Twenty First Session
of
FAO/IGG ON TEA
1
SRI LANKA TEA INDUSTRY
MARKET REVIEW
Bandung, Indonesia, 5 - 7 November 2014
Janaki Kuruppu
Chairperson - Sri Lanka Tea Board
World Tea Production (Mkgs)
Country - total
World total
2500
6000
5000
2000
4000
1500
3000
1000
2000
500
1000
0
0
2006
Sri Lanka
2007
2008
China
2009
India
2010
Kenya
2011
2012
Vietnam
2013
Turkey
World
Source : ITC Report, London
World Tea Production (Mkgs)
Country
Sri Lanka
YOY %
China
2006
2007
1028.1
2009
2010
2011
2012
2013
318.7
291.1
331.4
327.5
328
340
4.6
-8.6
13.8
-1.2
-1.5
3.6
1140 1257.6 1358.6 1475.1
1550
1790
1924
310.8 304.6
-2
2008
-2
India
981.8 986.4
980.8
979
966.4
988.3
1126
1200
Kenya
310.6 369.6
345.8
314.2
399
377.9
370
432
Vietnam
142.5 148.3
166.4
175
170
178
190
180
145
147
149
4217.1 4624.62
4907
Turkey
142
178
155
153
148
World
3579
3795
3863.5
3944.4
4162.5
6
1.8
2
5.5
YOY%
1.3
9.6
6.1
Source : ITC Report, London
th
20
Session of FAO - IGG on Tea
At the 20th session in Colombo under the Chairmanship
of Sri Lanka, 3 new working groups were proposed:
Working Group on Organic Tea
Working Group on climate change
 Working group on Small Holder Farmers
5
So why an International Tea
Producer Forum?
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Vision and Mission of the ITPF
Vision
To position tea as the most acceptable, natural and healthy
beverage globally
Mission
To position tea as the most preferred beverage universally through
stimulating its consumption by facilitating and execution of generic
promotional campaigns and raising awareness of the health and life
style benefits of tea
Objectives of ITPF
a.
Safe guard interests of tea producer countries.
b.
Deliberate and evolve collective solutions on problems affecting
producers.
c.
Provide technical co-operation, sharing of technology and
expertise by member countries.
d.
Stimulate demand for tea by promoting consumption of tea.
e.
To undertake market studies, surveys, research projects aimed at
addressing any specific issues
f.
To undertake and facilitate programs for providing training to
members or their executives in various aspects of marketing tea.
Progress So Far
• 2012:
Signing a Resolution in Colombo, Sri Lanka at the 20th Session
of FAO/IGG to form an ITPF.
• 10 Countries namely India, Kenya, Sri Lanka, Indonesia, Bangladesh,
Malawi, Rwanda, Tanzania, Iran & Burundi signed that MOU.
• Proposal by Sri Lanka as the current Chair of FAO/IGG on Tea to host a
Ministerial Forum.
• 2013:
Historical gathering in Colombo on 21st January 2013 and ITPF
was formally established.
• Seven countries signed the MOU and the constitution (Sri Lanka, India,
Kenya, Indonesia, Malawi, Rwanda, Iran)
Country
2008
2012
2013
2014
India
Obtained Govt. Signed Resolution
approval
Founder member
Obtained cabinet
approval and
completed the process
Sri Lanka
Obtained Govt. Signed Resolution
approval
Founder member
Obtained cabinet
approval and
completed the process
Kenya
Obtained Govt. Signed Resolution
approval
Founder member
Response is awaited
Malawi
Obtained Govt. Signed Resolution
approval
Founder member
Response is awaited
Rwanda
Pending
Signed Resolution
Founder member
Response is awaited
Indonesia
Signed Resolution
Founder member
Response is awaited
Iran
Signed Resolution
Founder member
Response is awaited
Consent of Producer Countries
Bangladesh
Pending
Signed Resolution
Consented to be
founder member
Tanzania
Pending
Signed Resolution
Consented to be
founder member
Burundi
Pending
Signed Resolution
---
Zimbabwe
Pending
Signed Resolution
---
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
Millions KGS
Sri Lanka Tea Production
400
350
300
250
200
150
100
50
0
Total tea production
Tea Production – Elevation Wise
400
350
250
200
150
100
50
0
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
Millions Mkgs
300
High Grown
Medium Grown
Low Grown
Source : Sri Lanka Tea Board
Year
High
Grown
(%)
Mid
Grown
(%)
Low
Grown
(%)
Total
2006
74.7
24
51.6
17
184.5
59
310.8
2007
72.5
24
54.4
17
177.7
59
304.6
2008
84.4
26
49.0
15
185.3
59
318.7
2009
72.8
25
44.7
15
173.1
60
290.6
2010
79.1
24
56.1
17
196.2
59
331.4
2011
79.2
24
52.5
16
196.6
60
328.4
2012
73.6
22
52.6
16
202.1
62
328.4
2013
75.5
22
56.2
16
208.4
61
340.2
Source : Sri Lanka Tea Board
AREA OF TEA PLANTED IN SRI LANKA
Elevation
High Grown
41,137
Share
(100%)
19%
Mid Grown
71,018
32%
Low Grown
109,814
49%
221,969
100
Total
Planted (Ha)
Source : Sri Lanka Tea Board
SRI LANKA TEA EXPORTS
(Mn. KGS)
2008
Bulk
2010
2009
2011
2012
2013
178.0
164.6
176.8
179.9
130.25
130.09
Packets
84.3
75.5
89.8
95.8
153.8
157.0
Tea Bags
20.3
18.7
25.7
24.6
21.4
24.07
Others
18.6
21.2
1.8
2.9
0.54
1.98
ReExports
18.6
10.6
18.6
20.5
14.6
8.51
319.8
290.6
305.7
323.7
320.7
321.65
1.26
1.18
1.37
1.51
1.44
1.55
Total
(Mn Kgs)
Value
Billion USD
Source : Sri Lanka Customs
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1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
US$ Millions
Sri Lanka Tea Exports earning
1,800
1,600
1,400
1,200
1,000
800
600
400
200
0
Earnings
Ceylon Tea Exports FOB unit price
Rs./Kg
700
US$/Kg
6
600
5
500
4
400
3
300
2
200
1
0
0
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
100
Rs./Kg
US$/Kg
Source : Sri Lanka Customs
DOMESTIC CONSUMPTION
Year
Qty. (Mn. Kgs) Approx.
