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Sri Lanka’s tea industry down with lowest yield in 13 years

Sri Lanka’s tea crop suffered its lowest yield in 13 years, official data showed Friday, reducing output in its main export commodity as the island grapples with its worst economic crisis in seven decades, industry sources complained.

The country’s agriculture sector was hit hard by a ban on agrochemicals imposed last April as the Government introduced an ambitious plan to make Sri Lanka the world’s first nation to rely solely on organic farming.

Tea exports brought in $ 1.3 billion annually before the fertiliser ban Industry officials added that around 10% of Sri Lanka’s exports had also been affected by Russia’s invasion of Ukraine. Both countries are top buyers of Sri Lanka’s aromatic black tea.

ri Lanka’s Ceylon Tea exports fell 6.91 percent in January 2022 to 19.38 million kilograms from 20.82 million kilograms from a year ago, with Russia and Iraq being the top buyers, industry data showed.

Purchases by China dropped from 1.5 million kilograms last year to 738,000 kilograms in January 2022.

The island’s tea production dropped 0.36 percent in January 2022 to 22.82 million kilograms from 23.18 million kilograms in 2021.

“Elevation wise analysis shows that for the month of January 2022 Low Growns had recorded a decrease of 1.53 million kilograms whilst High & Medium Growns recorded an increase of 0.59 million kilograms and 0.58 million kilogram increase respectively when compared to the same period in 2021,” Ceylon Tea Brokers, a Colombo-based brokerage said in a report.

The free on board (FOB) price per kilo for the month of January 2022 was 948.24 rupees, up from 923.99 rupees a year earlier.

The January monthly average price for tea was 3.50 US dollars (704.67 rupees) compared to 3.30 US dollars (645.02 rupees) in January 2021, according to Ceylon Brokers data.

“Total export earnings shows a decrease of 0.86 Billion rupees (-4.46%) for the month of January 2022 as against the corresponding month in 2021,” Ceylon Tea Brokers said as the volume drop outpaced price gains.

The average price was 4.70 dollars a kilogram in January from 4.62 a year earlier.

Iraq was the top buyer of Ceylon Tea in January buying 3.80 million kilograms, up from 1.79 million a year earlier.

Meanwhile, Russia remained in second place buying 2.56 million kilograms higher than previous year’s 2.46 million kilograms.UAE bought 2.03 million kilograms, up from 1.11 million last year.

The crisis-hit Libya bought 1.13 million kilos in January 2022.Turkey which was a key buyer in 2021 slipped to 10th place buying only 0.52 million kilograms from the corresponding years 3.82 million kilograms.

China, which had been an emerging key buyer, bought only 0.74 million kilograms compared to 1.51 million kilograms last year. CIS countries bought 1.06 million kilos, down from 1.07 million last year.

The fertilizer ban was lifted in October following backlash from the industry but farmers were left unable to access imported fertiliser as the country simultaneously ran out of dollars to finance imports with the pandemic battering Sri Lanka’s tourism sector.

Monthly tea crops dropped to 18.16 million kilos (39.95 million pounds) in February, down nearly 20% from the corresponding period last year, the Sri Lanka Tea Board figures showed

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