Tea industry continues to move towards negative growth trajectory in September
September production and revenue show YoY decline of 7.5% and 15.5% Russia emerge as the largest importer China, India and Pakistan show significant growth in imports
The tea industry continues to move towards a negative growth trajectory with production and revenue for September showing a YoY decline of 7.5 percent and 15.5 percent. However, improved purchases from key markets in the Asian region indicate the situation could improve if the demand sustains.
While tea exports for September 2015 totalled 24.6 M/kgs showing a decrease of 2M/kgs compared to 26.6 M/kgs in September 2014, Russia has emerged as the largest importer followed by Turkey and Iraq, whereas new markets China and India has improved the volume of imports from Sri Lanka YoY.
Furthermore, Pakistan imported substantially a higher volume than the corresponding period last year. Analysts note these developments are good signs for the local tea industry.
Cumulative exports for the period January to September 2015, including re-exports with imported tea, amounted to 226.10 Mn/ Kg, showing a 6.33 percent drop compared to the same period last year. FOB price per Kg recorded Rs. 595.95 vis-à-vis Rs. 657.58 for the same period in 2014.
Latest weekly tea market report from Forbes and Walker Tea Brokers showed that bulk tea exports in September have shown a growth YOY whilst tea bags and packeted tea have shown a negative growth compared to the corresponding month the previous year.
Total revenue of Rs.14.7 billion realised for September 2015 too contracted by Rs.2.7 billion vis-à-vis Rs.17.4 billion recorded during September 2014.
The local tea production for September which totalled 26.8 M/kgs also followed suit with volumes showing a deficit of 2.2 M/kgs compared to September 2014.
The High Grown production showed a marginal YoY gain, whereas Medium Growns and Low Growns showed a negative growth compared to the corresponding month the previous year.
Cumulative production of 252.6 M/kgs recorded in the first nine months also showed a drop of 2.9 M/kgs vis-àvis 255.5 M/kgs of January – September 2014.
(SAA)