Sri Lanka Ceylon Tea Production and Exports: 2023

Sri Lanka Ceylon Tea Production Statistics for Dec-23 and Cumulative Annual Overview

Sri Lanka's Ceylon tea production reached 19.81 thousand metric tons (mt) in Dec-23, indicating a slight increase compared to the 19.71 thousand mt in Dec-22. However, Dec-23 production decreased by 710 mt compared to Dec-21. Total tea production for 2023 totaled 256.04 thousand mt, experiencing a positive variance of 4.2 thousand mt compared to the 251.84 thousand mt in 2022. The cumulative production in 2023 witnessed a decrease of 43.45 thousand mt compared to the 299.49 thousand mt achieved in 2021.

Figure 1. Sri Lankan Tea Production from 2021 to 2023

Positive Growth in Sri Lanka's Ceylon Tea Exports In Dec-23

Sri Lanka's Ceylon tea exports experienced a positive trend in Dec-23, totaling 20.75 thousand mt, an increase of 1.45 thousand mt compared to Dec-22. While Ceylon packeted tea, tea bags, and green tea exports witnessed growth in Dec-22, tea in bulk and instant tea experienced a decline during 2023. Total tea exports in 2023 amounted to 241.91 thousand mt. This represents a decrease of 8.28 thousand mt compared to 2022, with 250.19 thousand mt. Notably, the tea bags and green tea categories recorded marginal growth in 2023, while other categories exhibited a drop.

Figure 2. Sri Lanka Tea Exports in 2023

Leading Countries and Notable Shifts in Ceylon Tea Imports In 2023

Iraq remained the leading importer of Ceylon tea from Sri Lanka, although with a decline of 24% year-on-year (YoY) compared to 2022. Türkiye ranked second, with a 95% YoY increase due to earthquakes affecting their production, surpassing Russia ranking third, followed by the United Arab Emirates (UAE), which saw a decline of 8% and 18% YoY, respectively. China registered a 10% YoY rise, ranking fifth. Other notable importers include Libya, Azerbaijan, Chile, Syria, and Saudi Arabia. On the other hand, Iran experienced a significant decline, dropping from fifth place to eleventh position with a 50% YoY import decrease.

Figure 3. Top 2023 Sri Lanka Importers and 2024 Expectations

Global Tea Market Forecast 2024: Navigating Challenges for Growth

Analysts anticipate a modest global tea output increase of 1.5% to 3% in 2024 and 2025, marking a decline from the historical annual average growth of 4.4%. The projections carry uncertainties due to potential El Niño impacts. In Sri Lanka, the strict enforcement of the B60 program, which requires tea growers and manufacturers to adhere to enhanced standards for green leaf production, may temporarily limit availability but improve the overall quality of Ceylon tea. Additionally, the first quarter of the production window, known as a lean period for many producer countries, sees improved availability of higher-quality teas in Sri Lanka's Western region.

Rising input costs pose another consideration, potentially impacting farmer profits. Investments in the sector for increased productivity face challenges due to weak prospects. Although global fertilizer prices eased in 2023, they remain historically high. Tea-producing countries will likely offset these costs by embracing technology and mechanization to enhance production efficiency, addressing constant labor shortages. These long-term measures are expected to boost production gradually.