Sri Lanka aims to increase tea export income by 78%
The Morning: Sri Lanka’s Ministry of Plantations announced that it is aiming to increase tea export incomes by 78% from earnings recorded last year and an increase in production by 52.5% by 2030, through the standardisation of Ceylon teas globally, a statement released by the Department of Government Information said.
“The Tea Development and Plantation Policy Division of the Ministry of Plantations and Community Infrastructure is working to introduce a reliable standardisation of Ceylon Tea that will protect its brand name internationally and ensure its naturalness and quality,” the statement said.
“Under this, it is expected to increase Sri Lanka’s tea production to 400 million kilogrammes within the next five years and increase the income generated from it to $ 2.5 billion.”
In 2024, Sri Lanka’s total tea production was recorded at 262.16 million kilogrammes – a marginal 2.4% increase in production from the 256 million kilogrammes recorded in 2023.
In the same year, earnings from tea exports also showed a marginal increase of 9% from the previous year’s earnings, at $ 1.43 billion. Earlier this year, the Tea Board of India reported that India surpassed Sri Lanka’s yearly tea exports by 24 million kilogrammes.
Industry persons attribute the low production to substantial setbacks in policy and government intervention ever since the industry was faced with the fertiliser crisis, and forebodingly awaits the removal of the SVAT voucher system later on in the year.
The standardisation process is to include the implementation of internationally recognised sustainability farming practices, regenerative agricultural practices, forest-degradation-free farming practices and zero-carbon industrial practices, the statement said.
It concluded that a memorandum of understanding (MoU) on the standardisation had been signed a year prior, between the Ministry of Plantation Industries and Community Infrastructure, with a progress discussion having been held recently.
OSL take:
Tea exports form a considerable portion of Sri Lanka’s revenue from exports. The tea industry has shown a steady growth with Sri Lanka’s tea and tea-based products recording an increase in prices in foreign markets, indicating an increasing growth and business potential in the export of local tea and tea-based products. Sri Lankan authorities have also been engaged in several programmes to further uplift and develop the local tea industry. These measures range from promotional campaigns in overseas markets to introducing incentives to attract more businesses into the tea industry and encouraging local tea exporters to add more value to their products as well as diversify Sri Lanka’s existing tea export portfolio. The many trade agreements and trade concessions enjoyed by Sri Lanka have also helped boost the country’s tea and tea-based products in foreign markets. All these have resulted in the expansion of the local tea industry creating a host of business/investment opportunities in Sri Lanka’s tea industry. Given the expansion programmes undertaken by local tea businesses and the profits being recorded, foreign businesses/investors could explore the growing opportunities in Sri Lanka’s tea industry. Foreign businesses/investors could also look at expanding operations by forming partnerships or joint ventures with local businesses in the tea industry.
Article Code : | VBS/AT/20250522/Z_1 |