Sri Lanka’s tea auction prices reach historic milestone
The Morning: The average price of a kilogramme of tea auctioned at the Colombo Tea Auction on 26-27 April 2022 surpassed Rs. 1,500 for the first time in its 127-year history.
Speaking to The Morning Business, Colombo Tea Trader Association (CTTA) Chairman Jayantha Karunaratne stated that the average price of tea sold at Sale No. 16 held on 26-27 April was Rs. 1,512.8, which represents a Rs. 142.3 (10.3%) increase compared to the previous auction (Sale No.15) held on 19-20 April 2022, at which the average price was Rs. 1,370.5.
“We have achieved a record average price at the Colombo Tea Auction, where it has never reached these Rs. 1,500 per kg price levels of tea. Increased demand, Sri Lankan Rupee depreciation and shortage of tea have played a part in reaching these record price levels,” stated the CTTA Chairman.
Explaining further, he stated that at the beginning of the year, the average price of tea sold at Sale No. 1 held on 5 January 2022 was around Rs. 662. Therefore, the average price of tea sold at the Colombo Tea Auction has increased by over 140% during 2022.
The Colombo Tea Auction, which is conducted by the CTTA, is known for maintaining the highest average price for tea in comparison with all other global tea auction centres. Since the outbreak of the Covid-19 pandemic, the Colombo Tea Auction has been conducted through an online platform.
There is hope that this drastic increase in Sri Lanka tea prices will offset any loss revenue caused by the decrease in crop volumes following the fertiliser crisis in 2021.
Sri Lanka’s tea industry is currently working towards regaining it’s prominent position enjoyed by Ceylon Tea in the past. Local tea authorities have launched several programmes to uplift and develop Sri Lanka’s tea industry to meet the growing demands in the international markets. Ceylon Tea is also being promoted in new foreign markets while adding more value to the country’s tea exports. The many trade agreements and trade concessions enjoyed by the country have also helped boost Sri Lanka’s tea industry. With Ceylon Tea undergoing an overhaul and the expansion in business/investment opportunities in the industry in line with the overall economic expansion in the country, foreign businesses/investors could explore opportunities in Sri Lanka’s tea industry.
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