John Keells calls for minimum quality standards

A top Colombo tea broker has called for the imposition of a minimum quality standard as a means of improving the quality of tea traded internationally, and by default, reduce the quantity of tea in the world market.

John Keells PLC in its latest annual Tea Review said many countries that consume Ceylon Tea, require imports to comply with International Food Factory Hygiene Standards throughout the supply chain. Towards this low interest credit facilities were arranged under the Tea Development Project to modernize Tea Factories to obtain HACCP Certification, it said. The report discusses in detail the tea industry of Sri Lanka and the factors that influence it, including the global economy, weather, supply/demand, work force agitation, and cost of inputs.

It said a significant adverse impact was seen in the first quarter of 2007 resulting from the wage related island wide go slow campaign launched by estate workers in November, which lasted for 15 days followed by a two week strike. The trade union action ended with the granting of a 33% wage increase to the plantation worker.

The report also states that an added concern for producers in the current market environment is their profitability in the face of rising costs of production.

Improving yields through capacity building of growers, optimising inputs, streamlining marketing channels and improving infrastructure have been touted as a means of reducing production costs, but may also lead to an over-supply situation.