As one of the world’s largest tea producers, we’re used to seeing massive tea production numbers from Sri Lanka. However, Sri Lanka’s Daily News is reporting that the country’s tea industry could achieve $5 billion USD in exports by the year 2020.
Since the entire country’s GDP is worth approximately $50 billion, the fact that tea could be worth about 10% of that amount is notable. However, the important thing to realize about this news is that the country’s tea production would not necessarily increase, but the price of Ceylon tea would.
Sri Lanka’s Treasury Secretary stated last week that production of tea is only expected to increase by 2% to 3% by 2020. Prices, however, could be raised by as much as triple their current price. The statement was made at the 118th Annual General Meeting of the Colombo Tea Traders Association, held June 29th in Sri Lanka’s capital.
This means that, within the next 5 to 10 years, prices on Ceylon tea could raise dramatically. Ceylon tea is famous for its black tea blends, as well as its connection to various health benefits. Of course, many people find Ceylon tea to have a delicious taste as well.
The Treasury Secretary also urged Sri Lankan tea manufacturers to work together to ‘brand’ the country’s tea in order to collectively increase its value throughout the world. While Ceylon tea is a name known by most tea drinkers throughout the world, it’s not quite on the level of other famous brands, like Earl Grey tea or Oolong.
Interestingly enough, many in Sri Lanka view tea as a “rich man’s drink.” Most of the country’s tea crops are exported to places all over the world or consumed at higher prices locally. Cheaper teas are often imported, allowing locals to profit off of the high prices paid for Ceylon tea around the world.
What’s the secret behind Sri Lankan tea?
You might know Sri Lankan tea better as ‘Ceylon’ tea. Ceylon was the name of the country under British rule during the 19th century. The British had a profound influence on the country’s tea production, turning the sub-tropical island nation from a coffee-producing country to a tea-producing powerhouse in an incredibly short period of time.
Today, the investments made by the British government are clearly paying off. Not only does the country earn millions of dollars in tourist revenue due to its beautiful British colonial-style tea plantations (which are scattered throughout the countryside), but Sri Lanka also depends upon the infrastructure and administrative systems established by the British in order to manage the country’s tea resources.
Since Sri Lanka has only recently become stable after the end of its civil war, its tea industry – and the country as a whole – is expected to grow at a rapid pace over the coming years. Some even expect Sri Lanka’s GDP to grow to $100 million by 2020, which means that tea production would account for far less than 25% of that amount.
As of now, ESP Emporium’s Ceylon tea prices haven’t changed, and we don’t expect them to rise dramatically at any time in the near future. If the price of Ceylon tea does change by double or triple its current price at any time over the coming years, our ESP Emporium blog will be the first to let you know.