Tea industry overview – First quarter 2025 (another black liquid gold Iraq is involved in..whodathunk)

[Theseus]

Tea industry overview – First quarter 2025

 

 

28 April 2025 01:15 amViews - 0 0 Bookmark

 

 

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BY Ceylon Tea Brokers PLC

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The Sri Lankan tea industry saw an increase in production and exports but recorded a drop in the national average price for the period from January to March 2025 compared to the same period in 2024.

Iraq, Russia and Libya continued with strong demand for Sri Lankan tea and were the top three importers for the period January-March 2025. Macroeconomic factors continued in fundamentally challenging the tea industry framework, with variations in supply and demand, currencies and the political climate in importing countries.

For the first quarter of 2025, total production reached 61.78 million kilogrammes (Mn/Kgs), recording an increase of 3.61 Mn/Kgs, from the 58.17 Mn/Kgs recorded in January-March 2024. All three elevations recorded an increase in production when compared to the corresponding period in 2024. In CTCs, the Medium Grown teas recorded an increase whilst the High Grown and Low Grown varieties experienced declines. 

The Sri Lankan tea industry experienced growth in the first quarter of 2025, with total production increasing by 3.61 Mn/Kgs compared to the same period in 2024. Export volumes also rose during this period, recording an increase of 0.88 Mn/Kgs.

The national average tea price for January-March 2025 declined to Rs.1,179.32 (US $ 3.98) per kilogramme, from Rs.1,286.99 (US $ 4.11) during the same period in 2024, representing decreases of -Rs.107.67 in rupee value and -US $ 0.13 in dollar terms. The price variations across elevations showed the Low Grown teas averaging Rs.1,239.35 (US $ 4.18), Medium Growns at Rs.1,040.44 (US $ 3.51) and High Growns at Rs.1,118.77 (US $ 3.78). All three elevations recorded a drop in rupee value. 

However, in the dollar value, High Grown increased whilst the Medium and Low Grown categories experienced declines. The Low Growns, with the largest market share of 59.80 percent of production, recorded a drop of -Rs.141.32. Meanwhile, the High Grown and Medium Grown categories also saw decreases, falling by -Rs.36.95 and -Rs.82.26, respectively.

Sri Lanka tea exports for the period January-March 2025 amo63.21 Mn/Kgs vis-à-vis 62.33 Mn/Kgs recorded for the same period last year (+0.88 Mn/Kgs). The FOB average price per kilogramme for this period stood at Rs.1,738.80 (US $ 5.87) in contrast to Rs.1,779.43 (US $ 5.68), which recorded a decrease in rupee term (Rs.40.63) and an increase in dollar value (+US $ 0.19) when compared to the corresponding period in 2024. 

The FOB value of tea bags dropped in comparison to the same period in 2024. The total revenue realised for the period January-March 2025 from tea exports was Rs.109.90 billion (US $ 370.92 million), compared with Rs.110.91 billion (US $ 354.18 million) recorded for the period January-March 2024. It’s a drop in rupee term (-Rs.1.01 billion) and increase in dollar value (+US $ 16.74 million) compared to the same period in 2024. 

The teas in packets and bulk showed a decrease in FOB value. Iraq maintained its position as the leading importer of Sri Lankan tea during the first quarter of 2025, with Russia and Libya following as second and third largest markets, respectively. Exports to Iraq increased by +0.61 Mn/Kgs and Libya saw a significant increase of +4.29 Mn/Kgs. 

However, shipments to Russia declined by 0.09 Mn/Kgs. Exports to the UAE and Turkey dropped by -2.46 Mn/Kgs and -0.76 Mn/kgs, respectively. Chile rose by +0.9 Mn/Kgs but Iran recorded a decline of -0.68 Mn/Kgs. Exports to China saw an increase of +0.06 Mn/Kgs.

Tea imports by country – 2023 

Global purchases of imported tea totalled US $ 6.65 billion in 2023. The overall value of tea imported by all buyer countries declined by an average -6.5 percent since 2019, when global tea purchases cost US $ 7.12 billion. 

Year-over-year, the total dollar cost of imported tea fell by -12.2 percent, compared to US $ 7.58 billion during 2022.

In 2023, the five most valuable import markets for tea were Pakistan, the United States of America, United Arab Emirates, Russia and the United Kingdom. Combined, those major importers generated almost a third (31 percent) of the worldwide sales of imported tea. 

Black tea maintained its dominance at 76.7 percent of imports, while green tea’s share slipped slightly to 23.3 percent. 

Asia emerged as the largest importing region, with US $ 3.0 billion worth of tea purchases (44.8 percent of global total), followed by Europe (27.5 percent) and Africa (14.4 percent). The remaining imports were distributed across North America (10 percent), Oceania (1.9 percent led by Australia and New Zealand) and Latin America/Caribbean (1.4 percent). This contraction reflects broader market trends and shifting consumer preferences in the global tea trade. (Source: ITC)

The world’s major tea producing countries are currently witnessing moderate production levels. The tea prices are expected to be at healthy levels going into the second quarter.

 

Edited April 27, 2025 by Theseus