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Sri Lanka tea trade says poor quality depressing prices

ECONOMYNEXT – Sri Lankan tea traders have called on producers to focus more on improving quality, saying poor quality teas at the Colombo auctions were resulting in lower prices.

Anselm Perera, chairman of the Colombo Tea Traders’ Association (CTTA) said, the entire tea trade was suffering with lower earnings owing to the global slump in commodity prices for the past two years.

But he said the problem was compounded by low quality teas being sent by producers to the auctions.

There were too many factories vying for green leaf resulting in harvesting of poor quality leaf, he told the CTTA’s 122nd annual general meeting.

“This has resulted in poor quality production  resulting in poor auction prices,” Perera said.

Sri Lanka has 750 factories producing 320 – 340 million kilos of tea annually while its main competitor Kenya has 150 factories and produces over 400 million kilos, although Kenyan CTC (crush, tear, curl) manufacture was easier than the island’s mainly orthodox process.

The withdrawal of the fertiliser subsidy and inability to afford to buy fertiliser at the effective time of application contributed to production of inferior quality teas which depress auction prices further, Perera said.

“The problem lies with all the poor teas that we produce,” he said. “Each week at the auction some producers still continue to indulge permanently in bad manufacturing  practices and they complain of low prices and losses, expecting government subsidies in an unreasonable manner,” he said.

(COLOMBO, June 20, 2016)





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