Ceylon Tea demonstrated resilience amid global uncertainty as the Tea Exporters Association (TEA) reviewed the industry’s challenges, production potential and policy priorities at its 27th Annual General Meeting in Colombo. The meeting brought together exporters, government officials and industry stakeholders under the theme “Navigating Challenges.”
Ceylon Tea exporters assess shipping disruptions, production and policy priorities
Held at the Grand Marquee of the Taj Samudra Hotel, the AGM confirmed the reappointment of Huzefa Akbarally as Chairman of the Tea Exporters Association for 2026/2027. Discussions focused on the pressures affecting the tea trade, including geopolitical tensions, shipping disruptions, production constraints, quality concerns and changes to domestic tax and incentive frameworks.
Addressing the gathering, Akbarally described the past year as particularly challenging for the tea industry. He pointed to ongoing global conflicts, Cyclone Ditwa, the abolition of SVAT, declining tea production and quality-related issues as factors affecting the sector’s operating environment.
He also highlighted the impact of disruptions to international shipping routes. According to Akbarally, approximately 85% of Ceylon Tea shipping routes have been disrupted, forcing many vessels to take longer routes around the Cape of Good Hope. The resulting increase in freight costs has, in many cases, reached several times previous levels, adding pressure to exporters already operating in a difficult global market.
Despite these obstacles, Akbarally said the resilience of Ceylon Tea exports remained noteworthy. He expressed hope that a return to more stable global conditions would allow the industry to recover lost shipping capacity and potentially achieve an additional 100 million kilograms in exports.
The chairman also turned attention to domestic production, identifying the availability of green leaves as a key factor limiting the sector’s growth. He said Sri Lanka already had the expertise, exporting companies and factory capacity needed to process higher volumes, but that additional leaf supply was essential to unlocking this potential.
According to Akbarally, increased productivity could also deliver substantial benefits to smallholder tea producers. He estimated that each smallholder family could potentially earn around Rs. 94,000 per month, representing an approximately fourfold increase in income under improved production conditions.
He said the industry could realistically target production of 350 million kilograms by 2030 with appropriate government support. Among the measures highlighted was block infilling, which he described as a relatively low-cost method of improving smallholder productivity and strengthening household incomes.
Akbarally also renewed calls to restore the Tea Board’s brand promotion scheme, reinstate the value-added export incentive and permit imports of spices used in value-added tea products. These proposals reflect the industry’s broader interest in expanding beyond conventional tea exports and improving the competitiveness of Sri Lankan products in international markets.
The AGM also featured an assessment of Sri Lanka’s wider economic position by Dr. Nishan De Mel, Founder and Executive Director of Verité Research. His remarks examined the country’s exposure to global economic shocks and the buffers supporting its recovery.
Dr. De Mel said Sri Lanka appeared to be in a relatively strong position in terms of exposure and available buffers against the economic shocks of 2026. He noted that tourism had declined by only 1.8%, while remittances had increased by 21.4% up to the end of July compared with the same period in 2025.
He observed that the increased cost of oil imports was expected to be almost entirely offset by the rise in remittances. However, he cautioned that the country’s recovery should not be assessed solely through macroeconomic indicators.
Reflecting on the recovery following the 2022 debt crisis, Dr. De Mel said Sri Lanka had performed strongly on macro-fiscal indicators monitored by institutions such as the IMF, but had experienced weaker outcomes in areas directly affecting households. He pointed to the increase in poverty and employment challenges as evidence of the uneven social impact of the recovery.
He also described the Rs. 200 wage increase for estate workers as a sensible measure, arguing that it addressed some of the regressive aspects of the recovery by providing support to a community facing high levels of poverty. He encouraged mature industries, including tea, to advance policy proposals through transparent, evidence-based frameworks that the public could understand and support.
The discussions reinforced the importance of balancing export competitiveness with the economic wellbeing of workers and smallholder communities. For the Sri Lanka tea industry, improving productivity, supporting incomes and maintaining quality will remain central to long-term growth.
The AGM concluded with a renewed emphasis on policy support, market diversification and strengthening the position of Ceylon Tea in global markets. TEA, as the apex body representing Sri Lanka’s tea exporters, continues to advocate for measures aimed at improving the sector’s competitiveness and addressing structural challenges.
The association also held its 7th Outstanding Tea Producers Award Ceremony, recognising leading estates and factories across Ruhuna, Sabaragamuwa, Kandy, Dimbula, Uva, Nuwara Eliya and the Low Grown CTC category.
The awards highlighted the contribution of producers across Sri Lanka’s diverse tea-growing regions. Against a backdrop of international uncertainty and domestic production pressures, the recognition also underscored the continuing importance of quality, productivity and regional expertise to the future of Ceylon Tea.
With stronger support for smallholders, investment in production, attention to quality and a more enabling policy environment, the industry remains positioned to navigate current challenges while pursuing new opportunities in the global tea market.