Holistic long term plan needed to resurrect tea industry

Nimal Sanderatne in his column titled “Killing the goose that lays the golden eggs” in the Sunday Times of May 13, quite correctly indicates that “a new resolve to enhance productivity and increase production of tea to increase exports could be of immense benefit to the economy”.

Although tea is considered the highest export earner, its performance during the last five years has been dismal. Production of tea during this period has shown a downward trend from 340 million kg in 2013 to 307 million kg in 2017 except for a marginal increase during 2017. The average tea yield (kg/ha) does not show any substantial increase and in fact, has decreased during the last two years. About 95% of the tea produced is exported. The weight of tea exported during the period 20142017 has continued to decrease from 327 million kg to 288 million kg. Export earnings from tea in US dollar terms has not increased by any substantial amount during this period. In fact it has decreased during 2015 and 2016.

A number of factors could be attributed to this state of affairs in the tea sector.

Low yields:

The average tea yields are considerably lower than the potential yields. It has been reported that some of the cultivars developed by the Tea Research Institute of Sri Lanka had been yielding around 8,000 kg/ha in South India under commercial conditions. However, the average tea yield in Sri Lanka is much lower. In the smallholder tea sector the average yield is around 1800 kg/ha and in the estate sector it is about 1200 kg/ha.

Increasing cost of production

The cost of production of tea (Rs/ kg) has continued to rise during the last few years. The average cost of production of tea, has risen from Rs. 390 /kg in 2010 to Rs. 434 in 2014. In 2017 COP is Rs. 466/kg. It is likely that it will increase in the present year due to the rise in fuel cost. This is mainly due to rising prices of all the inputs such labour, power, fertilizers, pesticides and decreasing yields.

Land degradation:

Productivity of tea lands indicated by yield/ha has declined during the last few years possibly due to undesirable weather, and soil erosion leading to infertile soils.

Land degradation due to soil erosion is evident in many parts of the country. In the up and mid country, i.e lands above 300 m, severe land degradation has been reported. In up country districts such as Nuwara Eliya, tea is one of the main crops cultivated and in those lands where proper soil conservation practices are not carried out soil erosion takes place.

At the first national workshop on Sustainable Land Management held a few years ago, Dr. M.A. Wijeratna of the Tea Research Institute revealed that around 40 t of soil/ha/year is lost due to soil erosion in the mid and up country tea lands. There are some tea lands in which the average yield is as low as 600kg/ha/years and this is likely to be due to depletion of soil fertility due to soil erosion

Old crops:

A considerable part of the tea crop is old. For example, according to Tea Research Institute data, about 40% of the tea extent is under seedling tea and about 90% of the seedling teas are over 60 years old and need replanting. Around 30% of the VP tea is more than 30 years old and these also need replanting. The annual extent replanted has decreased from 1857 ha in 2011 to 1067 ha in 2017. Low replanting is mainly due to high costs involved. There are nearly 400,000 tea small holdings mostly in Ratnapura, Galle, Matara, Kandy, Badulla, Kalutara, Nuwara Eliya and Kegalle and their productivity is much higher than those of the commercial tea plantations. Hence they need to be provided assistance to replant.

As Mr. Sanderatne has indicated we need to emphasize on increasing production and improving productivity in tea holdings. To achieve this objective it is essential to address these issues. In view of the important role played by the tea sector on the socioeconomic development of the country it is important that the factors which limit the productivity and profitability are given serious consideration.

Medium-long term measures

There are some tea lands in which the annual production is even less than 500 kg. A survey needs to be done to identify these unproductive lea lands. These unproductive tea lands need to be diversified. Such tea lands may be put under pasture and have cattle. This will reduce our expenditure on milk imports, and also degradation of the lands will be reduced resulting in less silting of the reservoirs. There are many other crops such as spice crops etc. which could be cultivated on the unproductive tea lands. These crops would give better returns to the cultivators.

Those tea lands which are not going to be diversified need to be managed better. In this regard, infilling, cultivation of better tea cultivars and their effective management including better fertilizer and pest management practices, increased rate of replanting, reducing soil degradation and conservation practices are essential In this regard, cultivation of better tea cultivars and their effective management including better fertilizer and pest management practices, diversification, improved manufacturing and value addition of the produce, increased rate of replanting, reducing soil degradation and conservation practices are essential. All these activities would involve a high level of capital investment and also, effective implementation of policies. In the National Plantation Industry Policy Framework developed some time back, it was estimated that around Rs. 83 billion is necessary during 2007-2016 for improvement of the tea sector.

It is essential that a holistic long term national plan to resurrect the tea industry and to develop better land use practices is developed. Such a plan should look into all aspects of tea production including cultivation, processing and marketing.

It may be worthwhile to consider reducing the extent under unproductive tea and bring the land made available under a different land use system, and concentrate on the improvement of the productivity of the productive tea lands. By adopting this approach, the land productivity as well as the worker productivity could be improved while minimizing the cost of production.