Regional Plantation Companies show higher productivity

The Planters Association (PA) says Regional Plantation Companies (RPCs) show consistently high productivity in tea cultivation.

In a press statement, the PA noted that based on national statistics, yields and re-planting rates are higher within the RPC sector than the small holdings sector in tea cultivation. This is despite a sharp increase in production costs due to wage increases and difficult weather conditions.

The Sri Lanka Tea Board statistical booklet 2009 shows a yield of 1,762 kgs per hectare, for high grown tea in 2009. A majority of land cultivated for high grown tea (86%) is under RPC control, with RPC tea plantations accounting for 35, 432 hectares, out of the 41,137 hectares, of high grown tea land in the country.

Land management

The land management of low grown tea cultivation on the other hand, is the opposite, with small holdings accounting for the majority share. Almost 87% of the low grown tea land area is under small holder management.

However, according to the statistics of the Sri Lanka Tea Board for 2009, the yield from low grown tea was 1,576 kgs per hectare, which are lower then the high grown tea yield.

“The data on yields, from high grown and low grown tea cultivations, show that the yield is higher in RPC managed tea lands than in small holdings,” said Roshan Rajadurai, Deputy Chairman of the PA.

However, the PA notes that tea cultivation in the low country has the potential for higher labour productivity than RPC managed estates in the up country. Small holdings are cultivated as a family owned business venture. This results in small holding families themselves doing some of the work, which keeps labour costs low and also allows for greater interest in gaining higher yields.

Labour, when hired from outside, is paid on the number of kilos of tea plucked by the worker. Since the workers do not get a fixed minimum daily wage, or other benefits such as EPF and ETF, they work harder to maximise their incomes. The PA notes that this combination of hired labour and family ownership should help increase productivity in the low grown tea sector.

Productivity

“Low grown tea lands should show higher productivity because they work their own fields. When they hire outside workers, these workers are not paid other benefits. They are paid strictly on how many kilos they pluck. So the workers also work harder to improve their incomes. This is not the case with workers in RPC estates. In RPCs workers are paid a minimum wage and have many other attendant benefits, irrespective of their level of productivity. This situation in low grown areas should also contribute towards higher yields, than from RPCs,” said Rajadurai.

Land productivity is also affected by weather patterns, say the PA. Lowlands are generally seen to have more conducive weather all year round, than high grown tea plantations.

“Low grown areas have better distributed rainfall and better climatic conditions for crop growth throughout the year than lands in high elevation. This is seen in most countries. So again the yield should be higher from the low grown estates compared to the highlands,” said Rajadurai.

More replanting

The PA says replanting rates among RPCs is also higher than among the small holdings, contrary to popular belief. According to statistics from the Ministry of Plantation Industries, from 1995, after privatisation of estates, up to 2008, tea small holdings replanted 6%, or 8,084 hectares, out of their land area.

The RPCs on the other hand, replanted 9%, or 7,406 hectares, of tea holdings under their management during the same period. New planting rates on the other hand, are higher in the tea small holding sector with 3,137 hectares of new planting compared to 68 hectares of new planting in RPC tea lands.

“Replanting is highly capital and labour intensive. You need around 4,000 workers to replant one hectare of tea land, for the six years from uprooting to bearing stage. In addition to the cost of hiring labour, there is also difficulty in sourcing so much labour for replanting, because the estates must also meet the daily labour requirement for important revenue generation activities such as plucking and other important field up keep and processing activities. The cost of replanting is approximately Rs 2.5 million for a hectare, following the guidelines set by the Tea Research Institute,” said Rajadurai.

The PA maintains that the RPCs are committed towards increasing replanting levels and improving productivity of their estates despite the many drawbacks related to agronomic factors including land suitability and adequacy of recommended planting materials, shortage of labour, adverse impact on National production and quality of Ceylon Tea and most importantly, financial constraints faced by them.