 months of the year, compared to the corresponding period of 2019.
Among the top 10 buyers of Ceylon Tea, only tea exports to China and Chile have seen a significant increase during the 10-month period, while tea exports to Iraq and other Middle Eastern and Western Asian markets showed a notable decline during the month.
Ceylon Tea Brokers in its latest report noted that the tea industry could be cautiously optimistic on the recovery of the sector.
“Whilst the global trade is making a frail recovery and the outlook remaining uncertain, the Sri Lankan tea industry could be cautiously optimistic, depending on how the COVID-19 pandemic evolves in the future,” it said.