First half tea exports down 10% YoY

• Rupee earnings improve sharply to Rs.209bn due to depreciation against US dollar 
• Dollar earnings also improve – up by 10.4% 
• Value-added exports remain unchanged

Sri Lanka’s tea exports for the first half of 2023 (1H23) have declined by 10 percent compared to the corresponding period 
in 2022. 
The Customs data analysed by Siyaka Research showed that tea exports for the period January-June 2023 dropped to 112 million kilograms, compared to 125 million kilograms the previous year.

A study of the pattern of monthly exports shows that in five out of six months, the quantities have been lower than the previous year, according to Siyaka Research. 
Rupee earnings improved sharply to Rs.209 billion, from Rs.164 billion in the corresponding period in 2022. The rupee earnings improved primarily due to the local currency depreciating against the US dollar from March 2022, 

when it dropped sharply from Rs.200-255 and continued to slide, peaking at Rs.363 per US dollar in October.
However, in US dollar terms, Sri Lanka earned US $ 637 million in 1H23, up 10.4 percent from last year’s figure of US $ 577 million. 

“This converts to an approximate FOB of US $ 5.68 per kilogram, compared with US $ 4.61 a year ago. This is the highest dollar FOB figure in more than 25 years,” Siyaka Research said.  The total dollar earnings of Rs.637 million, though higher than last year, are less than the US $ 650 million earned in 1H21. However, in 2021, Sri Lanka exported a quantity of 136 million kilograms, 18 percent more than the 112 million kilograms in 1H this year.  Value-added exports remained unchanged at 57 percent of the total. The tea bag shipments remained steady but the packet tea segment declined sharply. A review of destinations shows Iraq on top of the list, with 14.7 million kilograms but exports to this destination have declined 37 percent year-on-year (YoY) compared to 23.5 million kilograms exported in 1H last year. 

Exports to and through Turkey have risen 89 percent, from 7 million kilograms to 13 million kilograms. After an extended period of decline, exports to Russia have increased to 12.3 million kilograms, from 10.1 million kilograms a year ago. 
The UAE stood at 7.4 million kilograms, though down from last year, with China holding steady at 5.7 million kilograms.