‘Blending with low quality for re-export not prudent’:

Tea Board chief decries tea blend move

by Rohana Jayalal

The move to import low quality tea on a large scale from countries such as Kenya and blend it with Ceylon Tea for re-export, is not prudent. Although tea is imported at present for re-export it is not blended with Ceylon Tea, Sri Lanka Tea Board Chairman, Rohan Pethiyagoda said.

Despite Sri Lanka being deprived of the status of being the No. 1 tea exporter there is strong demand for Ceylon Tea in various countries. Most countries import Kenyan tea due to low prices notwithstanding its poor quality. If not for the high prices, Ceylon Tea would have found more markets, he said.

Sri Lankan tea fetches the highest FOB (Freight on Board) value per kilogram in the world. It maintains the top position among tea producing countries as export revenue earner. Imports for the re-export market are low at present.

Sri Lanka’s tea exports surpassed the $1 billion mark in 2015 despite the decline in domestic tea production.“Kenya surpassed Sri Lanka in export volume during the past few years due to drought and heavy rains which damaged crops and resulted in a fall in tea production in Sri Lanka. A severe drought and heavy rain in the past few years reduced our output and Sri Lanka had a lesser quantity of tea for export,” Pethiyagoda said. Sri Lanka is still the number one orthodox tea exporter in the world and exported 290 million kgs of orthodox tea last year. Kenya exports CTC teas suitable for tea bags, he said.

“The Cut-Tear-Curl (CTC) method of manufacture is popular in African countries and it is limited to about 6% in Sri Lanka,” Pethiyagoda said.

He said that the diversity in orthodox tea processing has been the power and strength of the tea industry in Sri Lanka.

Kenya’s tea exports often exceed production because it imports leaves and then re-exports them blended with local produce. But imports of tea into Sri Lanka are restricted because of opposition by producers who fear imported teas could reduce prices for their own product at the Colombo auctions. According to records, Sri Lanka imports 25.3 percent (around 5,303,403 kilos) annually, Pethiyagoda said. Sri Lanka doesn’t import leaves and then re-export it on a large scale because Sri Lanka’s tea still commands consumer preference in the global market, a tea planter in Nuwara Eliya, Milan Leonard said.

But a strong foundation should be laid by the Government to support and guide local producers to reach the needed quality, by introducing a quality certificate for the long term sustainability of the tea industry.

Today, installing new technology is more essential than introducing new types of tea for the niche markets. There is a great demand for such tea. Consumers select alternative tea such as Rooibos, Heneybos and other herbal teas that do not have caffeine.

Consumers are becoming more health conscious. Price is no barrier for exclusive and innovative teas in the global tea market. Value addition along with satisfying quality has become a good future investments for tea to access the growing special and higher segment in the rich tea consuming world.