May tea exports dip but first five-month haul higher

Sri Lanka tea exports in May saw a marginal dip although the first five months’ value has shown an improvement. 

Customs data analysed by Siyaka Research shows that Sri Lanka exported 23 Mnkg in May 2018, 5% lower than the 2017 quantity of 24.3 Mnkg. The country earned Rs. 19 billion compared with last year’s record of Rs. 20 billion from the larger quantity shipped. 

Shipments for January-May 2018 at 112.8 Mnkg are near identical to the previous year’s figures. However, what is significant is that bulk tea shipments rose to 43% from the total from 42% a year ago.

Therefore, the other segments which are treated as value added exports have declined to 57% of the total from 58% a year ago.

A key positive element of this year’s performance from January-May are rupee earnings which are up 5% to Rs. 93.3 billion from Rs. 89.2 billion a year ago. This converts to an approximate $ 599 million ahead of the previous year’s figure of $ 589 million. The highest earnings for the period were $ 650 million in 2014 but the country exported 126.7 Mnkg, which is 12% more than the 2018 quantity of 112.8 Mnkg. The comparable approximate FOB value therefore is $ 5.31 million from January-May this year against $ 5.14 million in 2014.

A review of the prime destinations show Russia/CIS at the top of the list with absorption of 21.4 Mnkg against 22.1 Mnkg a year ago. Iraq is second with 14.9 Mnkg against 12.5 Mnkg, recording a sharp 19% YoY increase. The quantity shipped through Turkey has grown from 12.9 Mnkg to 13.9 this year. A key negative feature of this year’s performance is from Iran, which has seen a sharp drop of 18% YoY 2017 to 8.5 Mnkg from 10.3 Mnkg last year. 

The UAE too has declined to 5 Mnkg from 6.6 Mnkg a year ago. Shipments to Syria have risen 55% to 4.3 Mnkg from 2.8 Mnkg. China continues to grow and is 4.2 Mnkg, up 30% from last year’s five-month figure of 3.2 Mnkg. Libya has dropped sharply from 5.2 Mnkg to 3.5 Mnkg this year. Chile remains steady at 2.6 Mnkg and is followed by Japan’s 2.66 Mnkg, down a sharp 19% from 3.2 Mnkg. This high-value market has a strong impact on better liquoring Dimbulla and Uva teas. Saudi Arabia has grown imports to 2.3 Mnkg from 1.6 Mnkg a year ago. The US is nominally ahead at 2.27 Mnkg compared with 2.19 Mnkg in 2017.