Sri Lankan tea exports fall 5% in first eight months of 2026 amid rising costs
Sri Lanka’s tea export volumes have dropped by 5% year-on-year during the first eight months of 2026, driven by elevated freight and insurance costs alongside market access disruptions.Data analysed by research firm Asia Siyaka Commodities PLC shows that cumulative exports between January and August reached 166.3 million kilograms, down from 174.2 million kilograms during the same period last year.In US dollar terms, total export earnings fell to approximately 948 million US dollars, compared to 1.026 billion US dollars previously, while the average free-on-board value dropped 3% to 5.70 US dollars per kilogram.Despite lower volumes and reduced dollar revenue, Sri Lankan rupee earnings remained relatively stable due to currency depreciation, shifting marginally from Rs. 306.5 billion to Rs. 305.6 billion.In August alone, tea exports fell by 4% to 22.8 million kilograms compared to 23.7 million kilograms shipped in August 2025.Asia Siyaka Commodities PLC noted that despite these broader logistical challenges, quantities offered at the Colombo Tea Auctions continue to sell without major disruption.Market distribution shifted significantly across key trading partners over the eight-month period.Turkey retained its position as Sri Lanka’s primary export destination, with volumes almost doubling from 12.4 million kilograms to 24.7 million kilograms.Conversely, shipments to Iraq fell sharply by 45% to 14.4 million kilograms, while exports to Russia dropped 10% from 14.7 million kilograms to 13.3 million kilograms.Deliveries to the United Arab Emirates experienced a dramatic 65% drop from 12.7 million kilograms to 4.4 million kilograms, highlighting mounting pressure on traditional transit routes.Elsewhere, exports to Libya fell by 62% to 5.4 million kilograms, Chile dropped 36% from 7.7 million kilograms to 4.9 million kilograms, China declined 18% from 6.8 million kilograms to 5.5 million kilograms, Saudi Arabia fell 19% to 4.7 million kilograms, and Syria decreased 14% to 4.7 million kilograms.On a positive note, Azerbaijan recorded a growth of approximately 20% to 7.1 million kilograms from 5.9 million kilograms, while Jordan saw an increase of roughly 39% from 3.7 million kilograms to 5.2 million kilograms.Exports to Germany remained steady at 4.5 million kilograms.Asia Siyaka Commodities PLC concluded that while local currency earnings reflect the underlying strength of local prices, elevated shipping costs, reduced dollar revenue, and falling average export values continue to pose serious challenges for the industry.
