Sri Lanka’s 2024 tea production reaches three-year high
Daily FT: Sri Lanka’s tea production hit a three-year high in 2024, bouncing back from detrimental policy decisions in 2021 and the lingering impacts of climate change.
The cumulative tea crop for the year reached 262.15 million kilos, marking an increase of 6.07 million kilos or 2.4% year-on-year (YoY) growth compared to 256.08 million kilos in 2023.
Data analysed by Asia Siyaka Commodities showed all tea-growing elevations posted positive variances in 2024, with the exception of the high-grown sector due to excessive rainfall during the second quarter which contributed to a decline in output in the region.
“Production gains came primarily from the medium-grown elevation, by a sharp 12.5% YoY increase to 47.62 million kilos, while low-grown tea, which accounts for the majority of the production, saw a modest 2.4% rise, reaching 158.81 million kilos. The high-grown region produced 55.72 million kilos, a 5% YoY decrease, reflecting its vulnerability to climatic conditions,” it added.
Despite the improvement, 2024’s total production fell short of the 299.49 million kilos achieved in 2021, registering a drop of 37.34 million kilos.
Asia Siyaka said December 2024 contributed 21.71 million kilos to the annual total, a 9.6% YoY increase compared to 19.08 million kilos in December 2023.
All elevations performed better in December 2024 relative to the same period a year ago. High-grown tea edged up by 0.4% YoY to 4.60 million kilos, medium-grown tea surged by 26.6% YoY to 3.75 million kilos, and low-grown tea production increased by 9% YoY to 13.35 million kilos.
The December 2024 output also shows a 1.19 million kilo increase compared to 20.52 million kilos registered in December 2021.
Tea production categories also painted a largely positive picture in 2024. Orthodox tea, the dominant category, registered a 2.2% YoY increase, totalling 236 million kilos, whilst CTC tea saw a 4.7% YoY rise to 23.68 million kilos. However, green tea lagged slightly, falling 1% YoY to 2.26 million kilos.
In December 2024, tea production categories showed broad-based gains, with orthodox tea rising 10.1% YoY to 19.59 million kilos, CTC tea increasing by 5% YoY to 1.93 million kilos, and green tea climbing 5.3% YoY to 190,307 kilos.
It was noted that these production improvements were achieved despite irregular weather patterns and modest fertiliser usage by smallholders, who contribute nearly 75% of the national tea crop.
Asia Siyaka believes if the growing conditions remain stable, production could exceed 275 million kilos in 2025.
OSL take:
The steady growth in Sri Lanka’s tea production indicates the overall growth and the expansion of business/investment opportunities in the industry. The growing business potential in Sri Lanka’s tea industry is evident by the incentive schemes being offered by the local tea authorities to businesses in the industry as well as newcomers to the sector. The local tea industry has already adopted many best global practices in the industry and is engaged in the production of sustainable tea and tea-based products. The many trade ties enjoyed by Sri Lanka with many foreign countries and the further strengthening and expansion of the country’s trade ties would give a further impetus to Sri Lanka’s tea industry. Sri Lanka’s exports sector is also working on further boosting the tea industry by pushing for more value-added products to expand the existing export product portfolio and the expansion of foreign markets. These movements also indicate a growth in the business/investment opportunities in sectors related to the tea industry that include the development of infrastructure and supplementary infrastructure facilities as well. All these developments are indicative of the expanding business/investment opportunities in Sri Lanka’s tea industry and related sectors.
| Article Code : | VBS/AT/20250123/Z_4 |