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Saturday, 20 February 2021 00:40 - - {{hitsCtrl.values.hits}}
The tea industry witnessed an increase in production and began the year with lower export volumes, but with higher returns, brokers said yesterday.
The country’s tea production in January increased by 5% to 23 million kilograms (MnKg) compared to 21.9 MnKg a year earlier, where the boost of production was generated entirely from the Low Grown sector.
The year-on-year (YoY) low grown sector production increased from 13.3 MnKg in 2021 to 14.9 MnKg, which is at three-year high following more favourable growing conditions and availability of fertiliser. However, the high and mid growns were lower YoY 2020 by 5% and 6% respectively.
Sri Lanka Customs data analysed by Asia Siyaka Research confirmed that the country›s export volume in January dropped by 6% to 20.8 MnKg compared to 22 MnKg shipped in a year earlier. However, the earnings in January increased by 6% to Rs. 19.2 billion ($ 101 million) compared to Rs. 18 billion ($ 99.7 million) recorded in the corresponding period last year.
When analysing the main categories of exports Forbes and Walkers said bulk tea and tea bags had shown an increase, whilst packeted tea decreased marginally in January 2021 compared to the corresponding period a year earlier.
Based on the quantity of 20.8 MnKg shipped, the FOB value of Rs.923.99 ($4.87) records the highest-ever rupee FOB value, surpassing the previous highest of Rs.902.29 ($4.89) recorded in June 2020. In US Dollar terms, more or less static. However, when compared to Rs.818.86 ($4.55) of January 2020 records an increase of Rs.105.13 ($0.34), but lower than the FOB figure recorded in January 2017 $5.03 and 2018 $5.32.
Turkey with 3.8 MnKg emerged as the largest importer for January 2021 followed by Russia with 2.4 MnKg and Iraq with 1.7 MnKg. Other noteworthy importers were China with 1.5 MnKg, UAE with 1.1 MnKg and Azerbaijan with 919,184 Kg. It is important to note that destinations such as Iran, Saudi Arabia and Libya have shown a significant decrease in imports for the period under review.
