Quality characteristics of Ceylon Tea record noticeable decline due to fertilizer ban

Any decline in the quality of Ceylon Tea will have serious consequences, where the Sri Lanka market share in a global arena would fall and as a result, a drop in exports and foreign exchange earnings is inevitable, Chairman of Colombo Tea Traders’ Association (CTTA) said.

Delivering the Chairman’s Speech at the virtual Annual General Meeting of the association, Jayantha P. Karunaratne highlighted that the decision to ban the use of Chemical Fertilizer and Agro Chemicals has begun to show a negative impact on the industry.

“The quantity offered at the weekly auction has shown signs of a decrease, whilst the quality characteristics have recorded a noticeable decline, as well,” Karunaratne said.

The decision by the government to ban the use of chemical fertilizer and agrochemicals effective May 2021, is causing grave concern to the tea industry.

Meanwhile, the high volatility of the exchange rate has also caused uncertainty and losses to the exporters and loss of opportunity to increase market share in International Markets.

“USD/LKR rate quoted by Commercial Banks does not reflect the real value. On and off payments received by the exporters are on hold by the US intermediary banks. These payments are sometimes held up for 2 to 3 weeks without credit being given to the exporter.”

The Colombo Tea Auction, however, has so far maintained the highest average price for tea in comparison with all other global auction centres.

The Colombo tea sale average from January to August 2021 is Rs. 618.80, as against Rs. 622.67 in 2020. Tea exports total 187.6 Mn kgs against 174.1 Mn kgs in 2020 recording positive growth.