Sri Lanka may cut 2018 tea production target after weak August

Reuters: Sri Lanka may have to downgrade its full-year forecast for tea production after output tumbled 14% in August from a year earlier due to a prolonged drought, the state-run Tea Board said on Tuesday.

The August decline meant output for the first eight months of this year fell 1.5% from the same period a year ago, it said.

“The fall is mainly because of the drought,” Sri Lanka Tea Board Director-General S.A. Siriwardena told Reuters, referring to the August data.

“There was no rain and the drought has been continuing. We will have to revisit the data and will have to revise the full-year projection.”

Industry officials have expected 2018 production to reach 320 million kg. 

Tea is Sri Lanka’s top agricultural export and one of the main foreign currency earners for the $ 87 billion economy.

Earnings from tea exports for the first six months rose 0.1% to $ 728.9 million, compared with the same period last year.

Sri Lanka’s tea output rose 5% to 307.1 million kg last year, recovering from a seven-year low of 292.6 million kg in 2016.

Tea production in 2017 was affected by severe drought followed by flooding and poor application of fertilisers, while a government ban on pesticides and restricted labour added to the sector’s problems.