Negative start for tea exports in 2012
The country’s tea industry has got off to a negative start in 2012 as far as exports are concerned, with dips in both volume and value.
The negative start has caused concern among industry analysts, whilst dampening optimism for higher exports in 2012 on the part of the Government.
Tea exports for the month of January 2012 totalled 23.1 million kilos, down by 1.2 million kilos over the corresponding month of last year. In value terms too total revenue of Rs. 11.8 billion reflected a dip of Rs. 1.1 billion over a year earlier, Forbes and Walker Tea Brokers said.
Tea in packets have shown a growth year-on-year (up from Rs. 4.1 billion to Rs. 5.1 billion, whilst it was negative for tea in bags (down to Rs. 1.83 billion from Rs. 2.2 billion) and tea in bulk (down to Rs. 4.4 billion from Rs. 6.3 billion).
Quantity wise, bulk tea exports were down to 9.8 million kilos as against 13.5 million kilos in January last year whilst tea in packets amounted to 10.8 million kilos, up from 8.1 million kilos a year earlier. Tea in bags had declined from 2.2 million kilos to 1.98 million kilos in January this year.
CIS continues to be the largest importer of Sri Lankan tea with a figure of 6.3 million kilos followed by Iran with 3.3 million kilos was higher from 2.2 million kilos last year. Other noteworthy importers are Syria (two million kilos up from 1.8 million kilos), Iraq (1.4 million kilos), Turkey (1.1 million kilos up from 1.1 million kilos and Libya (0.9 million kilos).
In January this year the approximate average unit FOB value per kilo was Rs. 510.49, down from Rs. 530.83 a year ago.
Earnings from tea exports increased by 3.5% to US$ 1,491 million, despite the slowdown in exports to traditional destinations in the Middle East during the second half of 2011. The average export price of tea rose by 5.1% to US$ 4.62 per kg during 2011, due to increased preference of tea importing countries for high quality ‘Ceylon Tea’ and global demand for orthodox tea, which accounted for nearly 90% of tea produced in Sri Lanka.
Due to geopolitical tensions in some of the major markets in the Middle East, export volume of tea declined marginally by 1.5% to 323 million kg in 2011.The share of value added tea exports out of total tea exports increased from 59.5% in 2010 to 63.9% in 2011.
