Sri Lanka Tea Board Chief remains optimistic despite 1Q setback

• Targets tea output at 260 m kilos, $ 1.3 b revenue in 2024
• Attributes challenges in 1Q to dry weather, low fertiliser application by smallholders
• Outlines efforts to support smallholders via subsidised fertiliser distribution 
• Reiterates quality over price in global tea market 
• Highlights need for aggressive targeted promotional strategies 

By Charumini de Silva

Despite the temporary setback in tea production in the first quarter, due to the dry weather and low fertiliser application by smallholders in Q1, the Sri Lanka Tea Board (SLTB) Chairman Niraj de Mel was optimistic that the tea output could still reach 260 million kilos and generating around $ 1.3 billion in revenue for 2024.

“We were hopeful of a positive year, but the good work of January and February was wiped out in March with the first quarter ending up in a negative manner. Our heavy cropping months are the second three months of the first half where we really produce large quantities. I am still hopeful that we can still reach 260 million kilos and earn about $ 1.3 billion,” he said yesterday.

The efforts to support smallholders through subsidised fertiliser distribution were underscored as crucial in mitigating production challenges. “The State-owned fertiliser companies disbursed Rs. 200 million worth of 5,000 tons of fertiliser as the first tranche, following directives from Agriculture Minister Mahinda Amaraweera. The total SLTB commitment is Rs. 1.2 billion to distribute 30,000 tons of fertiliser to smallholders, aiming to boost productivity and yield,” de Mel added.

Highlighting the importance of quality over price in the global tea market, SLTB Chief asserted the need for aggressive marketing and promotional strategies.

He acknowledged the prevalence of price wars among tea-producing countries and stressed the significance of Sri Lanka’s reputation for high-quality tea. “Recent endorsements from key importing countries’ trade associations reaffirm the importance of quality and taste in consumer preferences, providing an opportunity for Sri Lanka to leverage its strengths in the market,” he pointed out.

He said the only way to tap into this market is through aggressive targeted marketing efforts to differentiate Ceylon Tea from competitors. 

“The marketing strategies we implemented last month in London and Scotland were well-received. Relying solely on supermarket shelf presence risks engaging in a price war, undermining our competitive edge. Sri Lanka has successfully maintained its position in the global market and it is reflected in the consistently high auction prices. This underscores the demand for Ceylon Tea, making it a sought-after choice for consumers worldwide,” de Mel stressed.