Sri Lanka is at the risk of losing its position as Russia’s biggest tea import destination, to India in 2015 as statistics up to September 2015 suggest the island had exported a mere 26,570 Metric Tonnes (MT) of Tea although its neighbouring country exported 5,430 MT more than Sri Lanka.
Releasing an Industry Assessment, the Ceylon Tea Brokers Plc opined that the fall in Sri Lanka’s tea exports was largely due to the turmoil in the oil exporting countries in the Middle East who are the country’s biggest importers of Tea. The report warns that if proactive action is not taken to diversify trade with other regions, the Tea Industry could be facing a bleak future.
“The Russian rouble declined 24% against the US$ in 2015. Consequently exports from Sri Lanka to this important market recorded a 20% drop in 2015 compared with the previous year. If there is more stability in the political and economic condition globally during the current year there could be an improvement in our market access to this region,” the tea brokerage firm pointed out. It further noted that China’s economic slowdown in 2015 resulted in lower commodity prices globally while GDP’s of the oil dependent countries such as Russia, Iran, Saudi Arabia etc was severely affected in turn triggering an impact on the island’s Tea Industry.
In 2015, Sri Lanka’s tea production reduced by about 10 million kilos produced in 2014 to 328.96 million while exports decreased by a higher 20.91 million kilos compared to 2014 creating a glut in the market.
While advocating that Sri Lanka should seek to significantly diversify its interests in the export sector by extending its horizons, the Ceylon Tea Brokers report said that a Tea Hub such as that which has been established in Dubai with the necessary safeguards and regulations could benefit the expansion of the Industry enabling significant trade with a wider cross section of countries globally.