Sri Lanka’s tea export earnings fell 17.3% year-on-year to $114.75 million in March, while exports to Iraq dropped 38% and shipments to the United Arab Emirates plunged 93%, as the Middle East conflict continues to hit the country’s tea industry and wider economy, according to a Reuters report.

The report highlighted that Sri Lanka’s $1.5 billion tea industry, which supports around 2.4 million people, is increasingly feeling the impact of the crisis, with nearly half of the country’s annual tea exports, worth around $680 million, destined for Middle Eastern markets.

State-run Export Development Board (EDB) data cited by Reuters showed the sharp decline in exports has added pressure on plantation communities already grappling with rising living costs.

Tea plantation worker Jacintha Malar told Reuters she had switched from cooking on gas to firewood due to higher fuel prices. Malar and her husband, a tea plucker in Sri Lanka’s central hills, are among millions dependent on the tea sector.

Tea plantation workers typically earn between Rs. 1,350 and Rs. 1,750 per day, only slightly above Sri Lanka’s daily minimum wage of Rs. 1,200. Reuters reported that more than half of plantation workers live below the World Bank’s international lower-middle-income poverty line.

Thangawel Ganeshalingam, convener of the Movement for Plantation People’s Land Rights, told Reuters that plantation workers were facing “crisis after crisis,” warning of rising school absenteeism, fewer meals and workers leaving plantations in search of better opportunities.

Exports to Iran also remain a concern, with the country importing between 8 million and 10 million kilograms of premium Sri Lankan tea annually.

Meanwhile, Dilmah Chairman and CEO Dilhan Fernando told Reuters the company was dealing with shipping and logistics disruptions and rising fuel costs linked to the conflict.

The Reuters report noted that pressure on the tea sector comes as Sri Lanka’s broader economy also faces fallout from the Middle East crisis, including higher energy costs and supply disruptions. (Newswire)

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