Sunday, September 24, 2023

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Tea crop improves marginally in April despite fertilizer issues

By: Staff Writer

Colombo (LNW): Sri Lanka’s tea production in the first four months of 2023 dropped 20% to a three-year low of 84 million kg, an industry official said, as the key sector struggles with the impact of a chemical fertilizer ban and economic crisis.

The island, hit with its worst financial crisis in seven decades, implemented a now-scrapped ban on chemical fertilizer early last year, which caused tea production to drop by 16% in 2022 from 2021, government data showed.

Despite the reversal of the ban, months passed before sufficient fertilizer stocks were imported and prices have soared in the interim, industry experts said.

Sri Lanka’s tea crop has begun to see a marginal improvement in volumes, as a result of favourable weather conditions and robust distribution of fertilizer.

In April, tea production increased by 8% year-on-year to 24.72 million kilos, but the 2023 first four months crop dipped by 2.49% compared to 2022 reflecting the struggle for recovery after detrimental policy decisions.

Data analysed by Forbes and Walkers Research confirmed that in April all elevations have shown a steady growth in volume in comparison with the corresponding period of 2022.

High-grown elevation produced 6.04 million kilos up by 7.11% YoY whilst, medium elevation production was 4.37 million kilos up by 6.29% YoY, and low-grown elevation crop was up by 8.04% to 13.05 million kilos. The production of green was at 206,167 kilos in April 2023, up by 113.54% YoY.

However, on a cumulative basis, all elevations have shown a decline over the corresponding period of 2021.

January-April 2023 cumulative production totalled 84.09 million kilos, registering a drop of 2.14 million kilos or vis-à-vis 86.23 million kilos YoY.

Forbes and Walker Research showed that compared to 2022, all elevations except for the low-grown and green tea segments have shown negative variances in the year 2023.

High-grown elevation produced 18.62 million kilos down by 8.46% YoY whilst medium elevation production was 13.3 million kilos down by 5.61% YoY. However, the low-grown elevation crop was marginally up by 0.29% to 51.35 million kilos and the green tea crop was at 806,447 kilos, up by 37.59% YoY.

When compared to 104.54 million kilos of January-April 2021, cumulative production of 2023 shows a decrease of 19.57% or 20.46 million kilos.

Industry growers had said that some estates were cut off from fertilizers for up to 18 months and they warned that it had a detrimental impact on crop production. In addition, the cost of production of tea growers has steeply risen by around 30% amidst the foreign exchange crisis.

As per the Sri Lanka Tea Board, the country’s total national production for the year 2022 was 251.50 million kilos compared with 299.49 million kilos in 2021. This was the lowest in 26 years when 246 million kilos were produced in 1995.

Sri Lanka expects tea production to recover in 2023 to 300 million kilos, whilst targeting export earnings of $ 1.5 billion for the year.

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