Sri Lanka‘s tea exports fall for 11th consecutive month

Aug 21, 2015 (LBO) – Sri Lanka’s Tea exports, continued to decline in June 2015 for the eleventh consecutive month, due to lower demand from main tea buyers such as Russia and the Middle East, as well as the unit price with the lowest export price of US dollars 4.39 per kg of tea being recorded since September 2012.

Tea exports recorded a drop of 20.1 percent in June this year.

Official data shows Sri Lanka exported 121.9 million US dollar worth tea in June 2015 compared to the 152.6 million US dollar tea exports in the same month last year.

Tea exports to Russia and the Middle East declined by 29 per cent and 24 per cent, respectively, during May 2015 compared to the corresponding month of 2014.

Earnings from exports of textiles and garments declined reflecting lower exports to EU countries despite the growth in exports to both the USA and non-traditional markets.

For the first six months from January to June 2015, tea exports declined 14.3 percent to 682.9 million US dollars compared to 797 million US dollars in the same period of 2014.

Sri Lanka’s Tea exporter, Dilmah said in its annual report that tea exporters who create various brand names at very cheap price levels in the global market are to be blamed on the lesser demand for “Ceylon Tea”.

“As I pointed out in several of my previous reports, this misfortune is our exporters own creation; developing importers’ own brand names at very cheap price levels which are extremely harmful to long-term interests of our tea industry,”

“My warnings, sounded year after year, on this pending danger were not heeded by tea interests or by the government,”

“Now, we have begun to pay the penalty for this neglect resulting in far less demand for bulk tea resulting in lower prices and negligible demand for value added tea from the very sources that benefited from our exporters’ generosity towards establishing their own brand names at low cost,”

“Those brand names now purchase cheaper tea from other sources such as Vietnam, Indonesia, China, causing serious harm to the quality and image of Ceylon tea by supplying under the same brand names and labeling cheap blends as “CEYLON TEA”.”