‘Tea crisis’: Where have we gone wrong?

8 May 2015 03:02 am - 1 - {{hitsCtrl.values.hits}}

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.The tea industry in Sri Lanka is in a serious conundrum. The management companies believe that the cost of wages is too high and that they cannot be further increased without losing financial sustainability. Unions state that the workers’ wage received is hardly able to get them up to the poverty line, even when both husband and wife of a household are employed.

Many experts and so-called gurus from the tea industry directly or indirectly involved time to time come up with the common tune of productivity increase. They maintain the main criterion for the sustainability of the tea industry is productivity increases.
Productivity is defined as the ratio between output and input. Another word for productivity is efficiency. Many people believe that productivity is simply a more sophisticated word for production. The lower productivity of our tea lands is no doubt a fundamental problem, which requires to be addressed.
The plantation companies experiment with various outgrower models as a last resort for their ills. As the tea industry is a highly labour intensive industry and the next wage increase agreement negotiations are to commence soon, the outcome of which is anybody’s guess.
If solutions are not found, capable workers will continue to exit the industry and the problems will become more severe. This is where the ‘voice’ of unions can play and important role. It is the cooperative function of unions to help build wage structures that can better incentivize work. The unions can also ‘voice’ to workers the importance of increasing the work norms. Unfortunately, most of the unions are politically driven. My personal view is that the unionists and the workers do not understand the heart of this matter.
The Planters’ Association is clamouring for a productivity drive. No doubt this must happen. However, productivity alone would not reduce the cost of production.
Despite large sums of money been directed by the Regional Plantation Companies to rehabilitate the industry, it has not been able to keep pace with the accelerating cost of production. With this high input of finances to the plantations, the yields and profits by now should have shown an upward trend. Several reasons have been attributed for this unhealthy state of affairs.
While the writer does not wish to be controversial, there are many deficiencies in both the agriculture and manufacture process that need to be corrected to arrest this situation. Although most of these issues have been discussed, it is still considered beneficial to re-examine this subject with an effort to improve the viability of this volatile sector.
The government should undertake a comprehensive assessment of underperforming plantation companies managed by the private sector case-by-case and evaluate the productivity, progress and development of plantations considering the profit and loss of the companies, annual yield, the progress of replanting, ethical management practices, utilization of land, supply of fertilizer, etc., which could affect the plantation sector in the long term.
We need to find new markets. We export tea to some countries whose economic and political situations are in turmoil. There are some potential markets. Iran is a good market but unfortunately there are sanctions on Iran. They buy some of the high-priced low growns. Russia is reeling from a falling rouble that is impacting heavily on the country’s economy and its trading patterns. Even China is a good market.
Where have we failed or gone wrong? Today the world is shifting so rapidly that we, ourselves, need to keep abreast of these changes but unfortunately, our tea industry has not kept in line with international tastes and preferences for tea. When there is international demand for different types of tea, there should have been an adequate response from the producers.
We have to take the option of taking tea out of the commodity market. For this perception, the policymakers and the stakeholders together have to come up with a new plan or a strategy.
There is a need for comprehensive support services linking the manufacture of tea, taking into consideration new thinking and planning, a need, which must be addressed quickly and thoughtfully, if we are not to lose a productive sector in the economy.
(Lalin I. De Silva is the Former Editor of Ceylon Planter’s Society Bulletin)

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Comments - 1

Damodar Boruah Saturday, 09 May 2015 03:31 PM

Reading the article I as a Small Tea Grower(STG) feel reflected with our own problem.Very Good article.Hope more with solutions.

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‘Tea crisis’: Where have we gone wrong?

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