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Sri Lanka tea growers set for party as prices soar

March 3, 2008 (AFP) - The tea industry in Sri Lanka, the world's second biggest exporter of the crop, is looking forward to good times again as prices soar on a global commodities boom.
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And the rise for a cup of tea comes as the prices of other traditional brews such as cocoa and coffee have also risen.
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Mounting productions costs and growing demand are combining to reverse a three-decade old trend toward lower prices, according to industry officials, and that means drinkers will likely have to pay more for their brew.
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Dilhan Fernando, director of Dilmah Tea which sells more than 500 million dollars of tea in over 90 countries, expects strong prices to halt the long slide in tea prices and boost earnings for producers.

"We have never had it so good. The climate has changed and we are seeing consumers willing to pay more for their teas," he told AFP.

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Sri Lanka earned a record 1.03 billion dollars in 2007 selling the commodity overseas and expects to earn more this year.

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"Tea will be a bull market in 2008," said Kaison Chang, of the United Nations Food and Agriculture Organisation (FAO).


"The fundamentals have changed and consumers are likely to see price rises."

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