Sri Lanka Tea Makers Benefit From Soaring Prices

Soaring tea prices in the world market will soon provide a boost to the tea industry in Sri Lanka, Dilhan Fernando, Director of Dilmah Tea told foreign media. Consequently, the Sri Lankan economy will also benefit greatly since Sri Lanka is the world’s second biggest exporter of the crop.

However, he pointed out that mounting production costs are growing demand might balance off this advantage. He expressed confidence nevertheless that strong prices will halt the long slide in tea prices and boost earnings for producers.

Sri Lanka earned a record 1.03 billion dollars in 2007 from tea exports. Value-added tea is selling at higher prices, industry officials said.

Brokers said growing disposable incomes in oil exporting countries, where tea is part of the basic food basket for many families, would also lift local demand this year.

With global levels of production and consumption converging at about 3.6 million tonnes a year, the FAO said any hint of bad weather, further political violence in a leading supplier (Kenya) or a bigger thirst for tea will lift prices.

Source: Government of Sri Lanka

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