Adverse weather impacts tea production

Prolonged heavy showers and strong gale force winds have drastically impacted tea production with some estates having recorded only 40% of their estimated average yield in the past two months.

Regional Plantation Companies (RPC's) said that with crops declining, the coming months will be critical for the plantations with regard to the bottom-line.

The adverse weather conditions with rainfall being the highest in 47 years has impacted Cost of Production (COP) which has escalated to more than double, averaging around Rs 700 among some estates, particularly in the Nuwara Eliya regions.

Those severely affected are estates in and around Nuwara Eliya, Hatton, Dickoya, Agrapatna and Talawakelle areas from which some of the best upcountry teas are harvested. At present, crop yields are only 40 to 45% of the average, thus sending alarm signals to producers. "Buyers must take note of this critical situation that is prevailing," said General Manager, Elpitiya Plantations, Senarath Pahathkumbura, a veteran planter.

"Present COP due to the bad wet weather is between Rs 700 and 730 per kilogram while Net Sale Averages (NSA) are around Rs 325 thus incurring a severe loss to the producers," he said. Pahathkumbura said that buyers should consider the situation and pay the producers a reasonable price per kilogram of tea. "A low yield means low productivity and therefore high Cost of Production, irrespective of productivity parameters". The decline in crops is a further blow to the tea and rubber industry which is already reeling from the impact of the wage hike to workers. Sri Lanka's cost of production of tea is the highest in the world with 65% of the cost attributed to labour.