Sri Lanka Tea prices soar in May over declining volumes
June 08, Colombo (LNW): Sri Lanka tea industry is bracing for revival with soaring sales amidst drop in crop but upward trend in prices as well as exports. Tea Board sources claimed.
In the backdrop of declining volumes, tea prices are on the rise sharply with May establishing record National Sales Averages both in rupee and dollar terms.
Forbes and Walker Tea Brokers said in May, as well as year to date, have seen significant gains except for High and Medium grown.
In May, the total auction average of Rs. 1,266.80 per kilo, the High grown average of Rs. 1,162.31 per kilo, Medium grown average of Rs. 1,074.79 per kilo and Low grown average of Rs. 1,608.57 were the highest ever.
Sri Lanka’s tea crop in April 2024 has dropped to a four year low of 21.46 million kilos, which is also the lowest since the COVID-19 lockdown year of 2020.
Forbes and Walker Tea Brokers said the National Tea Sales Average (TSA) for May 2024 registered Rs. 1,266.80 ($ 4.25), reflecting an increase of Rs. 49.95 and $ 0.16 compared to the April 2024 average of Rs. 1,216.85 ($ 4.09).
This substantial growth also shows a positive year-on-year (YoY) variance, with the May 2023 average standing at Rs. 1,055.45 ($ 3.43).
It also added that the current figures mark an impressive increase of Rs. 211.35 and $ 0.83 over the previous year.
Breaking down the averages by region, the High Grown tea segment showed a month-on-month (MoM) increase of Rs. 4.81 and $ 0.01. However, there was a decrease of Rs. 83.38 and a positive variance of $ 0.10 YoY.
The Medium Grown tea average also recorded a positive MoM variance of Rs. 6.87 and $ 0.02, although it saw a slight YoY decrease of Rs. 5.36 while still achieving a $ 0.32 increase in Dollar terms.
Forbes and Walker Tea Brokers said the Low Grown tea segment particularly stood out, with increases in both rupee and dollar terms, recording Rs. 72.31 and $ 0.24 MoM. The YoY average for Low Grown tea also demonstrated substantial growth, with an increase of Rs. 18.35 and $ 0.47.
It added that despite some regional variances, overall, the tea industry has shown resilience. Both High and Mid Grown regions experienced negative variances in rupee terms during the period from January to May 2024 compared to the same period in 2023.
However, all elevations recorded positive variances in Dollar terms, underscoring the sector’s strong performance on the international market.
The figures also highlight the robust demand and strategic positioning of Sri Lankan tea in global markets, setting a promising outlook for the remainder of the year.
