Business

Plantation exports in the doldrums since 2015: S. M. Chandrasena

By Madhusha Thavapalakumar

Three of Sri Lanka’s major exports have deteriorated drastically over the past three years, S.M. Chandrasena, who was recently appointed Minister of Plantation Industries, said on Thursday (29).

Addressing the media, he charged that the tea, rubber, and coconut industries, which brought in large amounts of foreign exchange earnings to Sri Lanka over the decades, were now “in the doldrums”.

According to Central Bank of Sri Lanka (CBSL) data, the total export revenue of tea, rubber, and coconut came down to $ 3 billion in 2017, from the $ 3.13 billion recorded in 2014.

Meanwhile, the collective export revenue from the three industries, during the first nine months of 2018, recorded a decline of 2.2%, in comparison to the same period in 2017.

Sri Lanka’s main agricultural export, tea recorded an export revenue of $ 1.5 billion in 2017, while $ 1.6 billion was recorded in 2014.

Tea export revenue also recorded a decline of 4.1% from January to September, 2018, compared to the same period in 2017.

Reacting to Chandrasena’s comments, Lucille Wijewardena, who was Chairman of the Sri Lanka Tea Board (SLTB) until a few weeks ago, attributed the decline in tea exports to the inadequacy of tea replantation and adverse weather conditions.

“Not replanting enough is the main reason for this decline. It should be done properly. The number of tea bushes has been decreasing in Sri Lanka and the quality is also going down.”

According to Wijewardena, a few days before the political crisis, SLTB together with the Ministry of Plantation launched a programme to replant 5,000 hectares of tea in order to increase crop yields.

“When I was the Chairman of the SLTB, we launched this initiative. But I do not know what the process is now,” said Wijewardena, who refrained from SLTB functions, owing to the political crisis.
In the meantime, Sri Lanka’s rubber exports brought in $ 874 million in export revenue in 2017, which is a decline of 6.49% from the revenue of $ 935 million recorded in 2014.

However, overall rubber products recorded a 6.8% growth during the first nine months of 2018, in comparison to the same period in 2017.

When The Sunday Morning Business contacted Rubber Research Institute of Sri Lanka (RRISL) Additional Director V.H.L. Rodrigo for his comments, he admitted a slight decline in the natural rubber exports but noted a positive growth in the overall rubber product exports.

“Rubber products are increasing, but our productivity has dropped. As we do value addition for rubber in Sri Lanka, we have to import one third of the required rubber.”

Rodrigo noted that the lack of productivity and the high cost of production made Sri Lankan rubber incompatible, as the global market price of rubber was lower.

“People are moving away from rubber cultivation due to the higher cost of production. They do not like to incur losses. Our yield has come down to 900 kg/hectare per year from 1,500 kg/hectare per year,” he said.

However, according to Rodrigo, in October, the Ministry of Plantation Industries had launched a three-year plan to address the low productivity issue in the rubber industry and, despite the political crisis, RRISL met with the Ministry last week to discuss the implementation of the programme.

Interestingly, coconut, one of the traditional agricultural products of Sri Lanka’s export basket, has seen a positive growth by recording $ 587.5 million in 2017, which is a 6.9% growth from the $ 549.5 million revenue recorded in 2014.

However, when comparing the first nine months of 2017 with the same period this year, coconut exports have seen a decline of 12.8%.

All attempts to contact the Coconut Cultivation Board (CCB), Coconut Development Authority (CDA), and the Export Development Board (EDB) for comment failed.