Sri Lanka’s tea export earnings in the first quarter of 2025 climbed 5% year-on-year (YoY) to $370.9 million, marking the highest Q1 performance in over a decade, according to Asia Siyaka Commodities PLC. Export volumes also rose modestly, reaching 63.2 million kilograms, up from 62.3 million kilograms in Q1 of 2024.
The average Free on Board (FOB) value per kilogram for the quarter was $5.87, exceeding last year’s $5.69. In rupee terms, however, total earnings dropped slightly to Rs. 109.9 billion from Rs. 110.9 billion, largely due to the strengthening Sri Lankan Rupee, which appreciated from Rs. 313 to around Rs. 296 against the US dollar.
The value-added segment of exports saw notable growth, increasing its share to 56% of total shipments, compared to 53% last year. This rise was driven by higher volumes in packaged tea, tea bags, instant tea, and green tea categories. March alone saw tea exports totaling 23.43 million kilograms, an increase of 2.18 million kilograms from the same month in 2024. Although tea bags slightly declined, other product categories recorded year-on-year growth.
In terms of pricing, the March FOB value per kilogram in rupee terms dropped to Rs. 1,753.16 from Rs. 1,795.87. Yet in dollar terms, the average rose slightly by $0.04 to $5.92. Over the quarter, the average FOB in rupees declined by Rs. 40.63 compared to last year, though it reflected a $0.19 gain in US dollar terms.
Iraq remained Sri Lanka’s top tea export destination, increasing its purchases by 7% to 9.02 million kilograms. Russia followed with 6.33 million kilograms, slightly below the previous year’s figure. Libya experienced a dramatic surge, importing 5.31 million kilograms compared to just 1.03 million kilograms last year—a 416% increase.
Other key markets presented mixed results. Exports to the UAE dropped 35% to 4.54 million kilograms. Turkey imported 3.32 million kilograms (down 19%), while Chile saw a 41% rise to 3.07 million kilograms. Iran imported 2.78 million kilograms, slightly ahead of China’s 2.47 million kilograms. Saudi Arabia and Germany were also notable importers, with 2.23 million and 2.22 million kilograms respectively.
Despite a marginal drop in rupee revenue, the strong performance in export volumes and rising dollar-denominated earnings reflect a positive outlook for Sri Lanka’s tea industry moving forward, supported by increased demand and a growing share of value-added products.
