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Cost of Production Breakdown
Composition of the total Cost of Production (COP) in the Sri Lankan plantation sector.
Primary Sources
Planters seek coordinated response to stabilise tea production, and ...
The Planters' Association of Ceylon (PA), has called for an urgent review and streamlining of the industry's cost structures in light of the unprecedented crisis in West Asia and the Strait of Hormuz.Currently, approximately 45% of Sri Lanka’s total annual Tea exports equivalent to approximately US$ 680 million of Sri Lanka's total US$ 1.5 billion Tea export revenue is generated from Middle Eastern markets across Iran, Iraq, UAE, and Saudi Arabia.Given the critical nature of these market for Pure Ceylon Tea, the PA noted with concern that the combination of supply and demand side constraints emerging since the start of the year are creating unprecedented and existential challenges for the entire plantation industry – spanning Regional Plantation Companies (RPCs) and smallholders across tea and rubber.Currently, wages account for nearly 70% of the total Cost of Production (COP) in tea and rubber. Input material costs such as Fuel, Fertilizer, Chemicals, Firewood, Packing Materials and other physical goods account for the rest of the COP.Until the most recent wage hike which came into effect from 1st of Jan 2026, plantation sector wages had been a perennially contentious challenge for the industry.While RPCs had always agreed in principle with the need to increase worker wages, the industry had consistently called for financially sustainable mechanisms for implementing wage hikes, in light of the significantly higher costs of production, and lower rates of productivity prevalent across Sri Lanka’s plantation industry.Following the end of the era of nationalized management, and privatization in 1992, plantation sector wages were set in accordance with a collective bargaining agreement between RPCs, Trade Unions, and the Employees Federation of Ceylon. In 2021, Trade Unions unilaterally withdrew from this process and successfully lobbied the Government to utilize the Wages Board Ordinance to mandate a daily wage of Rs. 1,000 between 2021-2023, and again up to Rs. 1,350 in September 2024.In a historic first, the current Government intervened to partially subsidize the most recent wage hike following a series of consultations with the Regional Plantation Companies, the Corporate Producer Sector of the Industry. The workers record a clear net gain, with daily wages rising by Rs. 400 to Rs. 1750.00 from January 1st 2026 which includes a government contribution of Rs. 200 per worker per day with the RPC’s accounting for the rest.Over the past decade, the Sri Lankan...
Planters seek coordinated response to stabilise tea production and key ...
The Planters' Association of Ceylon (PA), the apex body of Sri Lanka's Plantation industry, has called for an urgent review and streamlining of the industry's cost structures in light of the unprecedented crisis in West Asia and the Strait of Hormuz. Currently, approximately 45% of Sri Lanka’s total annual Tea exports – equivalent to approximately US$ 680 million of Sri Lanka's total US$ 1.5 billion Tea export revenue is generated from Middle Eastern markets across Iran, Iraq, UAE, and Saudi Arabia. Given the critical nature of these market for Pure Ceylon Tea, the PA noted with concern that the combination of supply and demand side constraints emerging since the start of the year are creating unprecedented and existential challenges for the entire plantation industry – spanning Regional Plantation Companies (RPCs) and smallholders across tea and rubber. Currently, wages account for nearly 70% of the total Cost of Production (COP) in tea and rubber. Input material costs such as Fuel, Fertilizer, Chemicals, Firewood, Packing Materials and other physical goods account for the rest of the COP. Until the most recent wage hike which came into effect from 1st of Jan 2026, plantation sector wages had been a perennially contentious challenge for the industry. While RPCs had always agreed in principle with the need to increase worker wages, the industry had consistently called for financially sustainable mechanisms for implementing wage hikes, in light of the significantly higher costs of production, and lower rates of productivity prevalent across Sri Lanka’s plantation industry. Following the end of the era of nationalized management, and privatization in 1992, plantation sector wages were set in accordance with a collective bargaining agreement between RPCs, Trade Unions, and the Employees Federation of Ceylon. In 2021, Trade Unions unilaterally withdrew from this process and successfully lobbied the Government to utilize the Wages Board Ordinance to mandate a daily wage of Rs. 1,000 between 2021-2023, and again up to Rs. 1,350 in September 2024. In a historic first, the current Government intervened to partially subsidize the most recent wage hike following a series of consultations with the Regional Plantation Companies, the Corporate Producer Sector of the Industry. The workers record a clear net gain, with daily wages rising by Rs. 400 to Rs. 1750.00 from January 1st 2026 which includes a government contribution of Rs. 200 per worker per day with the RPC’s a...
Planters seek coordinated response to stabilise tea production and key ...
Planters seek coordinated response to stabilise tea production and key export markets 1 May 2026 12:14 am Views - { {hitsCtrl.values.hits}} 0 Bookmark A A A
Planters seek urgent response to stabilise tea production, key export ...
The Planters' Association of Ceylon (PA), the apex body of Sri Lanka's Plantation industry, yesterday called for an urgent review and streamlining of the industry's cost structures in light of the unprecedented crisis in West Asia and the Strait of Hormuz. In a statement the PA said that currently, approximately 45% of Sri Lanka's total annual tea exports - equivalent to ...
