Despite the weather impact of cyclone Ditwah causing a loss of at least 1 million kilograms of Ceylon tea in December 2025, the sector is expected to record a cumulative production increase of at least 10-12% this year, Sri Lanka Tea Board Chairperson Rajpal Obeyesekere told The Daily Morning Business on Tuesday (3).
“We are hoping that we will produce 300 million kg this year, that’s our target, with the expectation that the weather patterns stay predictable. In the month of December, Ditwah took away around 1 million kg, with one week’s production on halt,” Obeyesekere said, adding that the sector is hopeful for a revival this year with Government fertiliser subsidies.
Sri Lanka’s tea production surpassed its 2024 production levels by 1.43 million kg in 2025, producing 264.12 million kg, up from the 262.69 million kg seen in 2024, Tea Board data shows. However, 2025’s production also is an 8.03 million kg increase from the yearly production levels of 2023.
“It all depends on the weather patterns. If you see last year, in the first six months there was a massive growth. In the second six months, there was a decline,” Obeyesekere said.
The Department of Census and Statistics’ Gross Domestic Product by Production report for the third quarter of 2025 also shows that Sri Lanka’s tea production segment saw an 8.1% contraction in volumes, owing to supply-side disruptions, which included increasing input costs, long-running inabilities to recultivate plantations, and labour shortages.
This was noted in the quarter prior to the impact of cyclone Ditwah. “Generally, in the last half there was a sizable dip overall. Hopefully we can expect 290 million kg to 300 million kg this year,” Obeyesekere said.
Tea Factory Owners Association Chairperson Lionel Herath also confirmed to The Daily Morning Business that due to the adverse weather impacts on the southeastern and central parts, Sri Lanka had foregone at least a million more in production.
“If not for Ditwah, we would have produced another million kilos. Especially with the Uva Province and Kandy areas affected, production was impacted,” Herath said, speaking to The Daily Morning Business yesterday (4).
On the export earnings front, Obeyesekere expects a continuation of momentum seen in the previous years to be reflected this year too. “We expect to see a 5% increase in export earnings. Last year, [export earning] value and [production] volume wise, there was a 5% growth, compared to 2024. We can expect to keep the same momentum in 2026, but of course with the volatile global situation, there certainly can be disruptions.”
Tea Board data shows that 2025’s exports grew by 11.65 million kg with a total of 257.4 million kg exported, up from the 245.7 million kg exported in 2024. In export earnings, this was reflected as a 4.8% increase in earnings, up from the $ 1.434 billion earned in 2024, to $ 1.506 billion in 2025.
The Free On Board pricing (FOB), or the average export price of tea had largely remained similar to the value recorded in 2024, at an estimated $ 5.85, up from $ 5.84. “Last year, even with the so-called tariffs, conflict in the Middle East etc., we managed to have a 5% growth in exports, which we expect to see this year too,” Obeyesekere said.
“That’s our projection. We expect the fertiliser subsidies to ensure that our smallholders help us meet a better output this year.” As for structural sector issues, such as replanting, both the Tea Board and Factory Owners Association expressed the plans that are currently underway.
“Replanting is going on at a scale at which we had planned. However, it is a long-term project, which would yield positive results much later. At the moment we are carrying out our replanting plan, and the Tea Small Holdings Development Authority is carrying out their replanting plan. They are currently replanting on one acre, and we, the SLTB, are doing 10 and above,” Obeyesekere said, speaking on behalf of the Board.
“As the TFOA, we have a strategic plan to commence planting 10 million tea plants this year, in partnership with Commercial Bank. With the blessings of the Tea Board, we are looking forward to going ahead with this, and replanting 2,000 acres by 2027,” Herath said, speaking on behalf of the TFOA.
With regards to mechanisation, Herath said that as the labour issue is not expected to be resolved any sooner, mechanisation, though at a low-scale, is underway. “The labour issue is not resolving any sooner, for that we have to move into mechanisation. Less than 7% of the factories that we are aware of have adopted mechanisation. RPCs have a fair amount of mechanisation employed, but we cannot put a figure on that.”