AUGUST TEA PRODUCTION LOWEST IN 28 YEARS

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Sri Lanka’s tea production last month (August 2022) was the lowest in 28 years, Forbes and Walker Tea Brokers, in a report released on Wednesday (21), said.

Scarred by President Gotabaya Rajapaksa’s seven-month chemical fertiliser ban, effective from April to November 2021, tea production last month recorded 18.27 million kilos, it said. A figure lower than this last took place in August 1994, where tea production registered a figure of 16.20 million kgs, Forbes further said.

Sri Lanka had its Parliamentary Poll on 16 August 1994, where the SLFP-led PA coalition won the poll, ending the UNP’s 17-year rule.

Meanwhile, last month’s tea production of 18.27 million kgs is a year on year (yoY) decline of 30.65 per cent (5.60 million kgs), where, a year ago in August 2021, tea production recorded a higher figure of 23.87 million kgs.

Consequently tea production in the first eight months of the year declined to a 26-year low, registering a figure of 171.37 million kgs.  A lower figure than this for the period January to August was registered in the period January to August 1996, where a figure of 169.7 million kgs were recorded,  said Forbes.

In the year 1996 Sri Lanka experienced a drought hitting tea production, made worse by the LTTE bomb attack on the Central Bank of Sri Lanka (CBSL), which took place on 31 January 1996, further disrupting the economy.

Meanwhile, tea production of 171.37 million kgs in the first eight months of the year, is a YoY decline of  19.15 per cent (40.60 million kgs), where, in the first eight months of last year (2021) tea production registered a figure of 211.97 million kgs, said Forbes.

Consequently, tea export earnings in the first eight months of the year declined by 6.31 per cent (US$ 56.21 million) to $ 834.79 million (fob) year on year (YoY) and export volumes were down by 9.65 per cent (16.51 million kilos) to 171.06 million kgs in the same period, Forbes said.

Tea was Sri Lanka’s third largest foreign exchange earner in 2020 and 2021, CBSL said. The definition of ‘fob’ is the price of tea loaded for shipment at the seller’s port to an export destination. It discounts other costs such as freight and insurance charges.

(PA)