The Colombo Tea Traders™ Association (CTTA) said in a statement that cash flow problems remained throughout the supply chain, with buyers saddled with stocks bought at prices well above current rates.
"The manufacturers the Private Tea Factory Owners and the Regional Plantation Companies have to contend with depleted working capital, which is severely affecting their operations."
However, it said, media reports that predicted that the collapse of the tea industry was imminent, were overblown.
"These prophesies of doom have now been replaced by over-optimistic declarations that the crisis is behind us and all is well with the tea industry," the CTTA, which represents most sectors of the trade, said.
"This is not the case! The tea industry has still many trials to face before it can return to normal.
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The crisis erupted last month when large stocks of teas went unsold and prices plunged, following the collapse of the global commodities bubble.
Sri Lankan tea pric