$ 1.4 b in tea export earnings anticipated

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Sri Lanka is eyeing an annual tea export revenue of $ 1.4 billion in 2021, as tea exports are gradually increasing following the hit it took from the pandemic in 2020.

Speaking to us, Sri Lanka Tea Board Chairman Jayampathy Molligoda said that Sri Lanka had earned a total tea export revenue of about $ 858 million (Rs. 174.3 billion) between January and August 2021.

With this figure, he said the Tea Board expects a total revenue of $ 1.4 billion by the end of 2021 from tea exports.

Tea export value up 14% to $ 650 m in first half; volume higher by 10% |  Daily FT

The country had a total tea export revenue of $ 1.24 billion in 2020, which was a drop from the $ 1.35 billion in 2019, mainly due to the pandemic and financial constraints the economy went through.

According to statistics of the Tea Board, the FOB (free on board) value of Rs. 927.21 recorded between January and August 2021 is an increase of Rs. 68.96 compared to Rs. 858.25 of January-August 2020.

Sri Lanka exported 25.48 million kilos of tea in August 2021, an increase of 3.47 million kilos over the same month last year, which was 22.01 million kilos of tea.

Export earnings from tea in August 2021 increased by 13.41% to $ 116.78 million and export volume has increased by 16.1% in August 2021 compared to August 2020.

Molligoda said that even though Sri Lanka produces 300 million kilos of tea annually, the country does not provide at least 5% of the global production, as China and India are major tea producers in the market, especially in green tea.

However, he said the Tea Board will use various promotional activities to promote Ceylon black tea, which is considered orthodox tea in the world, in countries such as Russia, China, Japan, and Ukraine in the coming months.

Speaking about the promotional activities, Sri Lanka Tea Board Director – Promotion (Overseas and Local) Pavithri Peiris said Ceylon Tea will kick off its one-year-long global campaign in early November from Russia and Ukraine with 56 key opinion leaders (KOL) – 15 KOL to Ukraine and 41 KOL to Russia. The Sri Lanka Tea Board has hired KOL with an over one million follower base.

Moreover, Peiris said that the Ceylon black tea campaign will also be launched in Japan and China early next year. She added that the Tea Board will continue the social media campaign they did in 12 countries in December 2020 this year, with the addition of two more countries to the list. Accordingly, some of the countries include the US, the UK, Germany, Japan, China, Australia, the UAE, Saudi Arabia, and Turkey.

Peiris also said the Ceylon black tea social media campaign was already run in countries such as China and Iran outside Facebook and YouTube.

Further speaking on the brand promotion scheme initiated by the Tea Board, she said the scheme, which received cabinet approval in August 2021, will reimburse 50% of the brand promotion cost of Ceylon Tea brands which will do promotional activities overseas. The maximum reimbursement for each brand is limited to Rs. 50 million per brand, while the brand also should put in whatever the equal amount from their part.

The total budget allocation for this scheme for next year is Rs. 1 billion and this is the third phase of the programme which started in 2015. Earlier, 20 companies benefited from this programme during 2015/2016 and 18 companies benefited during 2018/2019.

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