2006
2007
2008
2009
2010
2011
2012
2013
27.5
28.0
28.5
28.5
28.4
28.9
27.8
27.5
Source : ITC Report, London
DISTRIBUTION CHANNELS
Type





Supermarkets
Grocery retailing
Convenience stores
Tea Shops / Tea Houses
Others
Percentage
25%
30%
30%
5%
10%
Tea Industry’s Role in Sri Lanka’s Economy
 Tea export earnings reached USD 1.55 Billion in
2013 a historical high contributing 15% to the
nation’s foreign exchange.
 Of the 322 Mn Kgs exported over 55% was in
value added form
 Tea generates 65% of export agriculture revenue
 Tea industry contributes approx. 2% of the
island’s GDP
 With 2 Million employed directly and indirectly
10% of the population of Sri Lanka depends on
the industry.
Sri Lankan Tea Industry’s Role in the Global Tea
Economy
Sri Lanka remains the world’s largest orthodox tea producer
and the world’s largest orthodox tea exporter with 17%
market share
2013 production placed Sri Lanka as the 4th largest producer
of tea with 9% share of the global tea crop.
As per 2013 export volume Sri Lanka has been able to
sustain the position of 3rd largest exporter exporting to more
than 150 countries.
Sri Lanka also succeeded in maintaining her position as
world’s largest pre-packed tea exporter and the number one
in value added earnings (60%)
Ethical & Sustainable Practices
 Strict adherence of ISO 3720 Minimum quality Standard
across entire supply chain
 Ensuring certification on Ethical Tea Partnership, Fair Trade
Labeling , Rain Forest Alliance etc.
 Clean as ever in pesticide residues
 Compatibility with CODEX, FAO, EU & Japanese standards for
Maximum Residue Limits
Drive for re planting and in-filling to increase productivity
and reduce cost of production
Support Forest Garden Tea Growers to protect
biodiversity & commitment for ecological sensitivity
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Commitment to Sustainable Business
business
PURITY & FOOD SAFETY
ETHICAL
BUSINESS
Committed to the Ten
Principles in
• Human Rights
ISO 22000:2005
HACCP
• Labour Standards
• Environment
• Anti – corruption
Ethical Tea Partnership
ENVIRONMENT
SOCIETY
Rainforest Alliance Certification
GLOBAL GAP Certification
Forest Stewardship Council
Agricultural Standards
Beyond the TRI & RRI Guidelines
Committed to CEO Water Mandate
Signatory to the ‘Caring for Climate’
Preservation of Biodiversity
Living Environment
Health & Nutrition
Community Capacity
Building
Empowerment of
Youth
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OZONE FRIENDLY CEYLON TEA
 Accolade from Montreal Protocol in Canada for first ever
Ozone Friendly tea in the world.
 Sri Lanka tea industry was awarded Ozone friendly status in
2007 for non usage of Methyl Bromide an Ozone depleting
substance.
 Ozone friendly Ceylon tea supports the reduction of global
warming.
 Environmentally friendly & ecologically pure tea.
 Helps an earth caring community to free the planet from
pollution.
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Issues Facing Sri Lankan Tea Industry
 Exported to over 150 countries: No uniformity in
standards applied by importing countries
 Lack of knowledge of consumer countries about good
quality tea
 Low quality teas exploiting Ceylon Tea name
 Price War: undercutting
 Climate change Consequences – Extreme weather
Dependent – EL NINO/LA NINA Phenomena play
havoc
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THANK YOU.
SRI LANKA TEA BOARD
E-mail: promotion@pureceylontea.com
a.com
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